Appeal of -- CANVS Corporation, ASBCA No. 56347, June 20, 2008. Board dismisses the appeal based on an alleged infringement of a CANVS patent. Because CANVS had no contract with the government there is no jurisdiction under the CDA.
Appeal of -- DCX-CHOL Enterprises, Inc., ASBCA No. 54707, June 18, 2008. DLA ID/IQ contract for electrical control boxes. After accepting more than the minimum quantity, the government terminated the contract for no-cost. Treating the termination as a constructive termination for default the Board denies the appeal finding that the termination was justified and that appellant did not carry its burden of showing that the default was excusable. Good discussion of the documentation required for QPL items.
Appeals of -- Fuel Tank Maintenance Co., LLC, ASBCA Nos. 54402, 54516, June 12, 2008. Navy contract. Pass through Type 2 differing site condition claims of subcontractors involve demolition of concrete at Puget Sound Naval Shipyard, Bremerton, WA. The Board sustains the appeal and in addressing a government argument that notice procedures were not followed notes “These requirements are not construed hypertechnically to deny legitimate contractor claims when the government is otherwise aware of the operative facts. [citations omitted] The burden is on the government to establish that it was prejudiced by absence of the required notice.”
HEDLUND CONSTRUCTION, INC., Appellant, v. DEPARTMENT OF AGRICULTURE, CBCA No. 105-R, June 05, 2008. The Board denies the joint motion to vacate the previous decision. A rather rare decision discussing the appropriateness of vacatur and relative Supreme Court decisions.
Appeal of -- Kostmayer Construction, LLC, ASBCA No. 55053. May 30, 2008. COE post Katrina construction contract for hurricane protection and enlargement of an existing levee. The Corps terminated the contract for default for failure to make progress. The ASBCA sustains the appeal of the TFD. The decision by Judge Peacock includes the following “We consider that the government has failed to sustain its burden of proving that the termination was justified. The decision to terminate here was unreasonable and an abuse of the contracting officer’s discretion because it was based on a materially inaccurate, misleading analysis by the contracting officer of the percentage of contract completion and a flawed assessment of appellant’s capabilities to complete the work in the more than seven months remaining for performance. The government unreasonably underestimated appellant’s ability to timely complete the project. Most significantly, the government underestimated and misanalyzed the degree of completion at the time of termination, appellant’s commitment of additional resources to timely complete, and the results of the government’s own test when it direct[ed](sic) appellant to ‘cure’ performance deficiencies.”
CH2M HILL HANFORD GROUP, INC. v. DEPARTMENT OF ENERGY, CBCA No. 708, May 30, 2008. Hanford nuclear site contract. Claims arise from the fact that CH2M employese were required to use self-contained breathing apparatus (SCBA) during performance of the contract. The government moves to dismiss the count based on reformation of the contract arguing that appellant has not alleged the existence of a mutual mistake and that appellant bears the risk not foreseeing that SCBA devices would be required. The CBCA denies the motion seeing “no flaw in the manner in which appellant has pled mutual mistake of fact.”
Appeals of -- Strand Hunt Construction, Inc., ASBCA Nos. 55671, 55813, May 22, 2008. COE contract for the design and construction of a Joint Security Forces Complex at Eielson AFB, Alaska. The Board denies two claims in this design-build contract. In denying the first claim the board finds “that the contract is not ambiguous because its express terms provided one and only one reasonable interpretation of the requirement for the sealing of concrete floors in utility areas not receiving one of the other designated floor finishes.” In denying the second claim the finds that the specifications were performance specifications and appellant must “bear the burden of its failure to investigate the availability of the required windows.”
TAS GROUP, INC., v. DEPARTMENT OF JUSTICE, CBCA No. 52, May 13, 2008. US Marshall’s Service contract. Appellant appeals the denial of its claim for damages to an aircraft engine of its subcontractor. In an earlier opinion the Board determined that the Government Liability clause in the contract would apply to damage to a subcontractor’s property. Relying on the federal common law of negligence the Board finds that the government breached its duty to exercise reasonable care during engine startup procedures which resulted to damage to the engine. The Board finds that “appellant has established its entitlement to damages in the amount of $827,743.79.”
Appeal of-- L-3 Communications Corporation, Link Simulation & Training Division, ASBCA No. 54920, May 05, 2008. Air Force contract. (See jurisdictional aspects of of this appeal, L-3 Communications Corporation, ASBCA No. 54920, 06-2 BCA ¶33,374.) Appellant “appeals the denial of its claim for breach of the fair opportunity to be considered provision applicable to award of a delivery order under a multiple-award, indefinite delivery/indefinite quantity (ID/IQ) contract.” The Board sustains “the appeal as to government breach of the ‘fair opportunity’ provision and find(s) Link entitled to recover its proposal preparation and submission costs in the amount of $186,482. Link, however, has failed to prove that, but for the breach, it would have been awarded the delivery order. Therefore, we deny its claim for lost profits and other damages resulting from the award of the order to another offeror.
Appeal of -- Raytheon Company, On reconsideration, ASBCA No. 54907, April 28, 2008. Appellant seeks reconsideration of the April 21, 2007, decision in this case. In that decision the Board “held that appellant failed to timely effect current period adjustments of pension costs as of the date of segment closing for two closed business segments, as required by CAS 413.50(c)(12), and appellant owed the government interest on these adjustments, compounded daily, in accordance with the CAS statute and CAS clause.” Although denying the requests for oral argument and submittal to the Senior Deciding Group, the ASBCA grants reconsideration and concludes that the government is not entitled to recover interest under the circumstances of this case and grants appellant’s motion for reconsideration and enters summary judgment for appellant.
801 MARKET STREET HOLDINGS, L.P. and 801 MARKET STREET ASSOCIATES, L.P. v. GSA, CBCA No. 425, May 02, 2008. Lease contract between GSA and appellants which included alterations and build-out requirements. Appellants contracted with Preferred Construction for services and construction activities and Preferred Construction entered into a contract with Nason to provide construction services related to the build-out. The appeal arises from the denial of a claim submitted by appellant that arose from additional costs incurred by Nason from alleged changes required by GSA. The government moves for dismissal or summary judgment arguing that the claims arose from parties that were not in privity with the government. In an opinion by Judge Hyatt, the CBCA denies the government’s motion to dismiss noting that “The contractual relationships formed between 801 Market Street and Preferred Construction and between Preferred Construction and Nason and Cullen come within the purview of the ‘time-honored practice’ of allowing ‘prime contractors’ to sponsor appeals of their immediate and lower-tier subcontractors.” The Board also denies the motion for summary relief, which is apparantly based on the Sevrin Docrine, noting that “To prevail in this motion, GSA must demonstrate that an ‘iron-clad release or contract provision’ conclusively exonerates 801 Market Street for liability to the subcontractors for the Government actions at issue here.”
INNOVATIVE (PBX) TELEPHONE SERVICES, INC. v. DEPARTMENT OF VETERANS AFFAIRS, CBCA Nos. 44, 45, 46, 576, April 30, 2008. Plaintiff seeks “damages for breach of contract based on bad faith and racial animus, lost profits from direct sales, and lost anticipatory profits from future contracts.” Appellant essentially argues that contract was a multi-year contract and the decision by the VA to not exercise the options was a breach. The CBCA denies all claims noting that “The appellant’s ‘hopes’ or ‘intentions’ that it would have a ten-year relationship under the contract do not make this a multi-year contract.” The Board also found no proof of bad faith of government officials, noting that it presumes “that government officials act in good faith in the discharge of their duties.” and that “To recover for bad faith action by government officials under a contract, a contractor must provide a direct connection between the alleged bad faith action and an express or implied contractual obligation or contract term.” No such showing was made here.
MINNEAPOLIS COMMUNITY DEVELOPMENT AGENCY and THE CITY OF MINNEAPOLIS, v. GSA, CBCA No. 385, April 28, 2008. Judge DeGraff starts her opinion with this—“‘Most of the disputes in the world arise from words.’ Morgan v. Jones, (1773) 98 Eng. Rep. 587, 596 (K.B.). As the appeal pending before us shows, words are no less troublesome in the contract disputes of today than they were when Lord Mansfield, Chief Justice was developing common law to govern commercial transactions.” In a lengthy opinion the Board denies appellant’s claim finding that GSA “never agreed to accept responsibility for paying the cost of remediating the conditions at the site.” A good look at the environmental remediation problems faced by GSA when constructing a courthouse.
EVERETT M. MYERS v. GSA, CBCA No. 940, April 10, 2008. Appellant purchased via an online auction an outboard engine that "needed repairs" and the terms of the sale required a request for a refund due to misdescribed property to be made within 15 days. 50 days later, appellant notified GSA that the engine was "blown" and could no be repaired. The CO denied the claim. The CBCA denies the appeal holding that “The law is clear that failure to comply with terms of the notice provision of the Refund Claim Procedure clause of the terms of sale precludes recovery.”
Appeal of -- Teknocraft Inc. ASBCA No. 55438, April 03, 2008. ASBCA dismiss the appeal for lack or jurisdiction because of an improper certification. The certification was sent by email and signed “//signed//” followed by a typed name. The Board holds that notation is “not a discrete, verifiable symbol. It is not a unique signature. The generic notation is not sufficiently distinguishable to authenticate that the certification was issued with [appellant’s] knowledge and consent or establish his intent to certify. Therefore, the certification was not properly executed as it was not signed.”
GOVERNMENT MARKETING GROUP v. DEPARTMENT OF JUSTICE, CBCA No. 71, April 02, 2008. Appellant appeals a CO’s decision of the Federal Prison Industries (FPI), doing business as UNICOR. The appeal was before the DOT BCA at the time of the creation of the CBCA. The Board denies the DOJ motion to dismiss for lack of jurisdiction. DOJ argued that “1) because UNICOR, a NAFI, is not subject to the CDA; 2) because the DOJ has not agreed that this Board would hear UNICOR cases in accordance with the additional jurisdiction provision of 41 U.S.C. § 438(c)(2); and 3) because this appeal, when commenced, was not properly before the DOTBCA and, therefore, is not properly before this Board pursuant to taaaaaaaahe savings provision.” Following Logan Machinists, Inc. v. Federal Prison Industries, DOTBCA 4184, 05-1 BCA ¶32,894, the Board determines that is has jurisdiction as DOJ had authorized the DOTBCA to hear appeals from DOJ CO decisions and that the appeal was properly before the DOTBCA.
Appeals of -- Total Procurement Service, Inc., ASBCA Nos. 54163, 55821, March 24, 2008. Appeals from an alleged breach of a license agreement entered into with DOD as a Value Added Network (VAN) provider. The Board dismisses one appeal alleging damages “in an amount in excess of $66,000,000.”, finding that it lacks jurisdiction because the claim is not for a sum certain. Although agreeing that the government breached the license agreement, the Board denies the other appeal for failure of proof of damages noting that “The failure to maintain, preserve and promptly produce to the government fundamental accounting data and records goes to the credibility of the entire claim. Appellant’s actions with respect to those records were irresponsible and militate against any award.”
Appeal of -- Qatar International Trading Co., ASBCA No. 55533, March 19, 2008. Air Force contract. Bulldozer being supplied by appellant to government was being transported by another Ktor but was not delivered because truck carrying bulldozer was in an accident while en-route to Iraq. Military moved bulldozer after accident to storage in Kuwait where it was subsequently given to others. Appellant claims government negligently breached the bailment agreement created when government diverted bulldozer to Kuwait. The Board grant the government’s motion to dismiss for lack of jurisdiction as the appeals sounds in tort for which the Board has no jurisdiction under the CDA. The Board notes that the bulldozer was never delivered to the Air Force under the contract and that the nexus between the alleged tort and some contractual obligation “must have a direct link between the alleged wrongdoing and some obligation imposed upon the government in the contract.” Finding no direct link, the appeal is dismissed.
