U.S. Coating Specialties & Supplies, LLC
Docket: ASBCA 58245
Decision date: 2017-04-06

ARMED SERVICES BOARD OF CONTRACT APPEALS 
Appeal of-- ) 
) 
U.S. Coating Specialties & Supplies, LLC ) 
) 
Under Contract No. W912EE-10-C-0019 ) 
APPEARANCES FOR THE APPELLANT: 
APPEARANCES FOR THE GOVERNMENT: 
ASBCA No. 58245 
Louis H. Watson, Jr., Esq. 
Watson & Norris, PLLC 
Jackson, MS 
Mr. Earl Washington 
Chief Operation Officer & CEO 
Thomas H. Gourlay, Jr., Esq. 
Engineer Chief Trial Attorney 
John M. Breland, Esq. 
Walker D. Moller, Esq. 
Adam Caudle, Esq. 
Engineer Trial Attorneys 
U.S. Army Engineer District, Vicksburg 
OPINION BY ADMINISTRATIVE JUDGE WOODROW ON THE 
GOVERNMENT'S RENEWED MOTION FOR SUMMARY JUDGMENT 
INTRODUCTION 
This appeal arises from the government's termination of the captioned contract 
for default. On 9 April 2015, the Board issued a decision denying the government's 
amended motion to dismiss or, in the alternative, for summary judgment. U.S. Coating 
Specialties & Supplies, LLC, ASBCA No. 58245, 15-1BCA~35,957 (U.S. Coating!). 
The government now files a renewed motion for summary judgment, contending that 
an alleged prior oral agreement between appellant and the Assistant U.S. Attorney 
(AUSA) during appellant's Chapter 11 bankruptcy proceedings is barred by the parol 
evidence rule, and alternatively, the AUSA lacked actual authority to enter into the 
alleged agreement. For the reasons set forth below, we deny the motion. 
STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION 
1. On 21June2010, the U.S. Army Corps of Engineers (Corps) awarded 
Contract No. W912EE-10-C-0019 (contract) to appellant, U.S. Coating Specialties & 
Supplies, LLC (U.S. Coating) in the amount of$11,383,000 for the construction of a 

U.S. Army Engineer Research and Development Center Information Technology 
Laboratory office building and computer facility in Vicksburg, Mississippi (R4, tab 3 
at 5-61). 
2. The contract included the standard Federal Acquisition Regulation (FAR) 
default clause, 52.249-10, DEFAULT (FIXED-PRICE CONSTRUCTION) (APR 1984), 
which provided, in pertinent part: 
(a) If the Contractor refuses or fails to prosecute the work 
or any separable part, with the diligence that will insure its 
completion within the time specified in this contract 
including any extension, or fails to complete the work 
within this time, the Government may, by written notice to 
the Contractor, terminate the right to proceed with the 
work (or the separable part of the work) that has been 
delayed .... 
( c) If, after termination of the Contractor's right to 
proceed, it is determined that the Contractor was not in 
default, or that the delay was excusable, the rights and 
obligations of the parties will be the same as if the 
termination had been issued for the convenience of the 
Government. 
(Id. at 133-34) 
3. On 13 January 2012, during performance of the contract, U.S. Coating 
sought bankruptcy protection, filing a Chapter 11 voluntary petition in the United 
States Bankruptcy Court for the Southern District of Mississippi (Bankruptcy Court) 
(R4, tab 4). 
4. On 24 February 2012, Travelers Casualty and Surety Company of America 
(Travelers), U.S. Coating's surety for the contract, filed a motion ("Dkt. #38") in the 
Bankruptcy Court, seeking relief from the automatic stay imposed by U.S. Coating's 
bankruptcy filing to enforce its rights under a General Agreement of Indemnity 
between Travelers and U.S. Coating (R4, tab 5). Travelers also filed another motion 
("Dkt. #39") on the same date to compel rejection of the contract, or alternatively, to 
1 Citations to the Rule 4 file are to the consecutively-numbered pages unless otherwise 
indicated. 
2 

