Concept_Phone-in-Motel-Room_399638Medium-224x300Last Friday, the Federal Circuit issued another decision in the relatively long-running saga of the SUFI Network Services, Inc. v. U.S. litigation, which relates to a telephone network installed by SUFI Network for guests in Air Force lodging facilities in Germany. The decision is down in the weeds of several damages law issues, but it appears to break some new ground that may be helpful for other contractors pursuing damages claims against the Government.

By way of necessary background, a 2004 decision by the ASBCA established that the Air Force Nonappropriated Funds Purchasing Office materially breached a contract by allowing/facilitating service members’ attempts to avoid SUFI Network’s rates (e.g., by using calling cards), resulting in a partial settlement agreement under which the phone network became the Air Force’s property. That partial settlement left open possibilities for litigating lost profits and other damages claims. The ASBCA then the Court of Federal Claims had issued rulings differing with respect to the damages amounts; last May, the Federal Circuit vacated “much of” the Court of Federal Claims’ “lost profits” decision. The lost profits claims have been the subject of a subsequent ASBCA decision on remand. While we await further review of the recent ASBCA decision, the Federal Circuit’s decision from last week addressed SUFI Network’s claims for attorneys fees and expenses related to its pursuit of lost profits, as well as the extent to which a contractor litigating a non-CDA claim can recover lost profits and overhead related to pursuing damages claims. The Federal Circuit came down on the contractor’s side on most of these issues.

The Federal Circuit’s opinion addressed five different legal questions. The issues of “interest” on the awarded attorneys fees and the “standard rates” awarded (sections III and IV of the opinion, respectively) appear to apply relatively straight-forward legal rules and do not merit comment. The court’s rulings regarding “exhaustion” of claims, ability to pursue attorneys fees, and whether the contractor could be awarded an amount to compensate it for overhead and lost profits related to attorneys fees paid to pursue its expectancy claims merit discussion.
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GSA FSS LogoThe Federal Circuit’s decision in CGI Federal Inc. v. United States addressed the relationship between FAR Part 12—which applies to acquisitions of commercial items—and FAR Subpart 8.4, which addresses the Federal Supply Schedule (FSS) program. The case involved an RFQ issued under the FSS program by the Centers for Medicare & Medicaid Services

In the decades since the enactment of the Contract Disputes Act (CDA), contractors, agencies, and the tribunals that decide government contract disputes have grappled with the question of what constitutes a claim. In 2010, the Federal Circuit ruled in M. Maropakis Carpentry, Inc. v. U.S. that to raise the adjustment of contract terms as a defense when litigating a CDA claim, a contractor must satisfy the CDA’s jurisdictional and procedural prerequisites by filing a claim with the contracting officer (CO) and receiving a final decision. To some, the Federal Circuit’s Maropakis decision appeared to impose an additional burden on contractors litigating CDA claims. Total Engineering, Inc. v. U.S., a recent decision from the CFC, helpfully suggests a limited application of the Maropakis decision.
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Editor’s note: This is first post in a series focused on protest allegations related to cost and price analyses. Planned future posts will discuss limits on the adjustments an agency can make, benchmarks an agency may use in a realism analysis, the role of an offeror’s technical approach in a price/cost realism analysis, price reasonableness, and recent protest decisions involving cost/price analysis issues.  

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Disappointed offerors often challenge an agency’s price or cost realism analysis in a bid protest. Contractors should be familiar with the differences between cost and price realism, when each analysis is required, and the relevant FAR provisions. Understanding these foundational concepts is essential when considering or litigating a protest that raises cost or price realism analysis issues; it can be helpful when responding to a solicitation that anticipates a price or cost realism analysis.


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Group of Business People Discussing Business IssuesEditor’s note: This is the fifth and final post in a series focused on protest allegations related to discussions with offerors. Previous posts in the series addressed (1) differences between clarifications and discussions, (2) the requirements for discussions to be meaningful, (3) misleading discussions, and (4) unequal discussions. It’s been fun, but there’s only so much to discuss about discussions (for now).

