# DISMISSED FOR LACK OF JURISDICTION: September 27, 2007

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## Record

- **Collection:** Agency decision
- **Document type:** Agency decision

## Text

DISMISSED FOR LACK OF JURISDICTION: September 27, 2007

CBCA 12, 33, 365, 366, 367

INNOVATIVE (PBX) TELEPHONE SERVICES, INC.,
Appellant,
v.
DEPARTMENT OF VETERANS AFFAIRS,
Respondent.
David W. Young, Vice President of Innovative (PBX) Telephone Services, Inc., El
Paso, TX, representing Appellant.
Brian Reed, Dennis Foley, and Phillipa Anderson, Office of the General Counsel,
Department of Veterans Affairs, Washington, DC, counsel for Respondent.
Before Board Judges BORWICK, FENNESSY, and SHERIDAN.
SHERIDAN, Board Judge.
These appeals arise out of disputes between the appellant, Innovative (PBX)
Telephone Services, Inc. (IPS), and the respondent, Department of Veterans Affairs (VA),
at the VA Health Care Center (VAHCC) in El Paso, Texas. IPS has filed an appeal on a $6
million claim which cites a “breach of contract including tort and bad faith on the part of the
Government employees at the VAHCC in El Paso, Texas, for events surrounding contract
V101(93)P-1458 and the Las Cruces[, New Mexico, VA] Clinic.”
The respondent filed a motion to dismiss the appeals, arguing that the Board lacks
jurisdiction to entertain the appellant’s complaint, the appellant has not stated a claim upon
which relief can be granted, and the appellant has failed to prosecute its claim in accordance

CBCA 12, 33, 365, 366, 367

2

with Board rules and orders. The respondent attaches to its motion several documents. The
appellant opposes the respondent’s motion and has submitted a motion for sanctions against
the respondent. The appellant also attaches several documents to its opposition and motion.
The respondent has responded to the appellant’s motion, and the appellant has replied to the
respondent’s response. The documents that have been submitted with these motions are
incomplete, but they provide a sufficient foundation upon which to base our decision. For
purposes of deciding the respondent’s motion, we have accepted as true all well-pled facts
alleged by the appellant.
In considering the respondent’s motion to dismiss for lack of jurisdiction, the burden
of establishing jurisdiction is on the appellant. Houston Ship Repair, Inc. v. Department of
Transportation, DOTCAB 4505, 06-2 BCA ¶ 33,381 (citing McNutt v. General Motors
Acceptance Corp. of Indiana, 298 U.S. 178, 189 (1936); Rocovich v. United States, 933 F.2d
991, 993 (Fed. Cir. 1991); Reynolds v. Army & Air Force Exchange Service, 846 F.2d 746,
748 (Fed. Cir. 1988)). In order to assist us in evaluating the merits of the respondent’s
motion to dismiss, we look for guidance to the standards used for the Federal Rules of Civil
Procedure. Board Rule 1(c) (72 Fed. Reg. 36,794, 36,796 (July 5, 2007). Under Federal
Rule of Civil Procedure 12(b)(1), the allegations of the complaint must be construed in favor
of the pleader. If, based on well-pled facts, the appellant might prevail, we must deny the
motion. Key Federal Finance v. General Services Administration, CBCA 411, et al., 07-1
BCA ¶ 33,555 (citing Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)); W. R. Cooper General
Contractor, Inc. v. United States, 843 F.2d 1362, 1364 (Fed. Cir. 1988); Reynolds, 846 F.2d
at 747). If, however, the respondent challenges the truth of the jurisdictional facts alleged
in the complaint, the Board may expand its consideration of evidence beyond the pleadings.
See, e.g., Detroit Housing Corp. v. United States, 55 Fed. Cl. 410, 412 (2003). “The
[tribunal] should look beyond the pleadings and decide for itself those facts, even in dispute,
which are necessary for a determination of [the] jurisdictional merits.” Id. (citing Pride v.
United States, 40 Fed. Cl. 730, 732 (1998)); see also Cedars-Sinai Medical Center v.
Watkins, 11 F.3d 1573, 1584 (Fed. Cir. 1993) (when jurisdiction is at issue, the tribunal is
not limited to the pleadings). We have looked to the documents submitted with the motions
to evaluate the jurisdictional issues presented by these appeals.
Statement of Facts
The El Paso VA Health Care System (VAHCS) currently includes the main campus
VAHCC in El Paso, Texas, and an outpatient clinic in Las Cruces, New Mexico (Las Cruces
VA Clinic). In 1994, the VA wanted to replace the telephone system at the El Paso VAHCC,
and on November 14, 1994, the VA Acquisition Operations Service approached the Small
Business Administration (SBA) to obtain a qualified 8(a) firm capable of performing the

