United States v. Newport News Shipbuilding and Dry Dock Company
United States Court of Appeals for the Fourth Circuit
862 F.2d 464 (1988)
Newport News Shipbuilding and Dry Dock Company (NNS) (defendant) was a large defense contractor that performed numerous goods and services contracts for the United States Navy. Most of NNS’s contracts with the federal government (plaintiff) were cost or cost-plus contracts. The Defense Contract Audit Agency (DCAA), a government agency within the Department of Defense, was empowered to audit the cost claims of government contractors by subpoenaing financial and business records. DCAA subpoenaed NNS for a wide range of financial and business documents, including tax returns, financial statements, balance sheets, and income statements. NNS filed a declaratory judgment to declare the subpoena unenforceable, arguing that the subpoena exceeded DCAA’s authority because (1) it requested materials without tying the request to a particular contract; and (2) the subpoenaed materials contained confidential business information. The district court held DCAA’s subpoena was unenforceable because the subpoena was not issued in connection with a particular contract. The government appealed.
Rule of Law
Holding and Reasoning (Wilkinson, J.)
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