compel U.S. Coating to assume or reject the contract pursuant to 11 U.S.C. § 365 
(supp. R4, tab 1 ). 
5. On 13 March 2012, Mid State Construction Company, Inc. (Mid State), U.S. 
Coating's subcontractor, filed a response and limited objection to Travelers' motion 
for relief from the automatic stay ("Dkt. #52") (R4, tab 7). Mid State also filed a 
response and limited objection to Travelers' motion to compel on the same date 
("Dkt. #53") (supp. R4, tab 3). 
6. On 13 March 2012, the AUSA for the Southern District of Mississippi, 
David N. Usry (AUSA Usry), on behalf of the U.S. Attorney, filed responses to 
Travelers' 24 February motions for the United States and the agency. In its response 
and limited joinder in Travelers' motion for relief from the automatic stay ("Dkt. 
#51 "), the United States moved to lift the automatic stay to pursue termination 
proceedings pursuant to FAR Part 49 and allow the Corps to complete the 
construction. (R4, tab 6 at 7) The United States pied that the CO "was proscribed 
from ... determin[ing] whether [U.S. Coating] was defaulted or is likely to default on the 
Contract for failure to make progress" 
(R4, tab 6 at 7, ~ 26). The United States also 
supported Travelers' motion to compel rejection of the contract, or alternatively, to 
compel U.S. Coating to assume or reject the contract (supp. R4, tab 2). 
7. The Bankruptcy Court of Mississippi issued an order on 30 March 2012, 
directing U.S. Coating, the debtor, to file a motion to assume or reject the contract by 
13 April 2012 and setting a trial on any such motion for 26 April 2012 (supp. R4, 
tab 4). 
8. After obtaining leave from the Bankruptcy Court to file its motion, U.S. 
Coating moved to assume the contract on 17 April 2012 (R4, tab 9). The United States· 
filed a response to the motion on 20 April 2012, demanding proof of U.S. Coating's 
ability to assume the contract at the 26 April 2012 trial. The response was filed by 
AUSA Usry. (R4, tab 12) 
9. Prior to the scheduled 26 April 2012 hearing, U.S. Coating, Travelers, the 
United States, and Mid State advised the Bankruptcy Court that they reached a 
settlement on pending issues set for trial and submitted a proposed order for the 
Bankruptcy Court's approval (R4, tab 20 at 452). 
10. Based on the parties' communicated settlement and proposed order, the 
Bankruptcy Court judge issued an order on 25 April 2012, stating in pertinent part: 
2 Citation is to the original pagination. 
3 

There came on for the Court's consideration for the 
following pleadings: 
A. Motion for Relief from the Automatic Stay 
[Dkt. #38] ("Automatic Stay Motion") filed by Travelers 
Casualty and Surety Company of America ("Travers" 
[sic]); 
B. Mid State Construction Company, Inc. 's 
Response and Limited Objection to Travelers Casualty and 
Surety Company of America's Motion for Relief From the 
Automatic Stay [Dkt. #52] filed by Mid State Construction 
Company, Inc. ("Mid State"); 
C. United States of America's Response and 
Limited Joinder in Travelers Casualty and Surety 
Company of America's Motion for Relief from the 
Automatic Stay [Dkt. #51] filed by the United States of 
America on behalf of the Corps of Engineers ("Corps"); 
D. Debtor's Response to Travelers' Motion for 
Relief From the Automatic Stay [Dkt. #59) filed by U.S. 
Coating Specialities [sic] & Supplies, LLC ("Debtor"); 
E. Motion to Assume Executory ("Bonded") 
Contract Held by U.S. Army Corps of Engineers [Dkt. 
#87) ("Motion to Assume") filed by the Debtor; 
F. Travelers Casualty and Surety Company of 
American's [sic] Objection to Motion to Assume [Dkt. 
#83); 
G. Mid State Construction Company, Inc. 's 
Objection to Motion to Assume Executory Contract [Dkt. 
#84]; and 
H. United States of America's Response to 
Debtor's Motion to Assume Executory ("Bonded") 
Contract [Dkt. #99). 
The Court, being fully advised in the premises and 
having considered the settlement of the foregoing 
pleadings as reflected below, finds that cause exists 
4 