APPEAL OF MIDWEST TRANSPORT, INC.,PSBCA No. 6132, March 21, 2008. The Board grants the motion by the government to dismiss for lack of jurisdiction finding that a letter from the Postal Service requesting payment of a fuel rebate was not a CO’s final decision. Good discussion of Federal Circuit decisions on what constitutes a claim and a CO’s final decision.
NAVIGANT SATOTRAVEL v. GSA, CBCA No. 449, March 19, 2008. Appellant includes a request for legal fees “because GSA did not include [a] memorandum in the appeal file, but instead, voluntarily provided it later in the proceedings.” Judge Kullberg denies the request noting that the Board “does not have the authority under any statutory waiver of sovereign immunity to impose monetary sanctions against the Government.”
Appeal of -- Mr. Michael Ronchetti and RFIDcomplete, LLC, ASBCA No. 56201, March 07, 2008. Appellants claim a teaming arrangement with the prime. The ASBCA grants the government’s motion to dismiss for lack of jurisdiction finding that appellants are subcontractors with no right to appeal under the CDA.
Appeals of -- Valenzuela Engineering, Inc. ASBCA Nos. 54939, 55464, February 21, 2008. Appellant was a suspended corporation under California law. Appellant argues that even though its charter has been suspended, it may still maintain this action in the context of winding up its affairs under California law. The Board rejects this argument noting that under California law a suspended corporation that owes back taxes, as does appellant, may not initiate or defend a lawsuit while its taxes remain unpaid. The Board dismisses the appeals finding that appellant lacks the capacity to maintain the action.
KENAN CONSTRUCTION CO. v. DEPARTMENT OF STATE, CBCA No. 807, February 14, 2008. After the government moved to dismiss for failure to submit a certified claim to the CO, appellant submitted a certified claim and requested a decision by the CO. The Board dismisses the appeal noting “As appellant included in its notice of appeal issues that had not as yet been submitted to the contracting officer as a claim with proper certification, its subsequent filing of a claim and certification cannot serve to cure our lack of jurisdiction over these issues.”
Appeal of FloorPro, Inc., ASBCA No. 54143, February 08, 2008. On reconsideration of the June 27, 2007 decision regarding a Navy contract and an unsponsored appeal of a subcontractor. See earlier 2004 decision of the same case. The Board reaffirms its earlier decision that it had jurisdiction of appellant’s claim as a third party beneficiary. Good discussion of third party beneficiary claims under the Tucker Act and the CDA.
Appeal of -- Northrop Grumman Ship Systems, Inc., ASBCA No. 55616, January 25, 2008. Navy ship design and construction contract. Appellant appeals the deemed denial of its claim under the contract’s INSURANCE-PROPERTY LOSS OR DAMAGE-LIABILITY TO THIRD PERSONS clause. The government moves to dismiss for lack of jurisdiction arguing that the claim is an insurance claim, not a contract claim under the CDA. The Board denies the government’s motion citing Winter v. Bath Iron Works Corp., 503 F.3d 1346 (Fed. Cir. 2007) a and states that it clearly holding that it has jurisdiction of an an insurance claim.
BLACKSTONE CONSULTING, INC. v. GENERAL SERVICES ADMINISTRATION, CBCA No. 718. January 23, 2008. Appellant claims anticipatory profits for unexercised option years of a janitorial services contract. The government moves to dismiss arguing that the “Government has unfettered discretion to exercise contract renewal options, with perhaps the exception of a non-exercise in bad faith.” The Board grants the government’s motion as to the fourth option year, which it finds to be speculative, but not as to the third option year. Judge Borwick notes that “appellant posits conspiracy by respondent’s officials in retaliation for a sexual harassment claim, which affected the contemplated exercise of the options. ... Indulging in every reasonable inference in favor of the appellant, as we must, we cannot say that there is no set of facts upon which appellant can prevail as to the alleged bad faith regarding the alleged forced cancellation of the contract and the subsequent nonexercise of option year three. Appellant pleads that there was a sexual harassment complaint filed and that there were significant deductions from appellant’s contract invoices after the filing of that complaint, deductions that appear to be greater than those taken before the filing of the complaint.” [The pdf version of the opinion contains unexplained yellow highlighting.-jaw]
APPEALS OF NOVA EXPRESS, PSBCA Nos. 5102,5104,5106, January 10, 2008. Appellant appeals the decision to not renew is contract claiming the government acted in bad faith. The PSBCA denies the appeal noting that the contract authorized renewal of the contract by mutual agreement of the parties and that “Under these circumstances, the contracting officer had wide discretion in deciding whether to renew the contract.” Citing Am-Pro Protective Agency, Inc. v. United States, 281 F.3d 1234, 1240 (Fed. Cir. 2002), the Board notes that it does “not find clear and convincing evidence that in deciding not to renew the contract Respondent's officials had specific intent to harm Appellant or that they were motivated by malice.”
Appeals of -- LABAT-Anderson, Inc., ASBCA Nos. 54904, 54905, 54906, December 31, 2007. Defense Supply Center contract. The Board denies appellant’s major claim finding that the ambiguity in the RFP was patent and plaintiff did not alert the government to the issue. Alternatively, the Board find that the interpretation by plaintiff was unreasonable. The Board does allow one claim finding that the government had implicitly waived the delivery date. The Board also denies a Prompt Payment Act interest claim finding that the matter was in dispute.
Appeal of -- Doyon Properties-American, JV, ASBCA No. 55842, December 17, 2007. Appellant submitted a claim certified by its subcontractor to the CO, and now appeals the denial of the claim. The ASBCA grants the government’s motion to dismiss for lack of jurisdiction as the certification was not by the prime. The Board rejects the argument by appellant that it adopted by reference the subcontractor’s certification.
Appeal of -- Lockheed Martin Corporation, ASBCA No. 55786, December 10, 2007. NAVAIR contract. Lockheed(LMC) appeals the alleged denial of a claim for interest on a partial convenience termination settlement. The parties had agreed on the amount of the termination settlement. Navy delayed payment because of funding problems. The Board dismisses the appeal for lack of jurisdiction, agreeing with the government that LMC never submitted certified claim in a sum certain was submitted to the contracting officer under the CDA for interest or for breach damages in connection with the delayed payment of the net termination settlement amount. The Board rejects LMC’s argument that its termination settlement proposal ripened into a CDA claim when the government failed to make payment. The Board notes that “A convenience termination settlement proposal ‘ripens’ into a CDA claim when there is an impasse in the negotiation of the settlement amount and the contracting officer issues a unilateral determination as expressly required by the Termination for Convenience clause of the contract. An appeal to the Board of that unilateral determination is also expressly provided by the clause. In LMC’s case, the termination settlement amount was agreed upon by the parties, there was no unilateral determination of that amount by the contracting officer, and the Termination clause of the contract does not provide for an appeal to the Board where a lack of government funding prevents payment of the agreed amount.”(citations omitted)
Appeal of -- KAMP Systems, Inc., ASBCA No. 55317, December 05, 2007. On reconsideration, based on new evidence, the Board reverses itself and finds that appeal filed via a commercial delivery service was untimely when received by the government on the 91st day. In a separate opinion by Judge Scott, she recognizes that neither FAR 33.211(a)(4)(v) or Board Rule 1(a) define “otherwise furnished” to the Board, nor do they elsewhere define “filing” with the Board. She recommends that the FAR and Board rule should “be clarified to express precisely how the Board determines the filing date of a notice of appeal.”
Appeal of -- Syracuse International Technologies, ASBCA No. 55607, November 30, 2007. DLA purchase order for electronic panels. A unilateral Purchase order was issued with delivery required by November 24, 2003. Contractor was advised on February 24, 2004, that the PO had lapsed and delivery would not be accepted unless shipped prior to February 24th. The items were received by the government on March 16, 2004, and were returned. Appellant appeals the denial of its claim for the purchase price, arguing, in part,, that the government waived the delivery date. The Board grants summary judgment for the government holding that “once a PO lapses, the government is under no contractual duty to provide appellant with notice of the lapse.”
BUTTE TIMBERLANDS, LLC, v. DEPARTMENT OF AGRICULTURE, CBCA No. 646, November 28, 2007. Forest Service(FS) timber sale contract. Butte appeals the denial of its proposal to modify the method used to harvest the timber, arguing that the FS “breached the contract and its duty of good faith by failing to properly consider the appellant’s request to modify the contract to use a different harvesting method from the one specified in the contract.” The FS moves for summary relief arguing that it has “unilateral authority to ‘approve’ requirements different than . . . [those set forth] in the contract,’ and ‘the parties did not bargain for a reasonableness standard.’” The Board denies the motion noting that “Based on the covenant of good faith and fair dealing inherent in every contract, all parties to a contract are charged with acting reasonably.”
PINNELL BROWN CONSTRUCTION, INC. v. DEPARTMENT OF VETERANS AFFAIRS, CBCA No. 917, November 16, 2007. VA contract, termination for default. The Board denies the motion by VA to dismiss the appeal as untimely filed. The Board notes “Agencies control the content and distribution of contracting officers’ decisions, and statute requires the decisions to provide sufficiently clear information to enable contractors to make informed choices concerning their appeal rights. ... Here, the agency provided the contractor with two versions of a decision, both of which expressly provided that the ninety-day time to appeal began to run ‘from the date you receive this decision’ and neither of which made clear which version was legally effective to begin the running of the ninety-day appeal period. The agency’s actions created understandable confusion as to when the time to appeal began to run and, as a result, Pinnell was entitled to rely upon the appeal language contained in the second version of the decision, which it did.”
Appeal of --Rex Systems, Inc.. ASBCA No. 54436. November 06, 2007. (See earlier decision in this case.) Navy contract. Appellant appeals the deemed denial of its claim for breach on an implied-in-fact contract contract restricting the use of its drawings. Appellant claims unjust enrichment and reasonable damages and “that at a minimum such reasonable damages or license fees for such unauthorized use of its trade secret information is 15% of the value of all transactions entered into, performed by or made possible by the Government unauthorized use of RSI’s trade secret information. ...” The government argues or the first time in its post-hearing brief that the appeal should be dismissed for lack of jurisdiction as the claimed damages were not stated in a sum certain. The Board agrees and dismisses the claims noting “There is a complete absence in the claim of any quantification of the ‘unjust enrichment’ to which RSI claims it is entitled, and the phrase ‘at a minimum’ modifying the claimed 15 percent license fee is indistinguishable from the modifying phrases ‘no less than,’ ‘not less than’ and ‘in excess of,’ which we have previously found to disqualify a stated amount as a sum certain.”
ACQUEST GOVERNMENT HOLDINGS, OPP, LLC, v. GENERAL SERVICES ADMINISTRATION, CBCA No. 413, November 07, 2007. Appeal of the denial of a claim submitted on behalf of a subcontractor. The government argues that the claim is barred by the Severin doctrine as the prime has been released from liability to the sub. The Board rejects the government’s motion for summary relief finding that “Acquest was not totally absolved of liability, and the Severin doctrine does not bar Acquest from sponsoring [the sub’s] claims submitted prior to the September 5, 2003, agreement. The Government has not met its burden of establishing an iron-clad release of those claims, ...”
Appeal of -- Wesleyan Company, Inc., ASBCA No. 53896, October 23, 2007. On remand from the decision of the CAFC. The Board concludes that the purchase orders did not incorporate by reference the confidentiality agreements applicable to the unsolicited proposals. However, the Board denies the government’s motion for summary judgment “because genuine issues of material fact remain as to whether the purchase orders as issued by the government were modified by tags reserving proprietary rights attached to the prototypes shipped by Wesleyan, and if so, whether the government breached the reservations.”