As this series has shown, disappointed offerors often raise protest allegations related to discussions. Although protesters frequently allege that discussions were unequal, misleading, or not meaningful, challenges based on these allegations can be difficult to win. In researching decisions to include in this round-up, I found only two decisions issued in 2014 sustaining a protest based on a discussions issue: Kardex Remstar LLC, which was discussed in the series’ first post, and Marathon Medical Corp.). Of course, although many of the protests discussed didn’t result in sustained protests based on the facts presented, they often provide useful insights for contractors in developing new claims and are worth close study.
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Editor’s note: This is the fourth post in a series of posts focused on protest allegations related to discussions with offerors. The first post addressed differences between clarifications and discussions. The second post focused on the requirements for discussions to be meaningful. The third post dealt with misleading discussions. The final post in the series will provide a round-up of recent protests involving discussions.

The principles of fair and equal competition drive many aspects of procurement law and policy. These principles are evident in the FAR’s requirement that when an agency engages in discussions with offerors, the agency cannot “engage in conduct that [f]avors one offeror over another.” Discussions often occur as part of the procurement process, and can be beneficial to the agency and offerors. However, discussions have their drawbacks. If an unsuccessful offeror believes that other offerors were given better direction or provided with more information, discussions can provide the basis for a protest based on purportedly unequal discussions.
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Mislead Inform Switch Shows Misleading Or Informative Advice

Editor’s note: This is the third post in a series of posts focused on protest allegations related to discussions with offerors. The first post addressed differences between clarifications and discussions. The second post focused on the requirements for discussions to be meaningful. Planned future posts will cover what constitutes unequal discussions and a round up of recent protests involving discussions.

Agencies often engage in discussions with offerors as part of the procurement process. Discussions can be useful to contractors because the questions asked and issues raised can direct an offeror to areas of its proposal needing improvement. In some situations, discussions can help a contractor turn an unacceptable proposal into a successful offer. However, information provided by an agency during discussions can also lead an offeror in the wrong direction. If the agency selects another proposal, the disappointed offeror may file a protest and argue that the discussions were misleading. But what qualifies as misleading discussions? How specific does an agency need to be when it engages in discussions? These are issues that contractors should be mindful of as they engage in discussions—and that they must understand to frame potential protest issues when they are not the prevailing offeror.
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Waiting your callsRarely does a pro se plaintiff defeat a motion to dismiss at the CFC. However, the CFC recently denied the Government’s motion to dismiss a pro se plaintiff’s breach of contract claim based on the Federal Trade Commission’s (FTC) alleged failure to comply with the rules it established in a contest seeking a solution to the problem of robocalls. The court’s opinion in Frankel v. United States provides a good refresher on basic tenets of contract law: offer and acceptance.
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Editor’s note: This is the first post in a series of posts focused on protest allegations related to discussions with offerors. Planned future posts will cover what qualifies as meaningful discussions, what constitutes unequal discussions, and a round up of recent protests involving discussions.

iStock_000032523472SmallIn a bid protest, the disappointed offeror often alleges that the agency failed to conduct meaningful discussions or engaged in unequal discussions. A threshold inquiry is whether the agency engaged in discussions. The CFC and GAO approach the question of whether agency communications constitute discussions differently, and a protester may want to consider that difference when selecting a protest forum.


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Legal SettlementIn a recent decision, the Federal Circuit added to its precedent explaining how a trial court should analyze what would have occurred in a “non-breach world” for purposes of awarding expectancy damages in a contract case. In Stockton East Water District v. United States, the Federal Circuit held that the trial court failed to sufficiently consider the parties’ conduct during the six years leading up to the breach when awarding damages for the breach period. The Federal Circuit and Court of Federal Claims issued numerous decisions addressing expectancy damages and the non-breach world in the Winstar cases; Stockton East adds to that precedent with guidance for contractors presenting damages claims in the tricky situation of the Government announcing what is likely to happen several years before its conduct constitutes a breach of contractual obligations. The Federal Circuit’s decision makes clear that the contractor can point to the parties’ conduct during the pre-breach period to explain what the non-breach world would have looked like—and how expectancy damages should be measured.
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