pursuant to 11 U.S.C. § 362(d)(l) to grant Travelers and 
the Corps relief from the automatic stay and finds that the 
Motion to Assume should be denied and that the contract 
("Contract") between the Debtor and the Corps ... should be 
deemed rejected. 
IT IS, THEREFORE, ORDERED that the Contract 
is hereby rejected as a matter of law. 
IT IS FURTHER ORDERED that the automatic 
stay is hereby terminated in favor of the Corps and 
Travelers with respect to the Contract and General 
Agreement of Indemnity ('"GAI"). 
IT IS FURTHER ORDERED that this Order does 
not adjudicate or waive any respective rights and/or 
defenses of Travelers, the Corps, or Mid State with respect 
to the Contract, the Bonded Project, the GAI, or the 
performance and payment bonds issued by Travelers on 
the project. 
IT IS FURTHER ORDERED that, because the 
Automatic Stay Motion was sufficient to afford reasonable 
notice of the material provisions of the agreement between 
the parties and opportunity for hearing, the provisions of 
Fed. R. Bankr. P. 400l(d)(l)-(3) do not apply and the 
agreement is approved without further notice. 
ORDERED that the Stay of execution of Fed. R. 
Bankr. P. 400l(a)(3) is hereby waived. SO ORDERED. 
(R4, tab 13) The order was "AGREED TO and APPROVED AS TO FORM" by 
AUSA Usry, U.S. Coating's bankruptcy counsel, and representatives for Travelers, 
and Mid State (id. at 3). 
11. Following the issuance of the Bankruptcy Court's 25 April 2012 order, the 
contracting officer (CO), Jeri H. McGuffie (CO McGuffie), terminated the contract for 
default on the same date, asserting that U.S. Coating's consent to rejection of the 
contract constituted an anticipatory repudiation of the contract (R4, tab 2). 
12. On 30 April 2012, U.S. Coating formally filed a motion in the Bankruptcy 
Court to vacate the 25 April 2012 order. In its motion, U.S. Coating asserted that its 
consent to the settlement was based on representations made by AUSA Usry that the 
5 

Corps would terminate the contract for "reasons other than default" (R4, tab 15). The 
United States, Travelers, and Mid State filed responses to U.S. Coating's motion to 
vacate the 25 April 2012 order (R4, tabs 16-18). 
13. The Bankruptcy Court held a hearing on U.S. Coating's motion to vacate 
on 17 May 2012. Ruling from the bench, the Bankruptcy Court denied U.S. Coating's 
motion, holding that U.S. Coating's contentions were insufficient to set aside the 
25 April 2012 order. The Bankruptcy Court did not address the propriety of the 
Corps' termination of the contract for default. (R4, tab 20) The Bankruptcy Court 
subsequently issued a written Final Judgment based on the reasons articulated at the 
hearing (R4, tab 19). 
14. On 20 July 2012, U.S. Coating timely appealed from the CO's 25 April 
2012 final decision, terminating the contract for default. 
15. The Corps filed a motion to dismiss or, in the alternative, for summary 
judgment in this appeal, which was later amended, that was the subject of our 
9 April 2015 decision in US. Coating I, 15-1BCAiJ35,597 at 175,705. In our 
decision, the Board struck U.S. Coating's affirmative claims in its amended complaint 
and denied the remainder of the Corps' motion. Id. at 175,707-08. 
16. On 21January2016, the Corps filed a renewed motion for summary 
judgment in this appeal. In support of its renewed motion, the Corps submitted the 
affidavits of CO McGuffie and AUSA Usry. CO McGuffie's affidavit stated in 
pertinent part: 
2. I was the Government Procuring Contracting Officer 
who awarded and administered the contract (number 
W9 l 2EE- l O-C-0019) that is the subject of this appeal. 
3. My authority as the duly authorized Contracting Officer 
under the subject Contract was never delegated to or 
usurped by the Assistant United States Attorney who 
represented the Corps in the bankruptcy proceeding that 
involved U.S. Coating and implicated contract number 
W9 l 2EE- l O-C-0019. 
4. Because of the Contractor's actions endangering 
performance on the contract, I had clear justification for 
termination for default. Due to the significant financial 
and contractual ramifications a termination for 
convenience would have presented to the Corps and our 
customer, I never would have agreed to terminate the 
6 