CORNERS AND EDGES, INC., v. DEPARTMENT OF HEALTH AND HUMAN SERVICES, CBCA No. 648, October 19, 2007. Appellant argues that the use of the term “approximately” in a purchase order extending its contract made the contract an indefinite delivery indefinite quantity (IDIQ) contract. The Board disagrees and denies the appeal. Judge Borwick notes “Appellant’s interpretation would render superfluous the ‘quantity ordered’ provision of eight months, and the grand total amount of $52,800 stated in the purchase order. The reasonable interpretation that harmonizes all provisions is the one proffered by the respondent, i.e., that the term ‘approximately’ was intended to provide respondent flexibility in ending the purchase order before July 31, 2005 ... ”
OMNI DEVELOPMENT CORPORATION, v. DEPARTMENT OF AGRICULTURE, CBCA Nos. 609-C, 610-C, October 17, 2007. EAJA case for some $713,000 in fees for its favorable decisions in overturning a default action and subsequent quantum breach claims. The CBCA denies the claims finding that the actions of the government were substantially justified. The board gives considerable emphasis to the earlier dissenting opinions on the merits to explain that the government’s position was substantially justified. Judge Pollack concurs with the denial of fees for the breach claim, but files a vigorous dissent on the portion of the decision dealing with the termination for default. Judge Pollack notes “that the dissent applied the wrong legal principles and relied on factual conclusions not supported by the record. Accordingly, the dissents in both AGBCA cases do not support a finding of substantial justification.”
CHARLES ENGINEERING CO. v. DEPARTMENT OF VETERANS AFFAIRS, CBCA No. 582, October 16, 2007. Construction contract for work at the Culpeper National Cemetery, Culpeper, Virginia. Appellant’s claims include some $256,000 for lost income allegedly caused by a constructive stop work order issued by the VA and appellant argues that because of the stop work order, and the resulting litigation with a subcontractor, it “was not able to compete for like government or civilian contracts.” The Board grants the government’s motion to dismiss for failure to state a claim. Judge Sheridan notes “For the respondent to recover lost income as damages for a breach of contract, the losses must be directly related to the contract that was breached. Lost profits are not recoverable if they result only from a contractor’s hope of additional contracts. Thus, even if this Board were to find that the respondent breached the contract in issue, the appellant cannot recover because the lost income it seeks is unrelated to the contract that was allegedly breached.”
Appeal of -- Paranetics Technology, Inc.. ASBCA No. 55329, October 12, 2007. Army fixed price requirements contract parachute assemblies for an aerial target drone. Appellant appeals from the denial of its unabsorbed overhead claim for some $105,000 caused by the delay when a suggested source on a government specification control drawing went out of business. The Board denies the appeal finding that the part in question was not an sole source item and noting that “the drawing expressly disclaimed responsibility for the ‘present or continued availability’ of the item from the suggested source.”
Appeal of -- Conner Bros. Construction Company, Inc., ASBCA No. 54109, October 11. 2007. Corps of Engineers construction contract at Fort Benning. Appellant appeals the denial of its claim for increased costs when it was denied access to the work site for 41 days following the terrorist attack on September 11, 2001. The site in question was being used by the Rangers as they prepared for operations in Afghanistan. The ASBCA denies the appeal agreeing with the Corps defense that the denial of access was a sovereign act. In rejecting appellant’s argument that the exclusion was not a “public and general act” the Board notes “First, the power to exclude civilians from a military base stems from the war-making powers” .... , “Second, the exclusion order of Conner and its subcontractors from the Ranger compound was incidental to the accomplishment of a broader governmental objective.” ... , and “Third, the exclusion was not directed principally or primarily at Conner’s contractual rights.”
Appeal of -- Cubic Defense Applications, Inc., ASBCA No. 56097, October 02,2007. Navy contract. After failing to reach agreement on a REA, Cubic submitted a certified claim on April 23, 2007, that, for the most part, tracked the REA. On June 14, 2007, the CO acknowledged receipt of the claim and informed Cubic that the government “intends to respond approximately December 14, 2007.” On July 03, 2007, Cubic filed this appeal on the basis that the CO had failed to issue a decision. The Board rejects the government’s motion to dismiss the appeal as premature. Judge Ting accepts the appeal, noting “Instead of establishing a fixed date on which his decision will be issued, the CO in this case hedged and stated only that ‘SPAWAR intends to respond approximately December 14, 2007.’ We cannot conclude that the CO’s notification complied with 41 U.S.C. § 605(c)(2)(B). First, ‘approximately December 14, 2007’ did not provide a fixed or specific date. Second, the CO did not commit to issuing a decision; he only stated that ‘SPAWAR intends to respond.’ Both the CO’s own intention and the nature of the response were unclear.”
INVERSA, S.A., v. DEPARTMENT OF STATE, CBCA No. 440, October 03.2007. Appellant appeals the denial of its some $33 million claim for the purported breach of a letter of intent to lease certain premises that appellant was to build. The CBCA dismisses the claim for lack of jurisdiction finding that the letter of intent was not a valid CDA procurement contract. Reviewing the provisions of the letter on intent, Judge Borwick notes that “conditional willingness to lease space in the future is not a binding acceptance.” He summarizes the letter as follows - “the letter of intent merely records the willingness of the parties to enter into a lease or leases at a future, but indeterminate, date, for an unknown number of apartments of unknown design, at undefined rental rates, with undefined rental periods, when the project was built, if ever. Additionally, there were no binding provisions for amenities, cleaning, or services stated in the letter of intent. The letter of intent is simply too empty a vessel from which to conjure up a binding offer and acceptance which would form a procurement contract cognizable under the CDA.” In any event, the Board also finds that the State Department employee who signed the letter had no authority to execute a lease.
INNOVATIVE (PBX) TELEPHONE SERVICES, INC., Appellant, v. DEPARTMENT OF VETERANS AFFAIRS, CBCA Nos. 12, 33, 365, 366, 367, September 27, 2007. Appellant appeals the denial of its $6 Million claim based on bad faith, racially discriminatory actions by a VA employee. The Board dismisses the appeal for lack of jurisdiction noting that appellant has failed to show that the alleged actions were “tied to a provision in, or performance of, a contract. ”
Appeal of -- The Swanson Group, Inc., ASBCA No. 54863, September 24, 2007. Navy contract. The Board holds that a request for an extension of time to file a T/C settlement proposal which was mailed to the government attorney of record in a matter was timely when mailed within the one year period.
Appeals of -- Tecom, Inc., ASBCA Nos. 53884,54461, September 21, 2007. (Synopsis by list member Johnathan M. Bailey) An interesting decision our office just obtained providing some clarity to contractors and the Government regarding the reach of Boeing North American v. Roche, 298 F.3d 1274 (Fed. Cir. 2002). The ASBCA in the attached decision holds that contractor legal fees and settlement payments in defense Title VII suits are not subject to the “likelihood of success” allowability test announced in Boeing. The Board also holds that such costs are not barred by FAR 31.205-15’s bar against allowability of fines and penalties.
ADMIRAL ELEVATOR v. SOCIAL SECURITY ADMINISTRATION, CBCA No.470, September 19, 2007. Contract for elevator maintenance. Appellant appeals the denial of its claim for costs caused by the government’s failure to have elevators available for service. The CO had denied the claim arguing that the unavailability of the elevators was a constructive termination for convenience. The CBCA finds for appellant noting “What is critical is that the agency’s representations were erroneous, that the agency directed offerors to rely on them in constructing their pricing schemes, and that the successful offeror did indeed rely on those misrepresentations.” Rejecting the constructive T/C argument Judge Daniels stated “Here, no circumstances existed which might have justified the reallocation of risk to Admiral. The sole purpose of the purported partial termination was for SSA to unilaterally renegotiate the contract, after years of performance by Admiral which were sufficiently good that SSA exercised its options to continue the contract, so as to reduce SSA’s financial liability.”
Appeal of -- DLT Solutions, Inc., ASBCA No. 55822,
August 30, 2007. Appellant’s appeal was dated and received by the
Board on a Monday, 91 calendar days after receipt of the decision. Board
Rule 33 provides
“(b) In computing any
period of time, the day of the event from which the designated period of
time begins to run shall not be included, but the last day of the period
shall be included unless it is a Saturday, Sunday, or a legal holiday,
in which event the period shall run to the end of the next business
day.”
The government moves to dismiss arguing that Rule 33
cannot trump the statutory 90 day limit of the CDA and that “once
a statutory period is established, only congress can lengthen this
period.” After discussing the issue and case law, the Board denies
the motion relying on Wood-Ivey Sys. Corp. v. United States, 4 F.3d 961
(Fed. Cir. 1993).
Appeals of -- Altos Federal Group, ASBCA Nos. 53523, 54404, August 23, 2007. Navy fixed price contract. Appellant claims mistakes arising from its alleged use of a Wage Determination that was issued by DOL, but not incorporated in the contract. In an opinion by Judge Page the Board denies the appeal finding the “AFG failed to satisfy the requisite elements of proof for reformation due to a mutual mistake or an equitable adjustment” Good discussion of mistake issues.
Appeal of -- Armstead & Associates, Inc., ASBCA No. 52610, August 22, 2007. Air Force requirements contract. Appellant appeals from the denial of its claims for service and maintenance calls allegedly in excess of stated estimated quantities. The original claim was for the base year, but appellant submitted an amended REA for the option years. The Board dismisses for lack of jurisdiction the claims for option years finding that “All of the prerequisite facts for filing a claim with respect to the first and second option years existed when Armstead filed its claim for the base year. Armstead did not amend its claim before the CO issued his final decision. On the basis of this peculiar fact pattern, we lack jurisdiction to review Armstead’s claims for the first and second option years.” The base year claim is denied for failure of proof.
Appeal of -- Raytheon Company ) ASBCA No. 54907, August 21, 2007. Appellant appeals an apparent government claim that “appellant failed to comply with CAS 413.50(c)(12), insofar as it failed to timely pay the government’s share of a pension fund surplus with respect to the sale of two business segments (‘segment closings’), and that the government is entitled to interest, compounded daily, on the increased costs paid by the government due to this noncompliance as a matter of law.” The Board upholds the claim and grants the government’s motion for summary judgment.
ALLEN
BALLEW GENERAL CONTRACTOR, INC., Applicant, v. DEPARTMENT OF VETERANS
AFFAIRS, CBCA Nos. CBCA 3-C(VABCA 6987E), 24-C(VABCA 7042E),
25-C(VABCA 7043E), August 15, 2007. EAJA case, Department of Veteran
Affairs. The Board denies the EAJA claim finding that the
government’s position was substantially justified. The Board
relies, in part, on the discussions held by parties, documented in the
appeal file, during the course of the contract. In an interesting twist,
the government apparently objected to consideration of these documents.
Judge Sheridan notes “We are
confounded as to how the respondent possibly could object to our
consideration of the VA’s proposals during the case-in-chief. The
respondent appears to mistake what seems to us to be the routine
exchange of proposals regarding a contract modification—which
regularly occurs during any contract—to be the type of conduct or
statement ‘made in compromise negotiations regarding the
claim’ that may be prohibited as use as evidence under rule 408(a)
of the Federal Rules of Evidence. The negotiations regarding
modification 6, which the VA characterizes as ‘settlement
discussions,’ were actually exchanges between the contracting
officer and the contractor relating to a change order made during the
administration of the contract. While we wholly agree that settlement
offers made on claims should not be relied upon as proof of a claim, an
exchange the like of which occurred here may certainly be considered.
Furthermore, the Government itself put into evidence the information
about the early proposals that it made to resolve the delay issue when
it included documentation regarding the proposals in its appeal file
submission. Also, and ironically, while the Government objects to the VA
Board’s consideration of the proposals associated with the
modification, it is those very proposals that first point to the
reasonableness of the VA’s approach in dealing with the matters
that gave rise to this litigation.”