CBCA 12, 33, 365, 366, 367

3

work.1 IPS was the subcontractor proffered by the SBA, and on March 24, 1995, the VA
awarded contract V101(93)P-1458 (hereinafter referred to as the telephone system contract).
Under the terms of the telephone system contract, IPS agreed to replace the old telephone
system at the El Paso VAHCC with a new Mitel telephone system. The work included
furnishing and installing the telephone system in accordance with the contract specifications.
The contract contained various schedules, each setting forth a list of products and services
that were available under the contract using contract line item numbers (CLINs). Through
these schedules the VAHCC was able to purchase, by CLIN, the telephone system products
and services it needed. Each CLIN had an associated price. IPS also was required to provide
maintenance on the new telephone system for one base year and as many as nine additional
years. The additional years of maintenance were to be provided at the option of the VA.
The telephone system contract was awarded and the installation portion of the contract
administered by the VA Acquisition Operations Service in Washington, D.C. After
installation of the system, the administration of the maintenance portion of the contract was
delegated to the El Paso VAHCC. On September 26, 2000, Mr. Daniel Portillo, the
contracting officer assigned to administer the maintenance portion of the telephone system
contract, designated Mr. Jack Jordan, the chief of the Facility Support Service at the El Paso
VAHCC, as the contracting officer’s technical representative (COTR). In his position as
chief, Mr. Jordan was involved in the planning, decisions, procurement, and administration
of the many contract-related actions throughout the VAHCC, including contracts for
construction, installation, repair, and maintenance of various facility systems.
While IPS was providing maintenance services on the telephone system, the VAHCC
issued other contractual instruments to IPS to provide additional products and services. For
example, on September 26, 2002, Mr. Portillo issued purchase order 756-C20035 for supplies
and services related to a television recabling project in the main building at the El Paso
VAHCC (hereinafter referred to as the television recabling purchase order). The television
recabling purchase order required that IPS “adhere to standard VA specifications and the
specifications listed in the construction documents already provided to the contractor.” The
document is not clear as to what construction documents had been supplied to IPS, but the
purchase order used the CLIN items and pricing contained in the telephone system contract.
Therefore, we assume the construction documents were those relating to the telephone
system contract. We note that Mr. Jordan appeared on some of the documentation related
to this project as the “approving official.”

1

IPS was designated as a subcontractor in the program authorized by section 8(a) of
the Small Business Act. 15 U.S.C. § 637(a) (1994).

CBCA 12, 33, 365, 366, 367

4

On May 14, 2003, an incident occurred involving Mr. David Young, IPS’ vicepresident, and Mr. Jordan. Mr. Jordan called IPS’ corporate offices conveying a complaint
that had been made about the cable televisions not working at the El Paso VAHCC. He
spoke to Mr. Young. Mr. Young recounts, in a May 15, 2003, letter titled “Official
Complaint,” to Mr. Byron Jaqua, the director of the El Paso VAHCC:
On Wednesday, May 14, 2003 . . . Mr. Jordan called IPS’ corporate office
regarding the [cable televisions] within the VA[HCC]. He stated that all the
[televisions] were down. To our surprise, all the sites he mentioned, 4th floor
neurology, cardiology, and the 1st floor conference rooms[,] were all operating
properly when IPS’ technician left the VA[HCC] on Friday afternoon from
adding the local channels. . . . This was explained to Mr. Jordan but it was not
the answer he wanted to hear. Mr. Young told him th[at IPS] would look into
it to find out why the [televisions] were not operating. It was then explained
to Mr. Jordan that Mr. Young was in a meeting discussing a facsimile that was
just received in [IPS’] office that morning from Mr. Daniel Portillo regarding
a couple of outstanding work orders at the VA. It was also explained to Mr.
Jordan that there was a due date for a response to the facsimile.
At hearing this, Mr. Jordan became irate and would not listen to reason. Mr.
Young told Mr. Jordan that he needed to calm down so they could discuss the
matter professionally; this only made Mr. Jordan more upset and he became
belligerent. When Mr. Jordan began screaming, Mr. Young pushed the
speaker button on the telephone so that all parties in the conference room
could witness what was being said. It was then, Mr. Jordan, in our opinion,
completely lost control of his demeanor and began screaming and swearing at
the top of his voice. A banging sound was heard in the background, as if Mr.
Jordan was hitting a wall or desk to punctuate his sentences. Mr. Jordan
demanded that Mr. Young “get his ‘black ass’ over to the VA and fix the
televisions or he [Mr. Jordan] was going to use all his power to make sure IPS’
contract with the VA would be cancelled and he would also ensure that IPS
would never receive another VA contract in this country again.”
For purposes of deciding this motion, we accept IPS’ version of these events as true.
Mr. Jaqua responded to the complaint letter on June 16, 2003, with a letter to Mr.
Young stating that he had reviewed the letter and witnesses’ statements. He had met with
Mr. Jordan to discuss the matter to determine what appropriate facility action needed to be
taken “to make sure that our contract with your office is maintained according to contracting
regulations and procedures.” Mr. Jaqua wrote, “[r]acial comments or use of curse words will

