UNITED STATES CIVILIAN

ANNUAL REPORT

UNITED STATES CIVILIAN

BOARD OF CONTRACT APPEALS

Fiscal Year 2018

October 1, 2017 – September 30, 2018

Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

MESSAGE FROM THE CHAIR

The United States Civilian Board of Contract Appeals (CBCA) is an independent tribunal housed within

the General Services Administra on. Our mission is to provide a “just, informal, expedi ous, and inexpensive

resolu on of a case” (CBCA Rule 1). We con nually look for ways to advance our mission.

Recent developments at the CBCA include:

New Board Rules of Procedure: In proposing our new rules of procedure for Contract Disputes Act

(CDA) cases, 83 Fed. Reg. 13,211 (Mar. 28, 2018), we explained that “[t]he proposed rule simplifies and

modernizes access to the Board by establishing a preference for electronic filing, increases conformity between

the Board’s rules and the Federal Rules of Civil Procedure, and clarifies current rules and prac ces.” A er no ce

and comment, the new rules took effect September 17, 2018. 83 Fed. Reg. 41,009 (Aug. 17, 2018).

From Electronic Filing to Electronic Case Files: Several years ago, we implemented electronic filing of

cases by email. Our staff has been finalizing our internal case management system, which enables our judges to

access case files when on travel. We are transi oning from paper and electronic case files to all-electronic case

files, saving lots of paper and hole-punching, and allowing for the use of electronic Rule 4 appeal files during

hearings. These innova ons will serve our ul mate goal of processing cases as efficiently and inexpensively as

possible.

Future Increases in Disaster Disputes: In addi on to disputes under the CDA, the CBCA presides over

other types of cases. Some case types came to us from predecessor boards in the 2007 consolida on. We hear

other disputes under memoranda of understanding. In addi on, under the Robert T. Stafford Disaster Relief and

Emergency Act, we arbitrate disputes between applicants and the Federal Emergency Management Agency

(FEMA) regarding applica ons for public assistance grants to address damage caused by Hurricanes Katrina, Rita,

and Gustav.

On October 5, 2018, the Stafford Act was amended, designa ng us as the arbitrator of choice to

adjudicate disputes between applicants for public assistance grants and FEMA for any disaster that occurred

a er January 1, 2016. The amendment significantly expands the poten al pool of applicants for disaster relief

arbitra on coming before us. What this means for our docket is yet to be determined. Stay tuned!

Judge Jeri Kaylene Somers

Chair

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

DECISIONS OF NOTE

J.R. Mannes Service Corp. v. Department of Jus ce, CBCA 5638 (Nov. 12, 2017)

The contractor sought an cipatory profits it claimed it would have earned had the Federal Bureau of

Inves ga on (FBI) not terminated its contract for convenience, which the contractor claimed was done in bad

faith. Ac ng on the agency’s mo on for summary judgment, the Board recognized that contrac ng officers have

broad discre on to terminate contracts for convenience and that, absent bad faith or a clear abuse of discre on,

which was not found here, a termina on decision is conclusive. Although the contractor asserted that the FBI

abused its discre on by not complying with Office of Management and Budget Circular A-76 before bringing the

work at issue “in-house,” the Board held that the circular itself provides that noncompliance creates no basis to

challenge agency ac on or inac on, subject to excep ons not relevant to this case.

Alcazar Trades, Inc. v. Nuclear Regulatory Commission, CBCA 5837 (Feb. 27, 2018)

A er the Nuclear Regulatory Commission (NRC) awarded a task order for janitorial services to Alcazar Trades,

Inc. (ATI), ATI nego ated a new collec ve bargaining agreement (CBA). ATI submi ed the new CBA to the NRC

and requested an equitable adjustment for all op on years. The contrac ng officer denied the claim. On

appeal, the Board recognized that the task order was subject to the Service Contract Act (SCA), which requires

most service contractors to pay their employees not less than the wage rates set forth in a Department of Labor

(DOL) wage determina on, which may be based on an applicable CBA. DOL, not the contrac ng agency, decides

whether a new wage determina on applies to an op on year based on a new CBA. Because DOL had not issued

a new wage determina on under its SCA regula ons, the Board ruled it lacked jurisdic on to hear the appeal.