BEYLEY CONSTRUCTION GROUP CORPORATION, v. DEPARTMENT OF VETERANS AFFAIRS, CBCA Nos. 5, 763, July 23, 2007. Department of Veterans Affairs contract for development of burial areas at the Puerto Rico National Cemetery. Appellant experienced difficulty in excavating an area (a mogote) and claimed a differing site condition. The government denied there was a differing site condition, but issued a change order deleting the excavation work from the contract and reducing the contract amount. Appellant appeals the denial of its claim for increased costs due to the need to import fill material rather than use fill from the area that was originally to be excavated. Appellant argues that the change was a cardinal change. The Board grants the appeal, in part. In an opinion by Judge Sheridan, the Board agrees that there was probably a differing site condition,, but does not decide on that basis. Instead the Board finds that the change was a constructive change entitling appellant to a portion of its increased cost. The Board notes that deleting the excavation deprived appellant the source of fill it planned to use on the project.
Appeal of -- Advanced Communications Systems, ASBCA No. 52592, July 12,2007. The board grants appellant’s motion to change its name to Systore Companies, Incorporated doing business as Advanced Communications Systems, finding that such is not a novation and that the government relied, in part, on a D&B report by that name when determining the contractors responsibility. The government argues that the appeal should be dismissed because Systore’s corporate charter had been cancelled and had not been reinstated when the claim was submitted and when the appeal from the contracting officer’s denial was filed. The board denies the government’s motion stating that it will defer until a hearing to determine whether appellant’s principal can be examined under oath as to when he had actual knowledge of the cancellation, as required by Ohio law.
THE BOEING COMPANY, SUCCESSOR-IN-INTEREST OF ROCKWELL INTERNATIONAL CORPORATION, v. DEPARTMENT OF ENERGY, CBCA Nos. 337, 338, 339, July 09, 2007. The Board holds that a contractor who violates the False Claims Act (FCA), 31 U.S.C. §§ 3729-3733, cannot recover its defense costs as allowable costs under the contract.
TAS GROUP, INC., Appellant, v. DEPARTMENT OF JUSTICE, CBCA No. 52, July 02,2007. TAS appeals the denial of its claim for damages to a helicopter provided by a subcontractor. The government argues that under a contract clause which provided in part that “The Government shall not be held liable for any injury to the Contractor’s property ... “ the Government is only liable for damages to the prime contractor’s property. The Board rejects the argument holding that “The contract does not distinguish between the prime contractor and the subcontractor. The terms of the contract and the actions of the parties support the conclusion that the term “subcontractor’ is subsumed within the term ’contractor’ for the purpose of the requirements of the contract. Accordingly, we find that the Government actions could lead to liability to the subcontractor as well as to the prime.”
GREENLEE CONSTRUCTION, INC., v. GENERAL SERVICES ADMINISTRATION, CBCA Nos. 415, 448, July 02, 2007. GSA IDIQ construction contract for partitioning and miscellaneous repairs. GSA terminated the contact for convenience after Greenlee failed to provide a price proposal for a bond required by a government change. No work was ever performed by Greenlee. Greenlee appeals the denial of its claims for breach and termination for convenience. The Board denies both appeals and also notes “Even if the failure to provide a price proposal for the bonds might be deemed to be insufficient justification for a termination for convenience, the uncontested record shows that the contracting officer had another, ample reason for issuing the termination: Greenlee was a consistently uncooperative contractor, and it is unquestionably in the Government’s interest to be free from such a party.“
Appeal of -- Honeywell International, Inc., ASBCA No. 54598, June 20, 2007. Navy ID/IQ contract. Appellant claims it is entitled to have prices renegotiated for purchases by the Navy in excess of the maximums specified in the contract. The contract provided that “... Contractor shall honor any order exceeding the maximum order limitations in paragraph (b), unless that order (or orders) is returned to the ordering office within 15 days after issuance, ... “ Appellant did not return the orders, but instead filled them. The Board denies the appeal finding that “appellant, for business reasons, did not timely protest respondent’s issuance of the 63 orders exceeding the maximum quantity of 100 for the first year of the ordering period, which failure is fatal to recovery.”
MOTION FOR COSTS AND ATTORNEY FEES DENIED: MOUNTAIN VALLEY LUMBER, INC., v. DEPARTMENT OF AGRICULTURE, CBCA 95, June 21, 2007. Forest Service contract. See earlier decisions in this case. Judge Pollack denies appellant’s request for the award of costs and attorney fees as sanctions on the Government for discovery abuse. Judge Pollack rejects the argument that the CDA provision which provides that “agency board is authorized to grant any relief that would be available to a litigant asserting a contract claim in the United States Court of Federal Claims” [41 USC 607(d)(2)] is a waiver of sovereign immunity allowing a Board to award fees as sanctions for discovery abuse. Very good discussion sovereign immunity issues as relevant to a Board’s authority to award fees.
Appeals of -- Business Management Research Associates, Inc., ASBCA Nos. 55309, 55862, June 1, 2007. Appellant submitted a certified claim to the HHS contracting officer on November 3, 2006. On May 3, 2007, appellant filed a notice of appeal from the failure of the contracting officer to issue a decision on its 3 November 2006 claim. After finding that the November 3, 2006 claim was a new claim, the Board, sua sponte dismisses the appeal for lack of jurisdiction noting that with the creation of the CBCA on January 6, 2007, the ASBCA no longer has jurisdiction of new HHS appeals.
Appeals of -- ICI Americas, Inc., ASBCA Nos. 54877, 55078, May 23, 2007. Army contracts. Appellant appeals the final decisions on the disposition of actuarial surpluses in government-funded pension plans. The Boards sustains in part and denies in part the appeals. The Board denied both parties motions to exclude expert testimony under Rumsfeld v. United Technologies Corp., but states it will afford individual portions the appropriate weight in light of the parties’ objections.
ROBERT T. RAFFERTY v. GENERAL SERVICES ADMINISTRATION, CBCA No. 617, May 10,2007. GSA moves to dismiss for lack of jurisdiction an appeal filed more than 90 days after the CO’s decision was received as indicated by the return receipt of certified mail. Appellant opposes the dismissal stating that he is often on travel and did not receive the CO’s decision. The Board finds that the government has carried its burden in proving receipt and dismisses the action. The Board notes “where the appellant is an individual and the envelope containing the decision is accepted ... at the appellant’s address, unless the appellant can show that the individual who accepted the letter had no authority to do so, the decision is considered to have been received and the appeal time begins to run when the letter is accepted.”
Appeal of -- Systems Integrated, ASBCA No. 54439, May 10, 2007. Navy cost contracts. The Board concludes that “appellant is entitled to a negotiation of an equitable distribution [of property] under the LOC clause of these contracts.” Although the Board finds that appellant unreasonably delayed the submission of its claim the Board denies the government’s laches motion finding that the government was not prejudiced.
Appeal of -- ESA Environmental Specialists, Inc., ASBCA No. 55620, May 08, 2007. Air Force contract. The government argues that matter should be dismissed based on the timeliness of appeal, which was due to be filed by October 03, 2006, but was not received by the Board until October 10, 2006. The CO’s final decision did not provide an address for either the ASBCA or COFC. The Board holds that the appeal was timely as it was first received by the CO on September 29, 2006, in a letter from appellant that noted that it had not received an answer to its request for the address of the Board and also requested that the CO forward the appeal to the Board.
Appeal of -- Fiber Materials, Inc., ASBCA No. 53616, April 17, 2007. DOD cost plus fixed fee contracts. Contractor appeals from an ACO’s decision unilaterally establishing indirect overhead and general and administrative rates and assessing administrative penalties for appellant’s alleged inclusion of expressly unallowable costs in its indirect cost proposals. The Board rejects the argument that the costs defending criminal charges relating to a violation of export control laws in one of its commercial contracts were allocable to the government contracts at issue. Judge Rome notes that “appellant has not established that the legal costs were necessary to the operation of its business (see finding 34), and there is no nexus between the costs it incurred in the criminal proceeding and the contracts at issue in this appeal, or any federal government contract.” Opinion discusses legal costs, indirect cost issues and associated administrative penalties.
KEY FEDERAL FINANCE v. GENERAL SERVICES ADMINISTRATION, and DEPARTMENT OF COMMERCE,CBCA Nos. CBCA 411, 412, April 19, 2007. Commerce moves to dismiss for lack of jurisdiction arguing that appellant was not a named contractor in the subject contract. The contract was a lease to own transaction for computer equipment and offerors were required to hold GSA FSS contracts. The contract was awarded to James River Technical, Inc. (JRTI) and appellant was a team member that offered leasing terms in its GSA FSS contract. The Board denies the motion to dismiss. Judge Stern notes that “The order made specific reference to the ‘Teaming Arrangement between James River and Key Federal Finance.’ Subsequently, Commerce recognized the assignment to issue all money due under the contract to Key. Ultimately, the contract was terminated by GSA’s reference to a clause in Key’s FSS contract.” Judge Stern concludes “The circumstances of this case indicate that a special relationship was created between Commerce and Key that went beyond the normal contract structure in which the Government only deals with the named contractor and that contractor deals with its subcontractor. Both the requirements of the solicitation and Commerce’s actions before and after award created a contractual relationship between it and Key and permitted the two parties to deal directly with each other. By these actions, the parties indicated an intent to be in privity under this contract. Commerce may not now deny the relationship it created. Key is in privity with Commerce under this purchase order. Key is a contractor as that term is used in the CDA.”
Appeals of -- Ellis Environmental Group, LC, ASBCA Nos. 54066, 54067, April 09. 2007. Contractor appeals the denials of claims from two sole source 8(a) construction contracts for an equitable adjustment for the payment of a Mississippi use tax. Both contracts contained FAR 52.229-4, FEDERAL, STATE, AND LOCAL TAXES (NONCOMPETITIVE CONTRACT). The Board denies the claims for reformation based on an unilateral mistake. Although agreeing that there was an unilateral mistake,Judge Shackleford concludes “that the failure to ascertain the nature and extent of taxes required by the State of Mississippi was not a clear-cut clerical error or mathematical error. Nor, was it a misreading of the specifications. Rather, it was a judgmental error. The contract and case law placed the burden of ascertaining which taxes are applicable squarely on EEG. EEG included a Florida sales tax in its estimate but neglected to ascertain the nature of taxes required in the State of Mississippi. Consequently, the mistake made was not a qualifying mistake that would entitle EEG to reformation.”
TIDEWATER CONTRACTORS, INC. v. DEPARTMENT OF TRANSPORTATION, CBCA No. 50, March 22, 2007. DOT contract for road work. Claim for extension in time for completion for failure of the government to issue a notice to proceed in a timely fashion. The contract envisioned that the notice to proceed would be issued 70 days after bid opening and after approval of contractor submittals. Prior to the approval of submittals the government issued an “off-site” notice to proceed. In granting a portion of the delay claim the Board addressed the issue of “whether the contract, the Federal Acquisition Regulation, or any other applicable regulations authorized the Government to issue an off-site notice to proceed, followed by a separate notice to proceed with work on site.” The Board rejects the government’s argument that the off-site notice to proceed was authorized by FAR FAR 1.102-4(e) “Role of the acquisition team” permitting the team to “innovate and use sound business judgment” The Board notes that the provision does not apply because FAR 11.404(b) (referencing FAR 52.211-10) specifically addresses the issuance of a notice to proceed.
MOUNTAIN VALLEY LUMBER, INC., CBCA No. 95, March 07.2007. FS contract. Appellant moves to compel the production of DOJ documents, which were prepared for an earlier and now completed case. See earlier decision on discovery aspects of this case. Judge Pollock denies the motion finding that the documents are covered by the work product privilege. Good discussion of the work product privilege and related case law, and as Judge Pollack states the “three-way split of authority as to what standard to apply.” Judge Pollack finds “that the better authority and the authority with the greatest support is that the privilege continues notwithstanding the termination of a case. Further, ... that the better case law holds that the privilege should be sustained even if the litigation is not related.” In rejecting appellant’s argument that “the best, and possibly only, evidence of whether the FS actions were unreasonable was the objective advice the FS received during the [now completed earlier] case, focusing here on legal advice from DOJ.” He notes that “Certainly, advice and opinions from individuals within and outside the FS would likely be useful in determining the reasonableness or unreasonableness of the FS actions. However, the actions themselves, not someone’s take on them, are the central issue here.
