In ECC Int’l Constructors Inc. v. Army, No. 2021-2323 (Fed. Cir. Aug. 22, 2023), the Court of Appeals for the Federal Circuit overturned longstanding precedent by holding that the requirement to state a “sum certain” in a claim submitted under the Contract Disputes Act (CDA) is not a jurisdictional requirement. The Court based its decision on recent Supreme Court guidance to “treat a procedural requirement as jurisdictional only if Congress ‘clearly states’ that it is.” The Court parsed the CDA and found that Congress never used the words “sum certain,” evidencing that Congress did not intend the requirement to be jurisdictional. This is important because jurisdictional requirements can be raised at any time—even years after the claim was filed and a full hearing on the merits was held—and result in dismissal of the case. The Court explained that the “sum certain” is “nonetheless a mandatory rule that claimants must follow.”
Money Talks, But So Do Other Impacts: ASBCA Underscores that a Claim with Possible Financial Impacts Is Not Fundamentally a Monetary Claim Unless It Has No Other Significant Consequences
On May 15, 2023, the Armed Services Board of Contract Appeals (“ASBCA” or “the Board”) in J&J Maintenance, Inc., d/b/a J&J Worldwide Services, ASBCA No. 63013 issued an instructive analysis of its jurisdiction to hear monetary and nonmonetary claims. Partially granting a government motion to dismiss, the ASBCA explained that, if a contractor does not seek monetary relief in its claim to the contracting officer (“CO”), then the contractor cannot seek monetary relief on appeal to the Board. Addressing the contractor’s claim for contract interpretation, however, the Board denied the government’s motion to dismiss and held that, where a contractor can reasonably articulate “significant consequences” of its claim other than the recovery of money, the fact that the claim may also have a financial impact on the parties does not strip the Board of jurisdiction.
ASBCA’s FY2022 Report – A Look at the Numbers
On November 1, 2022, the Armed Services Board of Contract Appeals (ASBCA) published its FY 2022 Report of Transactions and Proceedings, which provides statistics regarding the adjudication of appeals between contractors and the Army, Navy, Air Force, Corps of Engineers, Central Intelligence Agency, National Aeronautics and Space Administration, Defense Logistics Agency, Defense Contract Management Agency
Board Upholds Measured-Mile Methodology to Calculate Disruption
In Lockheed Martin Aeronautics Company, ASBCA No. 62209, the Armed Services Board of Contract Appeals (“Board”) denied the Air Force’s motion for summary judgment, which had argued that the “measured mile” approach to calculating disruption was legally untenable. In its decision, the Board noted that it has “accepted the measured mile approach as an
Job Corps Center Prime Contractors Will Now be Subject to the Service Contract Act Requirements
The Department of Labor (“DOL”) recently announced in a July 29, 2022 Change Order notice that the Wage and Hour Division (“WHD”) had revised the Field Operations Handbook (“FOH”) by deleting the exemption under the Service Contract Act (“SCA”) for federal contracts to operate Job Corps Centers. Prime contractors and subcontractors operating these centers will now be subject to the SCA and FAR 52.222-41, Service Contract Labor Standards, according to DOL.
The practical effect of this change is that covered contractors must pay the minimum wages and “bona fide” fringe benefits mandated by the SCA to all covered workers, which includes workers who are “non-exempt” under the Fair Labor Standards Act. The required wages and fringe benefits for these workers are set forth in wage determinations that are incorporated into the applicable contract by the contracting agency. Higher tier contractors must also flow down the SCA Clause (FAR 52.222-41) and all applicable wage determinations to lower tier contractors. All covered contractors must meet the SCA’s posting and recordkeeping requirements. See 29 CFR 4.183, Employees must be notified of compensation required; 29 CFR 4.184, Posting of notice; 29 CFR 4.185, Recordkeeping requirements.
Laches Defense No Longer Available in ASBCA Appeals
In Lockheed Martin Aeronautics Company, ASBCA No. 62209 (a C&M case), the Board granted Lockheed Martin’s motion for summary judgment on the issue of whether the Government can assert laches as an affirmative defense to a Contract Disputes Act claim. In a case of first impression, Lockheed Martin argued that the affirmative defense of
You Snooze, You Lose: Contractor’s Compensation Costs are Not Expressly Unallowable When the Government Delayed in Setting Annual Cap
In Ology Bioservices, Inc., ASBCA No. 62633 (May 20, 2021), the Armed Services Board of Contract Appeals (the Board) held that the Government could not assess a penalty on the contractor’s fiscal year (FY) 2013 compensation costs for being expressly unallowable when the Government delayed publishing the compensation cap for FY 2013 by more
“Here before. Many times. And without resolution.” – Board’s Dismissal of Contractor’s Appeals as Moot Precludes Analysis of Costs Repeatedly Disallowed on the Same Grounds
In L3 Technologies, Inc., ASBCA Nos. 61811, et al. (Mar. 1, 2021), the Armed Services Board of Contract Appeals (Board) granted the Government’s motion to dismiss the appeal, over the contractor’s objection, following the Contracting Officer’s (CO) unequivocal withdrawal of its cost disallowance claims. The contractor argued that its case was not moot despite
Show Me the Money? When a Sum Approximate Counts as a Sum Certain
In Creative Management Services, LLC, dba MC-2 v. U.S. (Feb. 26, 2021), the Federal Circuit affirmed a Court of Federal Claims decision dismissing a contractor’s appeal of the government’s Contract Disputes Act (CDA) claim as untimely, holding that the contractor appealed more than 12 months after receiving a contracting officer’s (CO) final decision. On appeal, the contractor alleged that the final decision was not a valid claim because it did not state a “sum certain” as required by the CDA, and this deficiency meant that the 12-month appeal period had not started to run.
The contractor was awarded a General Services Administration (GSA) task order to provide marketing and logistical support for an annual GSA conference, and was required to keep the revenue it collected for the conference in a trust account. When GSA canceled the conference in the fourth year and asked the contractor to return all remaining money in the trust account, the contractor refused and submitted a termination for convenience proposal to GSA. GSA subsequently issued two letters to the contractor demanding an accounting of the trust account and all money that remained in it. The CO then issued a final decision on the contractor’s termination proposal and on GSA’s claim to the remaining funds in the trust account, without providing a dollar amount. The contractor filed suit three years after the final decision was issued, challenging the government’s claim to the trust account funds.
Continue Reading Show Me the Money? When a Sum Approximate Counts as a Sum Certain
CARES Act Section 3610 Relief Extended Until September 30, 2021
The American Rescue Plan Act of 2021 (the Act), signed into law by President Biden on March 11, 2021, extends Section 3610 of the CARES Act (previously discussed here, here, and here) through September 30, 2021. The extension allows federal agencies to reimburse contractors for six additional months of paid-leave costs if