CBCA 12, 33, 365, 366, 367

5

not be tolerated and respect for others is expected.” While he did not indicate whether he
agreed that the event complained of had occurred, he did write, “I can assure you that this
incident is being resolved so that we can continue to work together under current contract
requirements.” He also informed IPS that he had asked Mr. Portillo to meet with IPS to
resolve issues regarding services, billings, and payments, also raised in the complaint letter.
Following the May 14, 2003, incident, the VAHCC continued to exercise the options
for annual maintenance that were available under the telephone system contract. Other
contractual instruments were used to procure additional supplies and services from IPS.
Pricing for the additional supplies and services was based on the CLINs and the pricing
contained in the telephone system contract. Mr. Louis Barba, Jr., an engineer in the
VAHCC’s Facility Support Service, was designated the COTR on IPS’ contract “for the
maintenance of the phone system” on December 4, 2003.
Mr. Young wrote to Mr. Jaqua again on November 20, 2003, attempting to distance
IPS from Mr. Jordan, whom he alleged was still being “unprofessional toward [IPS]
technicians and purposely delayed payments due our company.” Mr. Don Martin in the
VAHCC’s Facility Support Service replaced Mr. Barba as COTR on January 28, 2004. The
final option year of maintenance on the telephone system contract was set to expire on March
23, 2005; however, the VAHCC extended the contract to run through September 30, 2005.
According to the VA, this six-month period was the maximum amount of time that it was
allowed to extend the telephone system contract pursuant to Federal Acquisition Regulation
(FAR) 52-217-9, Option to Extend Services.
On September 6, 2005, Mr. Young wrote Mr. Michael Bell, who was appointed the
acting director at the VAHCC after Mr. Jaqua left. Mr. Young complained that “IPS firmly
believes that Mr. Jordan still has ultimate authority over the telecommunications decision
making process at the El Paso VA[HCC],” and that his involvement is hindering IPS from
“fulfilling our contract to the best of our ability.” IPS provided no specificity as to how it
was being hindered by Mr. Jordan. Mr. Bell wrote back to IPS on September 16, 2005:
Effective the week of September 19, 2005, the responsibility for [COTR] and
operational management will be the El Paso [VAHCC’s] Information
[Resource] Management Service (IRM). I anticipate that Mr. Juan Garcia will
be appointed COTR.
I have asked my Executive Assistant . . . to coordinate this transfer of
responsibility and to facilitate closing out all open issues from the current
COTR to include matters of payments due.

CBCA 12, 33, 365, 366, 367

6

As the FAR allowed no further extensions of the telephone system contract,
supervisory contract specialist and contracting officer Ms. Catalina (Cathy) Fernandez issued
purchase orders to IPS. Through various contract instruments the VA had IPS obligated to
provide telephone system maintenance services at the VAHCC through September 30, 2006.
The documents in the Board’s possession show that Mr. Jordan initiated, authorized,
approved, and/or was otherwise involved in several job requests, work orders, and payments
through September 2005. These activities all referenced CLINs and pricing in IPS’
telephone system contract. On March 1, 2006, Mr. Juan Garcia, the chief of the VAHCC’s
IRM service, was designated the primary COTR “on the contract with IPS for the
maintenance of the telephone system at the VAHCS.”
In anticipation of the expiration of IPS’ contractual coverage for maintenance of the
telephone system, the El Paso VAHCS began considering what it should do to meet its future
telephone system needs. Ultimately, it decided to keep the Mitel telephone system installed
by IPS. It approached the SBA to obtain a contractor to perform the future telephone system
maintenance work. On July 21, 2006, the SBA offered H Squared Industries, Inc., an 8(a),
service-disabled, woman-owned business, to meet the VAHCC’s telephone system
maintenance needs. The VA informed IPS that its services to maintain the VAHCC’s
telephone system were no longer needed as of July 18, 2006.
In the meantime, on May 2, 2006, IPS had submitted a certified claim, citing a “breach
of contract including tort and bad faith on the part of the Government employees at the
VAHCC in El Paso, Texas for events surrounding contract no. V101(93)P-1458 [the
telephone system contract] and the Las Cruces [VA] Clinic.” The claim also included
allegations of racial discrimination by VAHCC employees. IPS sought $6 million in
“expectancy damages which are equated with lost profits and other elements which will make
IPS whole.” 2

2

IPS also maintains in its brief that it submitted another claim on contract
V101(93)P-1458 and subsequent purchase orders. The VA denies receipt of this claim. The
appellant has been unable to produce an executed copy, and it does not appear that the claim
was resubmitted to the contracting officer. As IPS has not elected to appeal the contacting
officer’s failure to issue a final decision, the allegations contained in the letter are not
properly before us for use in issuing this decision. Willie Clarence Logan v. Department of
State, GSBCA 15691-ST, 02-2 BCA ¶ 31,915.