Mayberry Enterprises, LLC v. Department of Energy, CBCA 5961 (March 13, 2018)

Mayberry Enterprises, LLC, was awarded a construc on contract by the Western Area Power Agency (WAPA), a

component of the Department of Energy (DOE). Two months before WAPA terminated the contract for default,

Mayberry Enterprises sent the contrac ng officer an uncer fied claim le er seeking $88,000 in delay-related

costs, the release of $41,000 in retainage, and payment of an invoice for $401,000 in extra work. The

contrac ng officer did not respond. A er the default termina on, the contractor filed an appeal with the CBCA

challenging both the termina on and the deemed denial of a claim for $530,000. Gran ng in part a DOE

mo on, the CBCA held that the three claim elements were segregable and that the Board had jurisdic on under

the Contract Disputes Act to address the delay and retainage issues but not the invoice, which exceeded

$100,000 and was not the subject of a cer fied claim.

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Fiscal Year 2018 Annual Report

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Civilian Board of Contract Appeals

JBG/Federal Center, L.L.C. v. General Services Administra on and Department of Transporta on, CBCA 5506,

5715, 5849 (March 30, 2018)

Eight years into the term of a lease of Federal Center in Washington, D.C., the General Services Administra on

(GSA) began withholding some of the annual property tax reimbursement sought by the owner. GSA asserted

that it had agreed in the lease to reimburse the taxes on only part of the building’s parking lot. The contrac ng

officer also asserted a claim against the owner for past over-reimbursements. The owner disputed GSA’s

withholding and claim. The owner also submi ed a claim to the tenant, the Department of Transporta on

(DOT), arguing that, to the extent that GSA did not reimburse the property taxes, DOT should do so under a

separate parking agreement. The two disputes came before the CBCA and were consolidated. In an

interlocutory decision, the Board granted par al summary judgment to GSA and to the owner. The Board

agreed with GSA’s reading of the lease (despite GSA’s eight years of contrary behavior) and agreed in part with

the landlord that GSA’s claim for payments made more than six years before GSA asserted its claim were me

barred. The Board rejected the owner’s posi on that GSA’s en re claim was un mely.

ServiTodo LLC v. Small Business Administra on, CBCA 6055 (June 4, 2018)

In an earlier appeal, the CBCA had denied a claim by ServiTodo LLC against the Department of Health and

Human Services (HHS), on the grounds that ServiTodo and HHS had previously se led the dispute. In 2018,

ServiTodo, a small business that had contracted with HHS under sec on 8(a) of the Small Business Act, refiled

substan ally the same claim and CBCA appeal against the Small Business Administra on (SBA), arguing that SBA

had been a party to the contract, pursuant to an SBA-HHS sec on 8(a) partnership agreement, but was not a

party to the se lement. The Board ruled that ServiTodo failed to state a claim for relief in its second appeal, as

HHS was the real party in interest in the original dispute, and SBA acts under sec on 8(a) only as an agent for

small businesses, not as a contrac ng party.

NVS Technologies, Inc. v. Department of Homeland Security, CBCA 4775, 5360 (June 19, 2018)

NVS Technologies, Inc. (NVS) performed a research and development contract, which the Department of

Homeland Security (DHS) terminated for convenience a er four years. NVS submi ed a cer fied termina on

se lement proposal for $3.8 million, which it increased during nego a ons with DHS to $12.8 million without

cer fying the increased amount. The DHS contrac ng officer rejected the se lement proposal and decided that

NVS owed DHS about $600,000. NVS appealed. When the Board ques oned its jurisdic on over the uncer fied

por on of NVS’s claim, NVS cer fied and substan ally resubmi ed its increased termina on se lement

proposal, including a total of $10.3 million for “lost opportunity cost” and “cost of bad credit,” which the

proposal did not describe or itemize in any detail. The contrac ng officer denied this claim, NVS appealed, and

the two appeals were consolidated. In li ga on, NVS sought $282 million in “lost profits.” The Board granted

DHS’s mo on to dismiss this part of the case on the grounds that lost profits was a new theory of relief that NVS

had not raised in a cer fied claim.