Appeal of -- All-State Construction, Inc., ASBCA No. 50586, February 26, 2007. Appellant moves for reconsideration of the decision upholding a termination for default for “a continuous breach of its Disputes clause obligation to proceed diligently with performance pending final resolution of its claims.” In denying the motion for reconsideration the Board notes “The diligent performance required by the Disputes clause is not governed by the disputed critical path and time extension claimed by All-State, but by the existing contract completion date and the work that could be reasonably performed to advance the project pending resolution of the dispute.”
Appeal of -- AM General LLC,
ASBCA No. 53610, February 23, 2007. Appellant asks for reconsideration
of the earlier decision by the
Board “holding that AM General’s single indirect cost pool
for accumulating and allocating manufacturing overhead to its military
HMMWVs and the commercial HUMMERs is not homogeneous and in violation of
CAS 418.” The Board rejects the government’s argument that
the Board should not consider an amicus curiae brief filed by
NDIA. The Board grants the motion for reconsideration noting “it
has now become clear that the facts the parties provided initially in
support of and in opposition to the government’s cross-motion for
summary judgment fall short of what we believe is necessary to establish
whether AM General’s post-September 1995 manufacturing overhead
pool is not homogeneous and in violation of CAS 418.
For the
foregoing reasons, we hereby vacate that portion of our 2 February 2006
decision granting summary judgment in favor of the government on the
basis that AM General’s manufacturing overhead pool is not
homogeneous and in violation of CAS 418.”
Appeal of -- Trawick Contractors, Inc. ASBCA No. 55097, February 23, 2007. Navy construction contract. Appellant argues that the CO entered into an oral agreement for remission of liquidated damages. The Board denies the claim noting that “The alleged oral agreement here in issue necessarily would change the contract price, as established pursuant to the contract’s Liquidated Damages clause. The parties do not dispute the material fact that they did not execute a written modification to settle the government’s liquidated damages claim for $30,000, and hence to change the contract price by that amount.”
SILVER ENTERPRISES v. DEPARTMENT OF TRANSPORTATION, CBCA No. 63-C, February 20, 2007. EAJA case, Department of Transportation contract for the Research and Innovative Technology Administration (RITA). Although the Board finds that appellant meets the eligibility requirement and was the prevailing party, the application is denied as the position of the government was substantially justified. The Board explain the decision’s concluding paragraph. “Here, RITA made several requests to Silver for documentation in support of its termination claim. Silver provided no records of the time it spent on contract performance. RITA rejected Silver’s various settlement proposals based upon its failure to support its claimed costs. The Department of Transportation Board of Contract Appeals found that applicant failed to keep adequate records, so the exact amount of time spent by appellant on contract work could not be determined. The board made an award based on the jury verdict approach. The board had to estimate Silver’s costs due to the inadequate supporting documentation. The record before the board included the sworn testimony of Silver’s owner. RITA did not have this evidence before it. RITA stated that it would only pay those costs that were supported by appropriate documentation. RITA made a settlement determination of $5220.23 (as revised). We cannot find that this position was unreasonable in light of applicant’s failure to keep adequate records of its costs. RITA has carried its burden. We find its position was substantially justified.”
Appeal of -- Environmental Safety Consultants, Inc., ASBCA No. 54615, January 31, 2007. Navy construction contract. The Board finds that “appellant’s claim is untimely under Section 6(a) of the CDA, as amended by FASA, 41 U.S.C. § 605(a), [and] hold[s] that [it] [has] no jurisdiction. Accordingly, we dismiss the appeal with prejudice.” The 44 page decision describes the rather complicated background involving several alleged claims and earlier litigation of surety matters in an earlier Federal District court decision. Good discussions of the requirements of claims under the CDA.
Appeal of -- Transtar Metals, Inc., ASBCA No. 55039, January 24, 2007. DISC IDIQ contract for aluminum. The government met its 10 per cent minimum order obligation, but appellant claims breach based on alleged misrepresentation of estimated quantities. The Board grants summary judgment for the government stating “even assuming, arguendo, that the government possessed superior knowledge and negligently misrepresented and misstated the annual quantity estimates in the solicitation and the contract, this is not material because the government met its purchase obligations under the contract.”
Appeal of -- C.F. Jordan, L.P., ASBCA No. 55532, January 22, 2007. Navy construction contract. Appellant appeals the denial of its claim for contract adjustment under the Indian Incentive Program which was added to the Indian Financing Act of 1974, 25 U.S.C. §§ 1451-1544, on 22 September 1988. Plaintiff had subcontracted to an Indian firm(Leetex) and the Leetex had the work performed by a Non-Indian firm. The Navy SADBU office ruled that the adjustment would apply only to work by the Leetex firm’s own forces. Based on its analysis of the statute the Board finds for appellant both of its arguments “First, ... that the Indian Incentive Program does not require the Indian organization to perform the work with its own forces or restrict it from subcontracting the work to a non-Indian organization. Second, ... the incentive payment is to be based on the amount paid to the Indian organization.”
BUSINESS MANAGEMENT RESEARCH ASSOCIATES, INC. v. GENERAL SERVICES ADMINISTRATION CBCA No. 464, January 18, 2007. In the first decision of the new Civilian Board of Contract Appeals the full Board holds “that the holdings of our predecessor boards shall be binding as precedent in this Board.” On the merits the Board determines that GSA’s termination for cause was justified.
Appeal of -- Lockheed Martin Aircraft Center, ASBCA No. 55164, January 11, 2007. Navy requirements contract. The government moves to dismiss on the ground that the claim is not in a sum certain. “The government maintains that the CO ‘cannot compute the sum certain due from the information provided in the claim documents’ because the claim fails to: (a) include direct costs; (b) show how costs are to be spread or allocated among various types of line items; (c) demonstrate how costs are to be allocated over option years; and, (d) explain whether new prices should apply to all line items or to selected ones.” The Board denies the government’s motion following H.L. Smith, Inc. v. Dalton, 49 F.3d 1563, 1565 (Fed. Cir. 1995) which held “The contractor may supply adequate notice of the basis and amount of the claim without accounting for each cost component.”
Appeals of -- Dick Pacific/GHEMM JV, ASBCA Nos. 55562, 55563. January 04, 2007. Contractor appealed CO’s final decisions 125 days after receipt of the decisions. Government moves to dismiss the appeals with prejudice as untimely for failure to meet the 90 day limit of the CDA. The Board agrees it has no jurisdiction and dismisses the appeals, but without prejudice. The Board considers a case cited by the government which dismissed an appeal with prejudice, but interprets that holding “as being with prejudice to re-filing at the Board.”
Appeal of -- Aim Construction and Contracting Corp., ASBCA No. 52540, December 28, 2006. Corps of Engineers contract at the U.S. Military Academy, West Point, NY. Claims include allegations that government employees “conspired to knowingly and willfully engage in a pattern of wrongful conduct towards Aim and its principal for the purposes of hindering Aim’s contract performance, destroying Aim’s business and reputation, and that of its principal, and to effectively debar Aim from future public contracting.” The Board grants the government’s motion to dismiss for lack of jurisdiction finding that the claims lie in tort, for which the Board has no jurisdiction.
Appeal of -- Demusz Manufacturing Company, Inc., ASBCA No. 55311, December 18, 2006. Air Force contract. Contractor appeals a termination for default for failure to deliver production units. The Board grants the government’s motion for summary judgment. The Board rejects all of appellant’s arguments. The opinion notes that even if the government required a sole-source supplier, the government did not warrant the performance of the supplier.
Appeal of -- Emerson Construction Company, Inc., ASBCA No. 55165, December 08, 2006. Army requirements contract for construction services. Appellant appeals the denial of its claim for an equitable adjustment under Variation in Estimated Quantites clause in the contract. The Board rejects the government’s argument that the VEQ clause was not applicable to this firm-fixed-price, requirements type construction contract, but only,to the individual delivery orders. The Board grants summary judgment for appellant holding that the “this contract” language of the VEQ clause “indisputably refers to the overall requirements contract.”
TAS Group (CSI Aviation Services, Inc., subcontractor), v. U.S. DEPARTMENT OF JUSTICE, U.S. Marshals Service, DOTBCA No. 4535, November 16, 2006. Contract to supply aircraft to the U.S. Marshals Service(USMS). The prime, TAS, delegated the entire performance of the contract requirements to CSI, the subcontractor. Appeal is from a claim brought on behalf of the sub for damages to the aircraft. Appellant alleges that the pilots negligently damaged one of the aircraft during a USMS mission. The government moves for summary judgment on the grounds that, pursuant to the Severin doctrine, TAS does not possess standing to assert the claims of the subcontractor against the United States. The government contends that a clause in the contract between the prime and sub expressly immunizes TAS from any other claims arising from the performance of the subcontract. Judge Somers denies the government’s motion noting that “The burden of establishing that the prime contractor has no liability to its subcontractor for the latter’s damages is on the government. (citations omitted) A prime contractor is precluded from maintaining a suit on behalf of its subcontractor only when a contract clause or release completely exonerates the prime contractor from liability to its subcontractor.” She further finds that “In this case, the government has not established that an iron-clad release or contract provision in the subcontract completely immunizes TAS from any and all liability to the CSI for the alleged government negligence.” Good discussion of Severin doctrine.
Appeal of --Gosselin World Wide Moving NV, ASBCA No. 55365, October 25, 2006. Appeal by a contractor for transportation services of the failure of the CO to issue a decision on a claim for interest penalties under the Prompt Payment Act(PPA). The government moves to dismiss arguing that the Board has no jurisdiction over any claim, including Prompt Payment Act interest, “since ICA[the Interstate Commerce Act] does not ‘grant the ASBCA subject matter jurisdiction over actions between a common carrier and the government for the payments owed on their agreement,’” The Board denies the government’s motion and Judge Ting concludes “Because Gosselin’s appeal does not involve the performance of the underlying contract for transportation service ... but involves interest penalties under the PPA, and because the PPA applies to DoD, and designates the CDA as the statute for resolving PPA interest penalty disputes, we hold that the ASBCA, as the agency board designated for resolution of DoD CDA appeals, has jurisdiction to decide this appeal.”
Appeals of --Guarino Corporation, ASBCA Nos. 55015, 55028, October 23, 2006. Washington Metropolitan Area Transit Authority (WMATA) contract. The contract included a provision, Article 1.52 PRICING OF ADJUSTMENTS - INTEREST EXCLUDED,which contained, in part, the following language-“b. Notwithstanding any interpretation of the aforementioned Contract cost principles and procedures to the contrary, the Authority shall not be liable for interest, however represented, on or as a part of any claim, request, proposal or adjustment (including equitable adjustments) whether said claim, request, proposal or adjustment (including equitable adjustment) arises under the Contract or otherwise.” Appellant claims consist of interest expense and financing charges as a result of some 19 years in delay by WMATA in making payment to appellant. WMATA moves for partial summary judgment “of appellant’s complaint insofar as they demand more than $444,361 in interest for alleged underpayment and non-payment for 19 years.” The Board grants the government’s motion finding that “WMATA has met its burden in its motions for partial summary judgment by showing that the funds sought by appellant are in the nature of interest and, not only did the contracts not provide for the payment of interest on any claim for equitable adjustment, the contracts, at Article 1.52(b), encompass a comprehensive exclusion for WMATA’s liability for the payment of interest.”