CBCA 12, 33, 365, 366, 367

7

Ms. Fernandez responded to IPS’ claim on May 12, 2006, stating:
[T]here is no basis for recovery of a tort under the Contract Disputes Act. The
allegations of racial slurs are related to the [television cabling] installation
project which was issued under a separate purchase order and are not related
to the above-referenced contract.
The contract awarded to your company for the installation of the Mitel
telephone system and the follow-up maintenance period expired in March of
2005. However, the facility has continued to issue purchase orders to your
company for the telephone maintenance ever since the expiration of the abovereferenced contract.
....
Your company has not been damaged in any way as your company has
continued to receive purchase orders for the telephone maintenance for the [El
Paso VAHCC] and the Las Cruces [VA Clinic]. The claims in your letter are
not adequately described and are not itemized. Your company is not entitled
to any additional compensation, and therefore, I am denying all these claims.
IPS appealed the final decision to the VA Board of Contract Appeals on July 18, 2006.
The VA Board docketed the appeal as VABCA 7593 (addressing claim items I and II),
VABCA 7594 (addressing claim items III, IV, and V), VABCA 7595 (addressing claim item
VI), VABCA 7596 (addressing claim items VII and VIII), and VABCA 7597 (addressing
claim items IX, X, XI, and XII). The VA Board was, pursuant to statute, consolidated into
the Civilian Board of Contract Appeals on January 6, 2007. Pub. L. No. 109-163, § 847, 119
Stat. 3136 (2006). VABCA 7593 was redocketed as CBCA 12, VABCA 7594 as CBCA 33,
VABCA 7595 as CBCA 365, VABCA 7596 as CBCA 366, and VABCA 7597 as CBCA
367.
We note that regarding the matters before us, the appellant mirrors the same
numbering system (using roman numerals to designate counts I through XII) that it used to
designate claim items. We elect to refer to this same numbering system that interchangeably
refers to both complaint counts and claim items. Set forth below are the respective appeals
with their corresponding claim items and complaint counts.

CBCA 12, 33, 365, 366, 367

8

CBCA 12 -- Complaint, counts I and II (claim items I and II)
In counts I and II of its complaint, IPS seeks $1.2 million in damages from the VA,
alleging:
I. It is our belief that IPS has been a victim of a series of instances of bad
faith, beginning with but not limited to racial prejudice on the part of
Government officials at the VAHCC and the Las Cruces [VA] Clinic.
II. It is our opinion that the contracting officer’s technical representative and
chief of [the VAHCC’s] Facility Support Service (FSS) (which during the time
of most of the incident oversaw the contracting department), Mr. Jack Jordan,
discriminated against IPS because of our company being owned and operated
by Afro Americans.
CBCA 33 – Complaint, counts III, IV, and V (claim items III, IV, and V)
In counts III, IV, and V of its complaint, IPS seeks $1.2 million in damages from the
VA, alleging:
III. It is further our opinion that Mr. Jordan and John Doe conspired against
IPS to injure IPS and to financially force IPS out of business.
IV. It is our firm resolve to provide solid evidence that Mr. Jordan and John
Doe, employees of the VAHCC attempted financial sabotage of IPS.
V. It is our opinion that Mr. Jordan attempted to sabotage IPS’ contract with
the VAHCC and the Las Cruces [VA] Clinic.
CBCA 365 -- Complaint, count VI (claim item VI)
In count VI of its complaint, IPS seeks $1.2 million in damages from the VA,
alleging:
VI. IPS feels that Mr. Jordan violated our Civil Rights by making disparaging
racial comments against one of IPS’ officers. We feel that as a government
official he has flagrantly abused his position, which is an act of bad faith and
breach of contract. See May 15, 2003 complaint letter. When IPS contacted
the Contracting and Administrative [offices at the VAHCC El Paso] regarding
this urgent issue, very little to no action was taken.