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

B&F Distributors, LLC v. Department of Homeland Security, CBCA 5993 (June 27, 2018)

In May 2010, three years a er the contractor completed performance of 157 work orders, a Federal Emergency

Management Agency contrac ng officer issued a decision demanding $35,087 previously paid under twenty-five

of the work orders. The decision did not iden fy which work orders were at issue. The contractor began paying

the debt. In January 2018, a er obtaining a copy of an a achment iden fying the work orders that was

supposed to have accompanied the 2010 decision, and deciding that the refund demand was too high, the

contractor appealed, arguing that, because the decision was incomplete and did not explain the basis of the

demand, the ninety-day appeal period never started. The Board disagreed. It held that, although the Contract

Disputes Act requires that the contrac ng officer give reasons for a decision, it does not require specific findings

of fact, and the 2010 decision sufficed for appeal.

Collecto, Inc. dba EOS CCA v. Department of Educa on, CBCA 6001, and Transworld Systems Inc. v. Department

of Educa on, CBCA 6049 (July 26, 2018)

The Federal Student Aid Office of the Department of Educa on (DOE) awarded substan ally iden cal task orders

to EOS CCA and Transworld Systems Inc. for debt collec on services. A DOE contrac ng officer later issued final

decisions demanding from both contractors amounts that DOE said they were overpaid during DOE’s transi on

to a new data processing system. Both contractors appealed. The appeals were assigned to different CBCA

judges. DOE moved to have the cases consolidated. The contractors opposed the mo ons. In an order, the

CBCA judges denied the agency’s mo ons to consolidate their cases but agreed to coordinate the discovery

phases. The judges determined that, while the cases were similar, “[w]ith only two appellants . . . in appeals in

which only minimal discovery is an cipated, . . . the Board, through the consulta on of the two presiding judges,

can easily coordinate the development of the appeals through discovery and briefing without the need to

combine or consolidate them, at least given their current posture.”

Development Alterna ves, Inc. v. Agency for Interna onal Development, CBCA 5942, et al. (Sept. 27, 2018)

The Agency for Interna onal Development (AID) awarded five contracts to Development Alterna ves, Inc. (DAI)

for security services in Afghanistan. DAI, in turn, subcontracted with another company. The Afghan government

assessed fines against the subcontractor, which submi ed five cer fied claims to DAI, each for more than

$100,000. DAI forwarded those claims to the AID contrac ng officer, with a condi onal and defec ve

cer fica on disclaiming knowledge by DAI of the accuracy of the claimed amounts. Here, the AID contrac ng

officer informed DAI on two separate occasions that its cer fica ons did not comply with CDA requirements.

DAI elected to roll the dice and filed its appeal without correc ng the cer fica on. The Board dismissed DAI’s

appeals holding that, although a defec ve cer fica on does not automa cally deprive the Board of jurisdic on,

the defect must be inadvertent and technical. The Board deemed that DAI’s failure to correct the cer fica ons

was “reckless” and not salvageable.

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

CBCA LAW CLERK PROGRAM

The CBCA has had a robust law clerk program for many years. In fact, one of the program’s earliest par cipants

is now a CBCA Judge (see sidebar). The law clerk program is ac ve year-round, with part- me Fall and Spring

student law clerks, full- me summer law clerks, and full- me, paid, one-year post-graduate law clerks. The law

clerks assist board judges by conduc ng legal research, dra ing

legal memoranda, preparing analyses of facts, assis ng in the

Judge Kathleen O’Rourke served as

prepara on of orders and decisions, a ending hearings, and

a law clerk while comple ng her

taking part in media ons. The summer law clerks also compete

Master of Laws degree in

in a moot court compe on based upon a real CBCA case before

government procurement during

a three judge panel (see below). Since the CBCA’s mission

the academic year 2007-2008. At

includes substan al alterna ve dispute resolu on (ADR), the law

the me, she was on ac ve duty in

clerks par cipate in a mock ADR to learn the key differences

the U. S. Air Force, with the Judge

between li ga on and ADR. The program also brings in speakers

Advocate General Corps. She went

and arranges field trips.

on to serve in numerous posi ons

around the world with the Air

Force, including a tour in

Afghanistan. A er re ring from

military service, she became a

senior procurement a orney for

the First Responder Network

Authority with the United States

Department of Commerce. She

came full circle on May 29, 2016,

when she was appointed to the

CBCA by the Administrator of

General Services.