Appeal of -- Todd Pacific Shipyards Corporation, ASBCA No. 55126, October 18, 2006. Navy contract. Appellant appeals the denials of its certified claims and makes several requests in its complaint that the Board award “additional amounts as may be due to Todd stemming from the Navy’s breach of the Contract.” The government moves for a partial dismissal arguing “that the Board lacked jurisdiction over the appeal because appellant’s complaint had revised its claim by demanding additional indeterminate amounts and by seeking unquantified future legal costs, rendering the claim one that was not in a sum certain.” The Board denies the government’s motion finding that the allegations in the complaint are based on he same operative facts which formed the basis of its claims. Judge Rome summarizes- “appellant’s certified claim to the CO was a valid CDA claim in a sum certain. Its complaint does not assert new claims that were not submitted to the CO.”
PROTEST OF: CAPITOL PAVING OF D.C., INC., DCCAB No. BP-0736, October 12, 2006. Capitol argues that the contracting officer should not have found that the awardee was entitled to a 10 percent bid preference as a “longtime resident business” ("“LRB”) - a new form of preference instituted pursuant to the recently enacted Small, Local, and Disadvantaged Business Enterprise Development and Assistance Act of 2005, D.C. Law 16-33 (“SLDBEDA Act”). The Board denies the protest concluding that “there is no basis in the law or the facts here to justify our reviewing the legitimacy of the action by the SLBOC [the Small, Local Business Opportunity Commission] to certify Fort Myer as an LRB.”
Appeal of -- Bean Stuyvesant L.L.C., ASBCA No. 53882, October 05, 2006. Corps of Engineers dredging contract, Type 1 differing site condition claim. Appellant claims that the subsurface conditions actually encountered differed materially from those indicated in the contract. Writing for the Board, Judge Delman concludes “that appellant failed to prove by a preponderance of the evidence that the conditions indicated in the contract documents differed materially from those conditions actually encountered; that the latter conditions were reasonable unforeseeable based upon all the information available to the contractor at the time of bidding; and that it reasonably relied upon its interpretation of all contract and contractÐrelated documents. Having failed to prove these elements of a Type I differing site condition, appellant’s claim is denied, and we need not address any other prerequisites for recovery, nor the other grounds asserted by the government for denying the claim.”
AMEC CONSTRUCTION MANAGEMENT, INC. v. GSA, GSBCA No. 16223, September 26, 2006. GSA construction contract. Appellant claims some $1.6 million in “General conditions costs.” The Board denies the appeal. Noting that “many trees have been felled to produce enough paper to print the results of the parties' efforts to explain the case to us”, Judge Daniels finds that appellant’s claim is based on a fundamental misunderstanding of the contract and that the Board is “especially regretful that the trees were not allowed to live.”
Appeal of -- HAM Investments, LLC, ASBCA No. 55070, September 19, 2006. Army contract. Appellant is a purported assignee of the prime contractor and claims that the Army should have paid it rather than the prime. The ASBCA dismisses for lack of jurisdiction holding “an assignment of proceeds arising from a government contract cannot establish or create a contractual relationship between the government and the assignee. Even if the government had acknowledged the assignment, the assignment would be an agreement between FSS and HAM only. Thus, HAM lacks the requisite privity and is not a party to the contract with the government.”
Appeal of -- General Injectables & Vaccines, Inc., ASBCA No. 54930, August 31, 2006. Termination for default of a flu virus vaccine contract. Board upholds the default for failure to deliver the flu virus vaccine even though appellant’s supplier, a United Kingdom firm, was prohibited by the UK from shipping the vaccine and by the US from importing the vaccine. The Board examines and rejects the three arguments raised by appellant — “(1) there was no default because the conditions precedent to [appellant’s] obligation to perform under the delivery contract at issue . . . had not been met . . . ; (2) there was no default because [appellant’s] duty to deliver was excused by operation of law, i.e., FDA refusal to permit the release of Fluvirin® into the United States, FDA embargo of Fluvirin® from Great Britain, the acts of the CDC . . . to control the distribution of Fluvirin¨ only to individuals on a government approved priority list . . . ; (3) Chiron was not a subcontractor of [appellant], and [appellant] had no liability under the contract for Chiron’s inability to ship flu vaccine . . . ;”
Appeal of --Valenzuela Engineering, Inc., ASBCA No. 54490, August 28, 2006. Corps of Engineers construction contract. The Board grants partial summary judgment for appellant allowing its claim arising from a suspension of work to proceed. The Board rejects the government’s argument that there was an accord and satisfaction of the claims. The Board notes “An essential element of an accord and satisfaction is proof of a meeting of the minds of the parties as to the matter compromised. [citations omitted] Clearly, there was no meeting of the minds as to the compromise or waiver of these potential claims. Appellant’s reservations of rights in its October letters served as an exception to the general release-type language contained in Modification R00307.”
Appeals of -- AM General LLC, ASBCA No. 53610, August 21, 2006. Appellant moves for reconsideration of the Board’ earlier decision in AM General LLC, ASBCA Nos. 53610, 54741 discussing the applicability of CAS 418. The government moves to strike an affidavit submitted by Appellant. The affidavit, by a purported expert, states that, in regard to the earlier decision, “the Board’s application of the homogeneity requirements of CAS 418 is not consistent with CAS 418, or with industry’s application of those requirements.” The government argues that Donald H. Rumsfeld, SECRETARY OF DEFENSE v. UNITED TECHNOLOGIES CORPORATION, PRATT & WHITNEY, CAFC No. 02-1071. January 15, 2003 prohibits the consideration of the affidavit as the interpretation of CAS is a matter of law. The Board grants the motion to strike concluding “To allow the Thomas Declaration would require us to ignore the rules under which both parties had litigated the case up to this point, and would require the government to deal with evidence which it had not had to deal with before. This delay in presenting Thomas’ Declaration is unfair and prejudicial to the government. We have considered whether any part of the Thomas Declaration could be received in evidence at this late stage of the proceeding, and have concluded that none of it could be salvaged without prejudicing the government. According, in exercising our discretion, we grant the government’s Motion to Strike.”
Appeal of -- Emerson Construction Company, Inc., ASBCA No. 55165, August 17, 2006. Army requirements contract. The base year of the contract ran until July 31, 1998. Army moves to dismiss a claim mailed on July 30, 2004 and not received by the CO until August 3, 2004 arguing that the claim was submitted after the six year CDA limit. The Board denies the motion finding that “When appellant mailed the claim, it committed it to the contracting officer for decision, and yielded to his authority, meeting the requirements of the Act.” The Board reserves for trial the issue of whether or not appellant should have had reason to believe that the government’s estimate was negligent before the July 31, 1998 date.
Appeal of -- Gray Personnel, Inc., ASBCA No. 54652, August 09, 2005. Walter Reed Army Medical Center fixed price personal services contract. Board holds that it has no jurisdiction to consider claims related to delivery orders issued more than six years prior to filing of the claim.
ARDCO, INC. AGBCA No. 2003-183-1, August 2, 2006. Forest Service(FS) IDIQ contract for aircraft services to drop fire retardants. A FS employee negligently damaged appellant’s airplane taking it out of service for several months. Appellant claims for anticipatory profits for the hours it would have expected to fly, but for the damage by the FS, was denied by the CO on the basis that there was no guarantee that the specified flight hours would be flown. On appeal the FS moves to dismiss the anticipatory profits claim arguing that the existence of the T for C clause excludes such damages and that the only way Appellant can secure anticipatory profits, when a contract contains a T for C clause, is to show that the use of the clause by the FS was exercised in bad faith or was otherwise arbitrary and capricious. The Board, in an opinion by Judge Pollack, with a separate concurring opinion by Judge Vergilio, rejects the FS argument as an overly broad interpretation of the purpose of the T for C clause and providing no basis for not relying on the “common law measure of damages in the event of breach is that a contractor is entitled to be placed in as good a position as it would have, had the breach not been committed. That would include anticipatory profits.” [Interesting case-jaw]
Appeal of -- Spindler Construction Corporation, ASBCA No. 55007, July 31, 2006. Air Force construction contract. Claim by prime on behalf of subcontractor for an increase in the price of steel caused by a “global steel crisis” which sub claims made its performance commercially impracticable. In an opinion by Judge Park-Conroy the Board grants the government’s motion for summary judgment. Although rejecting the government’s Severin doctrine defense, the Board finds that appellant met only the third of the four elements necessary to prove commercial impracticability—“(1) a supervening event made performance impracticable; (2) the non-occurrence of the event was a basic assumption upon which the contract was based; (3) the occurrence of the event was not the contractor’s fault; and (4) the contractor did not assume the risk of occurrence.”
Appeal of -- L-3 Communications Corporation, ASBCA No. 54920, July 27, 2006. Air Force ID/IQ contract. Appellant appeals the denial of its claim for government breach of the Awarding Orders clause of a multiple award indefinite quantity contract. The Board denies the government’s motion to dismiss that argued that the “claim was in substance a protest of the award of a delivery order that is prohibited by statute, regulation and paragraph (c) of the Awarding Orders clause of the contract.” In an opinion by Judge Freeman the Board notes “The same actions of the government in awarding a delivery order under a multiple award indefinite quantity contract may theoretically be grounds for both a ‘protest’ seeking to cancel or modify the award and a ‘claim’ for damages for breach of the Awarding Orders clause of the contract. These are separate and distinct forms of relief with ‘protests‘ governed by FAR Subpart 33.1 and ‘claims’ by FAR Subpart 33.2. The statute, regulation and contract clause prohibit only protests. Link’s certified claim for money damages for breach of the Awarding Orders clause does not seek to cancel or modify the award made. The denial of that claim by the contracting officer is within our jurisdiction under the CDA, FAR Subpart 33.2 and the FAR 52.233-1 DISPUTES (DEC 1998) clause of the contract.”
Appeal of -- P&C Placement Services, Inc., ASBCA No. 54124, July 27, 2006. Air Force contract or nursing services. Appellant claims damages after the government hires a contractor ex-employee arguing that the government breached a trade custom. The Board denies the appeal finding no contract provision or ambiguity of a contract provision which would trigger any trade practice obligation. Regarding any quantum meruit claim the Board notes “To the extent appellant here seeks recovery on the basis of implied contract on a theory of quantum meruit, as recognized in these state court cases cited by appellant, such relief is not available here. The law, in this regard, has been firmly established. Jurisdiction under the Tucker Act, 28 U.S.C. § 1491(a) and the Contract Disputes Act of 1978, 41 U.S.C. § 602(a) extends only to express contracts or implied in fact contracts, entered into by an executive agency, and not to claims on contracts implied in law.”
Appeal of -- International Technology Corporation, ASBCA No. 54136, July 17, 2006. Navy contract. Appellant seeks reimbursement for costs on behalf of itself and a subcontractor over and above the contractual cost ceiling of its cost-reimbursement contract. The contract contained the FAR 52.232-20, LIMITATION OF COST clause. The ASBCA denies the appeal finding “that appellant inexcusably failed to comply with the LOC clause and related DO notice requirements, and that the CO did not abuse her discretion in failing to authorize an increase in the contract cost ceiling for the costs in issue.” The Board also rejects the argument of appellant that “contends that since it was responsible to review [the subcontractor’s] REA, it could not file a timely notice under the LOC clause until its review of the REA was completed and it was convinced that the claimed costs were allowable and payable.“ The Board states “However, the LOC clause does not limit a contractor’s notice obligations to those costs proven to be allowable to a certitude. Rather, the notice is required when the contractor ‘has reason to believe’ of expected cost increases ”
Appeal of -- -National Joint Venture, ASBCA No. 54992, July 17, 2006. Navy demolition contract under Section 8(a) Mentor-Protégé Program to perform a demolition contract. As stated by the Board-“At issue is whether the Navy changed the contract after award by specifying that the percentage of the cost of the contract to be self-performed by the Joint Venture should be at least 25 percent.” The Board denies the appeal concluding “Notwithstanding the Navy’s mistakes, we conclude that exercise of due care on the part of National should have discovered that FAR 52.219-14(b)(4) (at least 25 percent self-performance) rather than FAR 52.219-14(b)(3) (at least 15 percent self-performance) should apply to the procurement.”