CBCA 12, 33, 365, 366, 367

9

CBCA 366 -- Complaint, counts VII and VIII (claim items VII and VIII)
In counts VII and VIII of its complaint, IPS seeks $1.2 million in damages from the
VA, alleging:
VII. It is further our opinion that on numerous occasions Mr. Jordan made
disparaging comments regarding IPS that slowly but effectively ruined IPS’
reputation with the VAHCC, harming IPS’ ability to win new contracts with
this VA facility, this is a prime example of tort.
VIII. IPS has been irreparably harmed by the VAHCC as described by the
following instances:
A. IPS was informed by William Beaumont Army Medical
Center (WBAMC) staff that the VAHCC approached WBAMC
to strongly consider having WBAMC provide the
telecommunication service for the VAHCC. It is IPS’
understanding that this violates [VA] Central Office policy
regarding VA facilities which states that each VA [facility]
should have its own stand-alone telecommunications system
(See R[FP] [request for proposal] 101-11-95 and other similar
R[FP]s). If Mr. Jordan had not destroyed IPS’ reputation at the
VAHCC, this option would never have been a consideration.
B. IPS was informed through the Federal Government
notification service that the VAHCC began requesting bids for
the telephone maintenance service. It is IPS’ opinion that this
decision will be more costly for the VAHCC since they will now
have to train another vendor, who unlike IPS, has not been with
the VAHCC since its inception, and therefore will not perform
maintenance tasks with the same level of proficiency as IPS
which we naturally draw from our vast experience at this site.
This decision is not in the best interest of the veterans of which
we are a veteran owned company. To date, IPS feels that this
situation is a direct result from bad faith on the part of Mr.
Jordan.
C. Comments by Mr. Jordan such as “I’m going to get IPS off
of this contract,” and “I will make sure you (IPS) never get
another contract” have irrevocably harmed IPS and to date IPS

CBCA 12, 33, 365, 366, 367

10

is still suffering as a direct result from these disparaging
comments.
CBCA 367 -- Complaint, counts IX, X, XI, and XII (claim items IX, X, XI, and XII)
In counts IX, X, XI, and XII of its complaint, IPS seeks $1.2 million in damages from
the VA, alleging:
IX. Through discovery, IPS feels that more evidence of bad faith will be
uncovered against IPS and other minority owned contractors. It is our belief
that race is one of the reasons the VAHCC, by means of its employees, has
discriminated against our company.
X. IPS understands that the burden of proof lies on our ability to prove what
has been alleged. IPS understands that in order to overcome this presumption
IPS must allege and prove, by clear and strong evidence, specific acts of bad
faith on the part of the government which we feel there is evidence of specific
intent to injure IPS.
XI. IPS also claims and believes that the VAHCC acted arbitrarily and
capriciously. As a result of the disparaging comments about IPS, IPS has
suffered. It is our opinion that there is significant evidence that the VAHCC
acted in bad faith.
XII. Furthermore, it is our belief that the government official Mr. Jordan and
John Doe at the VAHCC, by their actions, attempted the financial destruction
of IPS by avoiding payments and by derailing future contracts, which
ultimately would financially ruin IPS, another act of bad faith. IPS is hereby
seeking adequate adjustments for consequential damages in regard to events
surrounding Contract Nos. [sic] V101(93)P-1458 and the Las Cruces Clinic.
Discussion
The respondent has moved the Board to dismiss CBCA 12, 33, 365, 366, and 367,
arguing that we lack jurisdiction to consider these appeals. The scope of our jurisdiction is
limited by the appellant’s May 2, 2006, claim; we have the authority to resolve only the
issues raised in the notice of appeal that were also presented to the contracting officer in the
claim. The initial thrust of the respondent’s motion seems to be that the Board lacks
jurisdiction to consider each of the appellant’s claims because the claims only referenced the
telephone system contract (V101(93)P-1458) as opposed to the television recabling purchase

CBCA 12, 33, 365, 366, 367

11

order (756-C20035). It was in regard to the television recabling purchase order work, the
respondent avers, that an alleged bad faith racial comment was made. The respondent asserts
that because the television recabling work was not related to the telephone system contract
in any way, the Board lacks jurisdiction to entertain the appellant’s claim referencing the
telephone system contract. The appellant, however, avers that the pricing for the television
cabling purchase order, and all the work that IPS performed at the El Paso VAHCC, was
based on the CLINs and the pricing contained in the telephone system contract. IPS posits:
“only one contract was performed [by IPS] at the VAHCC, contract V101(93)P-1458 [the
telephone system contract].”
While the contractual instruments that the VAHCC issued to IPS bore various titles ­
work order, job order, job request, purchase order, contract, and contract extension - IPS
contends, and it appears from the documents, that the CLINs and pricing contained in the
telephone system contract served as the basis for all the subsequent instruments the VAHCC
issued to IPS for products and services. As an example, IPS explains that when the VAHCC
sought to procure the television recabling work, it first modified the telephone system
contract to add additional products and services necessary for television cabling. The
television cabling products and services were added to the telephone system contract as
CLINs, with the pricing for each new CLIN agreed upon by the parties. Thus, television
cabling products and services that were not in the telephone system contract as originally
awarded were, by that modification, made available for purchase under the telephone system
contract. It was only after the telephone system contract had been modified that the VAHCC
issued a purchase order to procure the products and services from IPS needed to perform the
television recabling project.
We do not see the respondent’s argument as compelling the dismissal of these appeals.
A more fundamental flaw exists with the appellant’s appeals which we will discuss infra.
While the appellant’s position that only one contract was performed by IPS at the VAHCC
is both a factual and legal conclusion, it is not an argument we are willing to summarily
dismiss. So too, it is not an issue we need to resolve for purposes of deciding the
respondent’s jurisdictional motion. Whether the appellant’s claim was brought under the
telephone system contract or some other contract instrument is immaterial because the
appellant has wholly failed to tie any alleged bad faith action to a provision or performance
of a contract it had with the VAHCC.
Allegations of bad faith on the part of government officials administering the contract
are found in each count of the appellant’s complaint. Arising out of the alleged bad faith
actions are claims sounding in tort, contained in counts III, IV, V, VII, VIII.A, and VIII.C,
where the appellant alleges it has been the victim of conspiracy, sabotage, and attempts by
VAHCC employees to force it out of business. Also flowing from the bad faith acts are the

