Facts

Caltex Plastics Inc. filed two separate, but related complaints against Raytheon Co. and Lockheed Martin Corp.

PLAINTIFFS' CONTENTIONS:
Caltex Plastics alleged that it was the only manufacturer approved by the Dept. of Navy to produce packaging materials that comply with certain military specifications and used for certain electronic components and devices. Caltex Plastics also alleged that defendants entered into a number of contracts with the Dept. of Defense that required the use of the packaging materials that only Caltex Plastics was approved to supply. Caltex Plastics further alleged that Raytheon and Lockheed Martin failed to purchase these packaging materials from Caltex Plastics and instead used materials that were not approved by the Dept. of Navy.

DEFENDANT'S CONTENTIONS:
Defendants argued that Caltex Plastics complaint should be dismissed because Caltex Plastics was not an intended third-party beneficiary to any contract with the Dept. of Defense.

Result

The court granted the defendants' motions to dismiss. The court found, in part, that any contractual requirement for the packaging that only Caltex Plastics was approved to supply was intended to benefit the government and the Dept. of Defense. Therefore, even though Caltex may have been the only supplier to obtain the necessary certification, the court found plaintiff lacked sufficient facts that demonstrated it was an intended third party beneficiary of the contracts between defendants and the Dept. of Defense. The court granted the motions to dismiss without leave to amend and dismissed the actions with prejudice.

Other Information

Both cases are currently on appeal.