Appeal of -- All-State Construction, Inc., ASBCA No. 50586, July 12, 2006. Navy contract on remand from the Federal Circuit. The Board denies the appeal and upholds the default termination finding “no basis for excusing its five week default on its Disputes clause obligation...” The Board discusses appellant’s motion to exclude certain evidence under Federal Rules of Evidence, Rule 408, as statements made during settlement negotiations. The denies the motion, for most part, finding that the alleged meetings were not part of settlement negotiations, but were instead contract administration meetings. The Board also noted that certain statements were not hearsay “because the statements were admissions by an officer of All-State on a matter within the scope of his employment and made while he was so employed.”
Appeal of -- SPACEHAB, Inc. ASBCA No. 54880, July 1. 2006. NASA contract, claim for loss of property aboard Space Shuttle Columbia. The Board denies NASA’s motion for summary judgment on SPACEHAB’s claims based on “mutual mistake, the FAR Part 31 provisions on the allowability of insurance costs, and NASA’s alleged liability as a bailee.” The Board finds that there are disputed questions of fact on all issues, including the argument of NASA that the Anti-Deficiency Act would be violated if the limitation in the contract’s indemnification clause were removed.
MOUNTAIN VALLEY LUMBER, INC., AGBCA No. 2003-171-1, July 18, 2006. RULING ON MOTION FOR SANCTIONS. A very interesting ruling discussing the continuing discovery battle in the underlying Forest Service case. Judge Pollack recounts the positions of DOJ in its refusal to produce documents which are in possession of the DOJ. DOJ has taken the position that the government is not a “person” under Section 11 of the CDA (41 U.S.C. 610), and therefore is not subject to the subpoena (or possible contempt provisions) of the CDA. Judge Pollack disagrees pointing out that the position of DOJ is contrary to the intent of the CDA to provide for a fair resolution of contract disputes. Judge Pollack also takes issue with the position of DOJ that Touhy v. Ragen, 340 U.S. 462 (1951), gives DOJ the authority to withhold documents and not provide a privilege log. Judge Pollack also rejects the arguments of the Forest Service that it should not be subject to sanctions for refusal by DOJ to provide documents, noting that it is up to the Executive to resolve any disagreements between agencies. Judge Pollack therefore rules “The subpoena issued to DOJ in this case is valid and enforceable under the CDA. The FS now has 14 days in which to either produce the documents or a privilege log. If it does not, then the Board panel will enter these sanctions. The Board will draw the adverse inferences that the evidence would show that the FS knew or should have known at the time of award that the FS actions during the environmental process ... would likely not be sustained by the court and that the award was being made in the face of a likely suspension of the contract.”
NORTHROP GRUMMAN COMPUTING SYSTEMS, INC., v. GENERAL SERVICES ADMINISTRATION, GSBCA No. 16367, June 26, 2006. Board denies the government’s motion for summary judgment on a claim by appellant for breach arising from the failure to exercise an option to renew an equipment lease. Interesting case discussing consideration and allegations that government did not use its best efforts to obtain funds. The Board asks for further briefing and presentation of evidence on its questions “regarding the application of the concept of consideration to the August 2001 delivery order modification because that modification was unilaterally issued by a Government contracting officer.”
Appeals of Technocratica, ASBCA Nos. 47992, 47993, 48054, 48060, 48061, June 13, 2006. Navy construction contracts in Greece. The ASBCA overturns the termination for default and assessment of liquidated damages in two contracts. Judge Hartman finds that although the Navy had advised appellant that it was failing to make progress, the delay of more than eleven months after the contract completion date before termination constituted a waiver of the completion date where the government had not stated liquidated damages were accruing or would be assessed or stated that the Navy continued to deem the contractually specified completion date to be in effect.
APPEALS OF MARSHALL ASSOCIATED CONTRACTORS, INC. AND COLUMBIA EXCAVATING, INC. (J.V.), IBCA No. 4397F-2002, June 1, 2006. EAJA case, Bureau of Reclamation contract awarded in 1982, the appeal first filed in 1984. The Board allows attorney fees and expenses of $962,000, but disallows some $920,000 which were “lobbying” costs, rather than costs litigating the matter.
Appeal of -- JWK Korea Ltd., ASBCA No. 54198, May 22, 2006. Army contract for services in the Republic of Korea. Appellant “seeks to recover increased labor costs it incurred incident to the unionization of its work force after the award of the subject contract.” An interesting case involving Korean labor law. The Board denies the claim holding that the contractor assumed the risk of increased labor costs, the government did not withhold superior knowledge and that the contractor’s interpretation of a provision in its proposal was unreasonable.
Appeal of -- Kato Corporation, ASBCA No. 51462, May 18, 2006. Navy construction contract. Appellant seeks remission of liquidated damages, extended overhead costs and an equitable adjustment. The Board rejected the argument of appellant that the Board should enforce an oral settlement agreement, finding instead that there was no agreement as the CO had prepared a formal contract modification which appellant did not accept. The Board denies all of the claims finding that appellant had not met its burden of proof. As an example with the Eichleay claim the Board stated “In sum, Kato has not made any of the showings necessary to establish a prima facie case of entitlement to recovery under the Eichleay formula. It has not established: there was a government-caused delay to its planned contract performance ‘not concurrent with a delay caused by the contractor or for some other reason;’ its contract performance time was thus extended or, alternately, it completed performance on time or early but incurred additional, unabsorbed overhead cost because had it planned to finish even earlier; or it was required to remain on ‘standby’ during the alleged delay.”
Appeals of -- United Technologies Corporation, Pratt & Whitney, ASBCA Nos. 47416, 50453, 54512, May 12, 2006. On remand from the CAFC in Donald H. Rumsfeld, SECRETARY OF DEFENSE v. UNITED TECHNOLOGIES CORPORATION, PRATT & WHITNEY. As stated by the Federal Circuit “facts underlying this case are complex” involving CAS Standard 410, 418 and 420. In a lengthy decision by Judge Park-Conroy, the Board denies appellant’s affirmative defenses of estoppel and related equitable defenses. The Board finds that appellant did not prove that the government knew the import of its disclosures nor that appellant had relied to its detriment on the government’s approval of appellant’s disclosure statements. While agreeing with appellant that the CAFC “comments about the elements required to establish equitable estoppel, and in particular the application of the affirmative misconduct standard, were not necessary to its decision regarding CAS compliance and could be characterized as dictum.”, the Board notes that affirmative misconduct by the government is required by CAFC decisions and that appellant has not shown such misconduct here.
Appeals of --- Weststar Revivor, Inc., ASBCA Nos. 52837, 53171, May 10, 2006. Navy contract for repaving at the Marine Corps Air Station in Yuma, AZ. The Board denies the claims finding that there were patent ambiguities in the specifications which required appellant to inquire before bidding. Although the Board did not condone the government’s actions in causing inconsistencies and confusion with the drawings, the Board concludes “ that this action did not constitute bad faith with an intent to injure appellant so as to provide appellant a cause of action on this basis” citing Am-Pro Protective Agency.
HALLWOOD PLAZA, INC. v. GSA, GSBCA No. 16808, May 16, 2006. On October 14, 2005, appellant received the CO's decision denying appellant’s claim. On December 29, 2005, appellant mailed a notice of appeal to the CO in Chicago,Illinois. On January 24, 2006, GSA informed appellant’s counsel that the the appeal needed to be filed with the GSBCA in Washington, DC. The Board received the appeal on January 24, 2006. The Board grants the government’s motion to dismiss for lack of jurisdiction because the appeal was untimely. The Board notes that it changed its rules in 1993 and that change deleted the rule which allowed a notice of appeal to be filed with the CO. The Board rejects the arguments of appellant which cite cases from other boards which may stand for the proposition that an appeal is timely if received by the CO within the 90 day period of the CDA. After discussing the recognition of the Federal Circuit that gives deference to the GSA rules, the Board concludes-“Because the Board’s rules specifically require that such a notice be filed with the Clerk of the Board, appellant’s argument that sending a notice of appeal to the contracting officer constitutes a ‘filing’ at the Board is just plain wrong. Accordingly, Hallwood’s notice of appeal, which was received by the Clerk 102 days after Hallwood’s receipt of the underlying contracting officer decision, was not filed within the CDA’s ninety-day period for appealing a contracting officer’s decision to this Board, and the Board lacks jurisdiction to consider it.”
EAST COAST SECURITY SERVICES, INC. APPELLANT, v. DEPARTMENT OF HOMELAND SECURITY, FEDERAL PROTECTIVE SERVICE, DOTCAB No. 4469R, May 16, 2006. Appellant asked the Board to enforce the terms of a settlement agreement which included the provision that the government would pay funds to the account of appellant’s attorney. After the motion was filed, the government paid funds directly to appellant, rather than the attorney, and the IRS seized a portion of the payment to offset an outstanding debt. The Board denies the appeal holding that the transmittal to appellant was not a material breach of the settlement agreement and that the IRS could properly offset the payment even if it had been made to the account of the attorney.
Appeal of -- The Boeing Company, ASBCA No. 54853, April 12, 2006. Air Force contracts. Appeal of a sponsored claim seeking indemnification for the costs of investigation and remediation of groundwater pollution, and for the costs of toxic tort litigation. Contracts related to a missile program and included subcontracts to the predecessor of Lockheed to develop and produce the missile’s propulsion system. The contracts and subcontracts contained indemnification clauses against “unusually hazardous” risks, citing Public Law 85-804. The government argues that Board has no jurisdiction on sovereign immunity grounds over 85-804 claims and also argues that the “open-ended indemnification clauses” in the contracts would otherwise violate the Anti-Deficiency Act.” The Board denies the government’s motion holding that it does have jurisdiction under the CDA and that the arguments of the government may be affirmative defenses, but do not run to the jurisdiction of the Board. Good discussion of 85-804 as applied to indemnification clauses.
Appeal of -- Applied Companies, Inc., ASBCA No. 54506, April 12, 2006. On remand from the CAFC decision in Donald H. Rumsfeld, SECRETARY OF DEFENSE v. APPLIED COMPANIES, INC. Damages decision resulting from a negligent government estimate of the quantities for a requirements contract and the government’s subsequent termination for convenience. Appellant’s claim for damages consisted primarily of unabsorbed overhead. The Board denies the appeal. The CAFC had affirmed the earlier Board decision but noted that “negligence in preparing estimates of its requirements did not entitle appellant to recover anticipatory profits. It further instructed the Board that, ‘[i]f, as appears to be the case, no cylinders were delivered, Applied is limited to recourse under the Termination for Convenience of the Government Clause of the contract.” The Board rejects all of appellant’s arguments and concludes by stating “Appellant has challenged only the denial of unabsorbed overhead in appealing the contracting officer’s unilateral determination under that clause. As we have stated elsewhere herein, unabsorbed overhead may be recovered only under the Eichleay formula, and a strict prerequisite for application of the Eichleay formula is government caused delay. As a government-caused delay is not even contended by appellant, its claim for unabsorbed overhead must fail.
Appeals of -- Dual, Inc., ASBCA Nos. 53827, 53889, March 29, 2006. The Board grants the government’s motion to dismiss agreeing with “the government’s position that appellant, a Maryland corporation, was defunct at all relevant times, having forfeited its corporate charter, and that the corporation’s president and CEO could not act for the defunct corporation. The government contends that contractual and statutory time limits passed without valid action by appellant. Therefore, appellant lost the right to submit to the CO a TFC claim and forfeited the right to appeal to the Board from the CO’s unilateral determination.”
