United States v. Newport News Shipbuilding and Dry Dock Company

862 F.2d 464 (1988)

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United States v. Newport News Shipbuilding and Dry Dock Company

United States Court of Appeals for the Fourth Circuit
862 F.2d 464 (1988)

  • Written by Liz Nakamura, JD

Facts

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

Issue

Holding and Reasoning (Wilkinson, J.)

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