Entered into an agreement with the federal government to

Question

Third Party Beneficiary. John Palace and Leonard Harlan, who headed Palace-Harlan, Inc., an investment firm, entered into an agreement with the federal government to buy Empire Federal Savings and Loan. Under the agreement, Palace-Harlan was to invest a nominal amount in the bank and arrange for others to invest much more, in exchange for, among other things, a promise that for two years, Empire would not be subject to certain restrictions in federal regulations. The govern­ment’s enforcement of other regulations against Empire led to its going out of business. Palace-Harlan, and the other investors filed a suit in the U.S. Court of Federal Claims against the government, alleging breach of contract. The government filed a mo­tion to dismiss all of the plaintiffs except Palace-Harlan, on the ground that the oth­ers did not sign the contract between the government and Palace-Harlan. Is the government correct? Should the court dismiss the claims brought by the other inves­tors? Why or why not?