Appeal of -- Orion Technology, Inc., ASBCA No. 54608, March 28, 2006. Air Force contract for commercial services using simplified acquisition procedures authorized by FAR 13.5. After award, appellant claims a clerical mistake in its bid entitles it to a correction of the mistake. “The government maintains that the bid verification requirements of FAR 14.407-1 do not apply to this procurement because the contract was awarded under FAR subpart 13.5 which only imposed an obligation on the contracting officer to be reasonable and the mistake was disclosed after award.” The Board sustains the appeal holding that “While FAR 13.106-2(b)(1) gives the contracting officer flexibility as to evaluation procedures, it does not affect the principles applicable to remedies for mistakes disclosed after award.”
ENVIROSOLVE, LLC, v. U.S. DEPARTMENT OF JUSTICE DRUG ENFORCEMENT ADMINISTRATION, DOTCAB No. 4463, March 20, 2006. Time and materials contract for hazardous waste removal services. Appellant allegedly refused to provide services when requested and government went to another source and claims excess reprocurement costs from appellant and argues that appellant’s failure to perform was a constructive termination. The Board acknowledges appellant’s argument that the termination clause in the contract did not provide for excess reprocurement costs. The holds that the CDA recognizes common law breach claims and concludes that-“...that the government is not precluded from seeking damages in the event that the facts, once developed, show that Envirosolve breached the contract.”
APPEAL OF -- SIMPLIX, ASBCA No. 52570, March 14, 2006. Appeal of a Value Added Network (VAN) License Agreement (VLA) between the DoD and appellant. No payments were to be made to appellant by the government, appellant was to receive payment from users of appellant’s VAN. The CO had denied a claim for $8,703,872,251.37 [That is 8+ billion!] including a profit margin of 57,900 percent, which has been reduced to $204,000,000 following an earlier revised claim of $6 Billion. Appellant alleges that DoD breached the VLA through a variety of actions or inactions. The Board found that “Simplix was unable to produce sufficient supporting information to provide credibility to its claim or [its expert’s] report.“ Although agreeing that the government breached the agreement, the Board denies the lost profits claim, following another VAN case CACI International, Inc., ASBCA Nos. 53058, 54110, 05-1 BCA ¶ 32,948, where the Board held that:“1) the profits allegedly lost were not the proximate result of the breach; 2) the profits allegedly lost were not foreseeable by the parties; 3) the profits allegedly lost were not reasonably certain; 4) the damage estimates were not consistent with the facts of the case; and, 5) the profits allegedly lost were too remote and consequential because they would have been realized, if at all, through collateral enterprises.” The Board also commented adversely on the creditability of the expert offered by appellant.
APPEAL OF -- IMS ENGINEERS - ARCHITECTS, P.C., ASBCA No. 53471, March 09, 2006. COE IDIQ contract with 8(a) firm. Appellant seeks damages for breach of contract, alleging that the government terminated a delivery order and failed to exercise the last two option years of the subject indefinite delivery (IDIQ) contract in bad faith because of racial and ethnic discrimination. The Board denies the appeal finding the appellant does not overcome the presumption of good faith by government officials. The Board relies on Kelvar, “well-nigh irrefragable proof”, and Am-Pro Protective Agency, Inc. v. United States. The Board notes that “in order to meet its burden of proof, appellant must create in us ‘an abiding conviction’ that the district’s actions were motivated by racial or ethnic bias or a specific intent to harm or get rid of appellant because it was an 8(a) contractor.”
MONSTER GOVERNMENT SOLUTIONS, INC. vc, UNITED STATES DEPARTMENT OF HOMELAND SECURITY, U.S. CUSTOMS AND BORDER, DOTCAB No. 4532, March 08, 2006. The government terminated a task order under a FSS contract for default. Although appellant argued that its performance was excusable because there had been a “tremendous increase” in customer usage, the CO did not refer the matter to the GSA as was required by the contract. The Board dismisses the appeal finding that the “failure to refer the dispute to the GSA schedule contracting officer renders [the government’s] termination and excess reprocurement decisions nullities. Therefore, we lack jurisdiction of the appeals from them.”
Appeal of RONALD L. JOHNSON, PSBCA No. 5282, March 08, 2006. Appellant had an ordering agreement with the Postal service for investigative services. After being informed that the agreement would not be renewed, appellant appealed to the Board. The Board dismisses the appeal for lack of jurisdiction noting that the ordering agreement is not a contract. Appellant’s amended complaint for breach of an order was also dismissed as the claim had not been submitted to the CO.
BANNUM, INC., DOTCAB No. 4452, March 2006. Bureau of Prisons ID/IQ contract. The Board rejects the argument that appellant is entitled to “one hundred percent of its inmate rate/unit price multiplied by the number of unordered minimum guaranteed inmate days...” The Board follows DELTA CONSTRUCTION INTERNATIONAL, INC. where the Federal Circuit held that where government breaches an IDIQ contract by not ordering the minimum, proper measure of damages is the loss the contractor suffered by the breach, not the difference between the minimum amount and the amount actually ordered.
APPEAL OF -- PARKER EXCAVATING, INC., ASBCA No. 54637, February 28, 2006. Army 8(a) requirements contract for burying of electrical cables at Fort Carson. The ASBCA sustains an appeal based on differing site conditions. Finding that “daily QCRs put the government on notice of the conditions encountered, and the contracting officer had written notice of the conditions as of 12 December 2002 [citations omitted]. In addition, we have found that the government was aware of the conditions from meetings and site visits [citations omitted]. The burden is on the government to establish that it was prejudiced by absence of the required notice. Grumman Aerospace Corporation, supra. Here the government has made no showing of prejudice from the passage of time or an inability to minimize extra costs resulting from any delay in receiving prompt written notice.”
APPEAL OF -- GRUMMAN AEROSPACE CORPORATION, ASBCA No, 48006, February 27, 2006. Air Force contract. Quantum decision in this much litigated contract for F-111 avionics modernization. [See for example, ASBCA 46834 and ASBCA 51526.] The Board sustains the appeal, in part, but rejects much of the claim. The Board rejects appellant’s use of the “modified total cost method” finding that appellant has failed to prove “... (2) the reasonableness of its bid; (3) the reasonableness of its actual costs; and (4) lack of responsibility for the added costs.” The Board also rejects appellant’s alternate jury verdict argument finding that there was not “sufficient evidence to allow the Board to make a fair and reasonable approximation of damages.”
L.P. FLEMING, JR. INC., PSBCA No. 5197, February 03, 2006. Appellant’s bid regarding driving times was in conformance with the solicitation even though published regulations were different. The government subsequently required appellant to comply with new regulations and denied the claim for an increase in contract price. The PSBCA sustains the appeal finding that “Appellant’s interpretation of the contract requirements was reasonable and was shared by Respondent at the time of award and thereafter. Under these circumstances, that interpretation of the contract language governs. [citations omitted] Therefore, when the contracting officer directed Appellant to perform the contract in accordance with the revised DOT regulations, that direction had the effect of changing the contract provisions governing both the allowable driving time and the required off-duty time.” [See article by list member David Hendel discussing this case.]
Appeals of AM GENERAL LLC, ASBCA Nos. 53610, 547541, February 02, 2006. Army contracts for HMMWVs [High Mobility Multipurpose Wheeled Vehicles]. The ASBCA grants the government’s motion for summary judgment on entitlement issues arising from change by appellant in the allocation of costs between the production of the contract items and its commercial version, the HUMMER®. The Board rejects the argument by appellant that requirements of CAS 418 did not apply or that CAS requirements had been waived by the government. Good discussion of the applicability of CAS standards, the CASB and related waiver issues.
APPEAL OF NATIONAL PRINTING AND COPYING, VABCA No. 7211GPO, January 30, 2006. GPO contract. The VABCA upholds the termination for default and assessment of excess reprocurement costs. Judge Sheridan notes that the failure of a part in a subcontractor’s facility is not a reason for the prime to be excused from the failure to make a timely delivery.
Appeals of DynCorp, ASBCA Nos. 49714, 53098, January 26, 2006. Army contract, Major Fraud Act of 1988 case. On remand from Federal Circuit, the Board finds that only $43,922.85 of appellant’s legal costs are recoverable as contrasted with the amount of $585,650 awarded in the prior ASBCA decision. The Board holds that, for the most part, that the costs at issue arose from a single proceeding and involved the same contractor misconduct-falsified records. Judge Eunice Thomas, joined by Judge Rome, dissents in part and would sustain the appeal in the amount of $448,661.96.
Appeal of A-Greater New Jersey Movers, Inc., ASBCA No. 54575, January 24, 2006. Army requirements contract for moving services at Fort Dix. The Board upholds a termination for default finding that a cure notice was not required as the contractor repudiated the contract. The Board also noted that appellant had not shown that the government was at fault for late payments to appellant and that “The Board does not accord special treatment in determining whether the burden of proof has been met to a contractor because of its status as a small business.”
APPEAL OF -- ITT FEDERAL SERVICES INTERNATIONAL CORPORATION, ASBCA No. 54001, December 29, 2005. Cost-plus-fixed-fee Army contract for operation and maintenance of communication facilities in Europe. Appellant claims an increase in fee because of a change in the mix of employees between “Technical Expert(s)” (TE) and “Local Nationals” (LN) employees. LN employees were subject to German tax and social laws. The government argued that because the work had not changed appellant was not entitled to an increase in fee. The Board disagreed finding that the contract had been changed recognizing the change in employee mix and concludes by stating “The additional fee is not a consequence of the increase in costs, it flows from the change to the contract and the revised risks associated with the change. The manner of performing the work was a risk appellant expressly excluded in its fee proposal.”
APPEAL OF -- RYSTE & RICAS, INC., ASBCA No. 54514, November 10, 2005. Previous decision converting a termination for default to a termination for convenience was received by appellant’s former counsel on June 8, 2002. Appellant neither submitted a termination settlement proposal, nor requested a time extension, by June 9, 2003. Appellant submitted a settlement proposal, with claim certification, on or after July 23, 2003. The CO never responded and this appeal was filed. The Board dismisses the appeal, rejecting the argument that “‘the effective date of the termination for convenience was September 29, 2002,’ the date upon which the appeal period is said to have expired.” The Board notes “We see no reason to engraft the requirements of these [EAJA] statutory schemes onto the straightforward procedure for submission of termination for convenience settlement proposals.”
TURNER CONSTRUCTION COMPANY v. GENERAL SERVICES ADMINIUSTRATION, GSBCA Nos. 15502, 16055, 16551, October 24, 2005. GSA construction contract. After discovery and well into trial, the government moves to amend its answer to assert affirmative defenses involving allegations of fraud including violations of the Sherman Act and the Anti-Kickback Act. The Board denies the motion holding that it does not have jurisdiction under the CDA of the fraudulent actions alleged. The Board also finds that the government had knowledge of the suspected fraud for several months and allowing the leave to amend would unduly prejudice appellant. The Board does note however, “Respondent may amend its answer to plead breach of contract, not based on fraud or alleged Sherman Act violations, but based upon clauses within the contract in dispute.” Finally, the Board also denies the request by the government for a six months suspension of the proceedings to pursue the fraud allegations concluding that the Board is not convinced that continuing the trial will harm any pending criminal proceedings.
PARCEL 49C LIMITED PARTNERSHIP v. GENERAL SERVICES ADMINISTRATION, GSBCA No. 16377, October 18, 2005. Appellant appeals a decision by the contracting office allowing a 10 per cent lessor profit markup on subcontractor costs for extra work added to the contract. Appellant claims it is entitled to a 24 percent markup, which were the elements of markup on the build out of the basic contract. After noting that the markup is business matter rather than legal matter the board stated that it is “..forced to resolve through legal analysis what the parties should have resolved as a business matter.” The Board rejects the argument of appellant that once it has shown its direct costs it becomes the burden of the government to show that the markup was unreasonable. Noting that appellant had not responded to the CO’s request for information justifying the markup the Board denies the claim. The Board concludes by stating it “ is impossible for a contracting officer or a board of contract appeals to assign any particular percentage markup to these costs. Although we are confident that Parcel 49C did incur some overhead costs, we cannot even attempt to estimate their value where no basis for it, other than ‘everyb