Concrete Tie of San Diego, Inc. v. Liberty Construction, Inc.

Liberty Construction, a minority owned business, entered into a contract with the Small Business Administration to build a warehouse for the Navy. After being sued by subcontractors under the Miller Act, Liberty and its sureties (jointly referred to as appellants) cross-complained against the SBA for indemnification. They sought damages in excess of $500,000 on claims that the SBA breached its fiduciary, statutory, and regulatory duties by awarding Liberty the contract when it knew that Liberty was incapable of performing the contract at a profit and by failing to provide Liberty with technical and managerial assistance during construction of the warehouse.

The district court dismissed the cross-complaints for lack of subject matter jurisdiction, rejecting appellants’ arguments that the district court had jurisdiction under the Federal Tort Claims Act and the “sue and be sued” provision of the Small Business Act, 15 U.S.C. § 634 (b)(1). 1 Because we hold that *801 the district court had jurisdiction over the claims against the SBA under its “sue and be sued” provision, 2 we reverse and remand for further proceedings on the merits.

In Munoz v. Small Business Admin., 644 F.2d…