CBCA Judges Chadwick, Sullivan and O’Rourke present cer ficates to

summer law clerks Bill Fletcher and Connor Luff for winning the 2017

summer moot court compe on.

At le : Major

O’Rourke during

her me as a

CBCA law clerk

Recent field trips included a Library of Congress tour, a tour of

the U.S. Supreme Court and Q&A session with the Clerk, a visit to

the U.S. Court of Appeals for the Federal Circuit, and a visit to

the U.S. District Court for the District of Columbia, where one of

its judges provided helpful career observa ons and advice.

At right: Judge

O’Rourke on the

bench as a CBCA

Board Judge.

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

CBCA STAFF SUPPORT DIVISION

In addi on to the Judicial Division, which consists of the fourteen Board

Judges, the CBCA has a Staff Support Division composed of diverse

professionals, including a orneys, the Clerk of the Board, IT experts, and

contrac ng officers, who support the work of the judges in every way. The

Staff Support Division oversees everything from budge ng and docke ng to

the smooth opera on of the Board’s facili es, audio visual equipment, and

electronic services. The staff maintains the Board’s website for easy reference

by the public, and follows the Board’s cases from beginning to end, including

arranging for judge travel and court repor ng in those cases where a hearing is necessary.

Our staff also seeks out opportuni es to recycle

materials for use in the community. Through the

Computers for Learning (CFL) program, the Board

transferred a total of sixty-nine computer

worksta ons to the New Community for Children

(NCFC). The CFL program enables schools and

educa onal nonprofit organiza ons to obtain excess

computer equipment from federal agencies. The

Board staff made this transfer possible and

seamless.

ANTHONY GRAHAM (CBCA), KENYA MCPHERSON (CBCA), DEMI DUNSTON (NCFC),

ELIZABETH TAYLOR (NCFC), AND ROCHELLE ACHOE (CBCA)

For several years, the Board has hosted an annual luncheon in conjunc on with the ABA Public Contract Law

Sec on Young Lawyers Commi ee. The staff provides significant support for this event, which, in addi on to the

lunch, includes a panel discussion by CBCA judges, who provide prac ce ps for young lawyers appearing before

the Board. Board staff also supports various charitable campaigns, including the Combined Federal Campaign,

for which the Board met its dona on goals this year.

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

STATISTICS

The chart below details the total cases filed and resolved by fiscal year since 2008.

* 2017-2018 include separate ADR cases where there is an underlying docketed appeal.

The chart below shows all electronic filings received by the CBCA during fiscal year 2018. The Board provided

electronic filing as an op on for par es in 2013, and in this fiscal year, approximately 93% of all filings were

submi ed electronically.

Processed:

Submissions found to be compliant with the CBCA’s rules and that were included in the case record

Not Processed: Submissions deemed not proper to include in the case record, such as acknowledgment of receipt emails from one party to the other,

duplicate filings, and emails directed to the Clerk’s office regarding general questions

Rejected:

Submissions found to be non-compliant with the CBCA’s rules and that were not included in the case record, such as filings with attachments

that were not in PDF format, filings without the intended attachments, and filings in which the party submitted links in lieu of providing the

actual documents

Spam/Trash:

Spam emails, advertisements, etc.

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

STATISTICS

The chart below shows all new cases docketed by the CBCA during fiscal year 2018 by case type.

ADR

Appeal

Debt

EAJA Cost

FCIC

FEMA

FMCSA

Alternative Dispute Resolution case (no CDA appeal)

Contract Disputes Act appeal of a contracting

officer’s final decision (COFD)

Debt collection case

Equal Access to Justice Act case

Federal Crop Insurance Corp. case

Federal Emergency Management Agency case

Federal Motor Carrier Safety Administration case

ISDA

Indian Self Determination Act case

Petition

Requesting an order for a COFD

Rate

RELO

Recon

TRAV

GSA transportation audit case

Relocation expenses case

Reconsideration of any type of case

Travel expenses case

The chart below shows filings and no ces related to appeals of CBCA decisions to the United States Court of

Appeals for the Federal Circuit in FY 2018.

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Fiscal Year 2018 Annual Report

of the United States

Civilian Board of Contract Appeals

STATISTICS

The chart below shows cases in which a separate ADR was docketed in a case in which the par es had already

filed an appeal with the CBCA.

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