CBCA 12, 33, 365, 366, 367

12

appellant’s claims of racial discrimination by government officials found primarily in counts
I, II, VI, VII, VIII.B, IX, X, XI, and XII of its claim and complaint. We note at the outset
of this discussion that the appellant’s allegations are vague, generalized, and conclusory, and
can hardly be considered “well-pled,” as IPS fails to provide any factual basis to support
them.
The appellant seems to take the position that the May 14, 2003, incident involving Mr.
Jordan is specific proof of bad faith, racially discriminatory actions on the part of Mr. Jordan
and other VAHCC employees, bent on adversely impacting IPS’ future contracting
opportunities. During that incident, Mr. Jordan screamed a racially insensitive phrase at Mr.
Young and told him fix the televisions or “he [Mr. Jordan] was going to use all his power to
make sure IPS’ contract with the VA would be cancelled and . . . that IPS would never
receive another VA contract in this country again.” In addition to the May 14, 2003,
incident, the appellant alludes to “other bad faith actions taken against IPS by Mr. Jordan and
other VAHCC employees,” but the appellant fails to provide any specifics. The appellant
complains it has been a victim of conspiracy, sabotage, and attempts to force it out of
business, speculating that Mr. Jordan and “John Doe at the VAHCC” have attempted to ruin
its reputation and its ability to obtain other contracts at the VAHCC. IPS acknowledges “this
is a prime example of tort.” IPS accuses Mr. Jordan and “John Doe” of attempting to harm
it by “avoiding payments,” and theorizes that “more evidence of bad faith will be uncovered
against IPS and other minority owned contractors through discovery.” IPS also avers that
Mr. Jordan violated its civil rights by making “disparaging racial comments against one of
IPS’ officers [Mr.Young],” and states its “belief” that VAHCC employees discriminated
against it and other minority businesses, based on race (African-American).
In order for the Board to review an allegation of bad faith action on the part of a
government official, the alleged action must be somehow tied to a provision in, or
performance of, a contract. Mr. Jordan’s outburst on May 14, 2003, was racially insensitive,
unprofessional, and wholly objectionable. We accept for purposes of deciding of this motion
that the May 13, 2007, incident occurred as IPS alleges. However, while understandably
offensive to Mr. Young, this incident and the appellant’s claims that flow from it contain no
nexus relative to the administration or performance of the telephone system contract or any
other contractual instrument issued to IPS by the VAHCC. A similar nexus is lacking with
regard to the appellant’s unsupported allegations of bad faith actions on the part of VAHCC
employees. Not only has IPS failed to adequately plead any alleged bad faith action on the
part of a VAHCC employee, it has also failed to connect such action to its ability to perform
a particular contractual instrument issued to it by the VAHCC. Also, the appellant’s
assertions that further discovery may disclose additional bad faith acts are speculative and
unpersuasive. These appeals were docketed over a year ago; the appellant has had sufficient

CBCA 12, 33, 365, 366, 367

13

opportunity to conduct appropriate discovery and find support for its assertions, if any was
to be had.3
As the Board has already indicated, some of the bad faith actions alleged by the
appellant sound in tort. A tort is defined as “[a] civil wrong, other than breach of contract,
for which a remedy may be obtained, usually in the form of damages; a breach of a duty that
the law imposes on persons who stand in a particular relation to one another.” Black’s Law
Dictionary 1526 (8th ed. 2004). We recently had occasion to review the applicable
jurisdictional prerequisites of federal tort versus federal contract actions in TAS Group, Inc.
v. Department of Justice, CBCA 52 (July 16, 2007):
Where the “tortious” act is a violation by the Government of its expressed or
implied promises under a contract, then an action lies under the statutes
waiving sovereign immunity in contract claims disputes (Tucker Act and
Contract Disputes Act) rather than those waiving immunity from tort claims
(e.g., Federal Tort Claims Act [FTCA]). “Even though . . . a breach of
contract action and tort action can co-exist, it is settled that claims essentially
based upon an alleged failure to carry out contractual duties are not tort claims
which confer jurisdiction under the FTCA.”
....
If the nature of the action is that the defending party breached its expressed or
implied contractual obligations, or that it so acted as to come within some
clause of the contract entitling the contractor to an equitable adjustment, then
the action sounds in contract and may be maintained under the Contract
Disputes Act before the Board. Thus, there must be a direct connection
between the Government’s contractual obligations and the alleged tortious
conduct. “It is not jurisdictionally sufficient if the alleged tortious conduct is

3

Concerning alleged bad faith acts on the part of a government official, we presume
that government officials act in good faith in the discharge of their duties. Overcoming that
presumption presents IPS with a high hurdle. We recently stated in Greenlee Construction,

Inc. v. General Services Administration, CBCA 416, 07-1 BCA ¶ 33,514, at 166,063, that
“a contractor who asserts that a government official was motivated by bad faith in the
conduct of his duties bears the burden of proving its assertion by clear and convincing
evidence -- ‘evidence which produces in the mind of the trier of fact an abiding conviction
that the truth of a factual contention is highly probable.’”

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merely ‘related’ in some general sense to the contractual relationship between
the parties.”
Slip op. at 3 (citations omitted); see also H.H.O., Inc. v. United States, 7 Cl. Ct. 703 (1985);
Writing Co. v. Department of the Treasury, GSBCA 15634-TD, 02-2 BCA ¶ 32,007; Thomas
D. McCloskey v. General Services Administration, GSBCA 15901, 02-2 BCA ¶ 32,006;
Asfaltos Panamenos, S.A., ASBCA 39425, 91-1 BCA ¶ 23,315 (1990). The Board can retain
jurisdiction over a tort only if there is a nexus between the tort and a contractual provision.
Goodfellow Bros., Inc., AGBCA 80-189-3, 81-1 BCA ¶ 14,917.
Even assuming arguendo, for the purpose of deciding the respondent’s motion, that
the Board viewed the appellant’s allegation as true - that Mr. Jordan was in the position to
and did adversely impact IPS’ ability to obtain future contracts at the VAHCC - the
appellant’s cause of action still lies in tort as opposed to contract. The appellant has wholly
failed to articulate how Mr. Jordan’s outburst or the acts of any VAHCC employees breached
an express or implied obligation of any contract instrument it had with the VAHCC.
Similarly, the appellant’s allegations of conspiracy, sabotage, and attempted financial
destruction contain no nexus between the potentially tortious threat made by Mr. Jordan and
the VAHCC’s administration of an IPS contract. The Board is not able to “expand” any of
the appellant’s claims to make them sound in contract. As the claims giving rise to counts
III, IV, V, VII, VIII.A, and VIII.C sound in tort, we lack jurisdiction to consider them as
expressed in the appellant’s claim.
Regarding the appellant’s claims asserting violations of civil rights and racial
discrimination, this Board does not have jurisdiction to consider those claims. Bridget Allen,
ASBCA 54696, 05-1 BCA ¶ 32,871; Charles E. Irons, ENG BCA 6318, et al., 00-2 BCA
¶ 30,965; see also Atlanta Appraisal Services, Inc. v. United States, 54 Fed. Cl. 51, 55
(2002). Jurisdiction to hear claims of discrimination is limited by Title VII of the Civil
Rights Act of 1964 and the Age Discrimination Employment Act, both of which grant
exclusive jurisdiction over race, sex, and age discrimination claims to the United States
District Courts. See Charles E. Irons. Concerning general claims of unlawful
discrimination, the Board also lacks jurisdiction. Starghill Alternative Energy Corp.,
ASBCA 49612, et al., 98-1 BCA ¶ 29,708. We are permitted, however, to review such
allegations to the extent that they might impinge on the Government’s duty to cooperate with
contractors and not impede their performance. The appellant’s burden is to prove specific
instances of unlawful discrimination that have a nexus with and adversely impacted its ability
to perform under the contract. See Green Thumb Lawn Maintenance, ENG BCA 6249, 98-1
BCA ¶ 29,688; Tarzan Construction, Inc., ENG BCA 5552, 91-2 BCA ¶ 23,887. As we
made clear supra, the appellant has failed to allege in any specific way how Mr. Jordan’s

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15

outburst or any other acts of VAHCC employees adversely impacted its ability to perform
at the VAHCC.
The appellant has cited the decision of Libertatia Associates, Inc. v. United States, 46
Fed. Cl. 702 (2000), where the Court of Federal Claims found that government officials
administering the contract acted in bad faith, resulting in an improper termination for default.
The instant appeals are distinguishable from Libertatia for a number of reasons. Libertatia
involved a termination for default. The court found that the contracting officer’s
representative (COR) in Libertatia had repeatedly demonstrated personal animosity toward
the contractor, exhibited an intent to ruin the plaintiff, obtained financial benefit for himself
during the contract, and been overzealous in his inspections, causing delays and extra
expense for the contractor. Id. at 705. These factors, the court concluded, constituted
“significant evidence that the government acted in bad faith in its administration and
termination of the contract.” Id. at 707. The court in Libertatia also faulted the contracting
officer, who it concluded had also made unprofessional comments about the contractor’s
officers, saying that the contracting officer was “at the very least, on notice of the COR’s bad
faith toward plaintiff” and “did nothing to remove the COR’s influence over the
administration of the contract.” Id. at 711.
Although Mr. Jordan’s outburst was surely offensive and unprofessional, we do not
see the facts presented here to be at all similar to those in Libertatia. The complaint contains
no well-pled allegations that IPS was at risk of default or incurred additional costs to perform
due to “bad faith acts” by a VAHCC employee. Further, IPS has provided no information
on how it believes the May 14, 2004, outburst was somehow tied to or led to an adverse
contractual action or resulted in harm to IPS during the performance of the contract. The
documents reveal that the VAHCC continued to contract with IPS for more that three years
after the incident occurred. IPS has provided no evidence that the contract was
maladministered or breached as a result of Mr. Jordan’s comment, or for that matter, that
some other improper administrative action was taken by Mr. Jordan or other VA contracting
officials. Without a nexus between alleged bad faith actions and a contract provision or
performance, the Board is without jurisdiction to consider these claims.
To recover for bad faith action by government officials under a contract - including
for tortious or discriminatory conduct - a contractor must provide a direct connection
between the alleged bad faith action and an express or implied contractual obligation or
contract term. If a bad faith, tortious, or discriminatory action on the part of a government
official is merely “related” in some general sense to a “contractual relationship” between the
parties, as opposed to a “particular contract,” we lack the jurisdiction to review those bad
faith acts. It is not jurisdictionally sufficient for a government official to have simply “acted
in bad faith.” In these appeals, the Board lacks jurisdiction to review any and all alleged bad

CBCA 12, 33, 365, 366, 367

16

faith actions, including those sounding in tort and discrimination, because the appellant has
failed to provide such a nexus. To the extent appellant seeks remedies provided by statutes
and regulations other than the CDA and its implementing regulations, the appellant must
initiate separate proceedings in the appropriate courts or tribunals. See Dan Parish v.
General Services Administration, GSBCA 16025, 03-1 BCA ¶ 32,211.
In addition to its assertions of bad faith, tort, and racial discrimination, the appellant
charges that the VAHCC has made poor telecommunications systems procurement decisions.
The Board does not have jurisdiction to review an agency’s determination of its needs or
method of fulfilling those needs. Reginald H. Martin & Associates, IBCA 3967-98, 99-2
BCA ¶ 30,417. IPS’ remedy for dissatisfaction with how the VAHCC procures its future
needs is through the bid protest arena. The CDA limits our jurisdiction to contracts between
the Government and a contractor. 41 U.S.C. § 602 (2000). We do not have jurisdiction over
bid protests because bid protests, by definition, involve disputes between the Government
and disappointed bidders. Thomas Creek Lumber & Log Co., IBCA 3917, et al., 05-2 BCA
¶ 32,976; Coyne Textile Services, AGBCA 97-104-1, 97-1 BCA ¶ 28,626 (1996); see also
Charles Hartlerode, ASBCA 52634, 02-1 BCA ¶ 31,716 (2001); 4 CFR pt. 21 (2007). Also,
we note that in its brief the respondent proffers that an “appropriate personnel action was
taken” against Mr. Jordan. The propriety of personnel actions taken against government
employees is beyond the Board’s jurisdiction. Four-Phase Systems, Inc., ASBCA 26794, et
al., 86-2 BCA ¶ 18,924.
By our decision here, the respondent’s remaining motions and the appellant’s motion
are rendered moot.
Decision
The respondent’s motion to dismiss for lack of jurisdiction is hereby GRANTED, and
the appeals of Innovative (PBX) Telephone Services, Inc. v. Department of Veterans Affairs,
CBCA 12, 33, 365, 366, and 367, are DISMISSED FOR LACK OF JURISDICTION.

_____________________________
PATRICIA J. SHERIDAN
BOARD JUDGE

CBCA 12, 33, 365, 366, 367

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We concur:

ANTHONY S. BORWICK
Board Judge

EILEEN P. FENNESSY
Board Judge

CBCA 12, 33, 365, 366, 367
CBCA#20715 CBCA 12 IPS decision wpd.wpd

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/agency%3Acbca%3A10d9b468d4009709. Public record. Not legal advice.