contract for convenience. The Assistant United State[s] 
Attorney had no authority granted to him on the subject 
contract. Had the Assistant United State[ s] Attorney 
advised or recommended a termination for 
convenience, which he did not, I would not have 
entertained such a recommendation. 
(Gov't reply, ex. L) AUSA Usry's affidavit stated in pertinent part: 
2. I represented the United States Army Corps of 
Engineers ("the Corps") in the Chapter 11 bankruptcy 
proceedings that involved the Corps' contract, number 
W912EE-10-B-001 l,l31with U.S. Coating Specialties & 
Supplies, LLC ("U.S. Coating"), the debtor .... 
3. I had conversations with U.S. Coatings' counsel in the 
bankruptcy proceedings, Herb Irvin, and 
representatives of the debtor on multiple occasions 
during the course of the bankruptcy proceedings. 
4. During my discussions and negotiations in the 
bankruptcy proceedings with debtor's counsel and 
debtor's representatives, I never promised anyone that 
the Corps would terminate the contract for convenience 
if U.S. Coating rejected the contract in bankruptcy. 
5. During my discussions and negotiations in the 
bankruptcy proceedings with debtor's counsel and 
debtor's representatives, I never did state or otherwise 
imply that I had any authority whatsoever to bind the 
Corps to terminate the contract for convenience. 
(Gov't reply, ex. M) 
17. In its opposition to the Corps' renewed motion for summary judgment, 
U.S. Coating relies on three affidavits of its employees - President and CEO, 
Mr. Earl J. Washington; Ms. Velma Day; and Mr. Alden Brooks - originally submitted 
3 The referenced contract number appears to be a typographical error. The correct 
reference is Contract No. W912EE-10-C-0019. The referenced number, 
W912EE-10-B-001 l, pertains to Invitation for Bid No. W912EE-10-B-001 l 
(see gov't reply, ex. K). 
7 

in the earlier US. Coating I proceedings. Mr. Washington's affidavit stated in 
pertinent part: 
3. I never consented to a termination by default. I agreed 
to lift the automatic stay on the condition that U.S. 
Coating would be terminated only by convenience. I 
held this discussion with Travelers' legal counsel, the 
Respondent's legal counsel, and U.S. Coating's legal 
counsel, Herb Irvin, on April 24, 2012. 
(Gov't reply, ex. I) Ms. Day's affidavit stated that telephone discussions between U.S. 
Coating's counsel, Herb Irvin, and AUSA Usry took place on 24 April 2012, and there 
were discussions about the automatic stay being lifted to allow discussions about a 
termination for convenience (id., ex. G). Mr. Brooks'· affidavit stated that he received 
a telephone call on 24 April 2012 to attend a meeting to discuss a resolution that would 
allow for a termination of the contract for convenience. Mr. Brooks stated that U.S. 
Coating's counsel and AUSA Usry exchanged messages and it was his understanding 
that all parties agreed to terminate the contract for convenience. (Id., ex. H) 
DECISION 
Summary Judgment Standards 
The guidelines for summary judgment are well established; the granting of 
summary judgment is appropriate where there are no genuine issues of material fact 
and the movant is entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 
477 U.S. 317, 322 (1986); DIRECTV Grp., Inc. v. United States, 670 F.3d 1370, 1374 
(Fed. Cir. 2012). The movant has the burden to establish that there are no material 
facts in dispute. A material fact is one which may affect the outcome of the case. 
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). At the summary judgment 
stage, we do not resolve controversies, weigh evidence, or make determinations of 
credibility. Id. at 253. All reasonable inferences are drawn in favor of the 
non-movant. Id. at 25 5. A movant is entitled to judgment as a matter of law if the 
non-movant "fails to make a showing sufficient to establish the existence of an 
element essential to [the non-movant's] case, and on which [the non-movant] will bear 
the burden of proof at trial." Celotex Corp., 477 U.S. at 322. 
Discussion 
In US. Coating I, we concluded that summary judgment for the Corps was 
premature, stating that appellant should be given an opportunity to demonstrate that 
"its consent to the rejection of the contract was based upon an agreement with the 
government to terminate the contract, not for default, but for convenience." US. 
8 

Coating I, 15-1 BCA ~ 35,957 at 175,708. In its renewed motion for summary 
judgment, the Corps advances two new theories to bar U.S. Coating's introduction of 
an alleged prior oral agreement to terminate the contract for convenience for the 
purposes of contesting the propriety of the default termination. First, it contends that 
U.S. Coating's allegation of a prior agreement is barred by the parol evidence rule. 
Second, it contends that, even if the allegation is assumed true, the AUSA, whose 
representations U.S. Coating relies upon, lacked the requisite actual authority to bind 
the government to such an agreement. 
For the reasons set forth below, we reject both of the government's theories and 
deny the government's renewed motion for summary judgment. 
Parol Evidence Rule 
The Corps 
contends that there is no genuine issue of material fact that the 
Bankruptcy Court's 25 April 2012 order is a fully or partially integrated agreement, 
and therefore, the parol evidence rule prohibits U.S. Coating from introducing 
extrinsic evidence of an alleged prior oral agreement to contradict the terms of the 
parties' agreement. It asserts that the order was drafted, reviewed, and consented to by 
representatives of the parties involved prior to the Bankruptcy Court's issuance, and 
U.S. Coating does not contest that the order is an integrated 
agreement. (Gov't br. 
at 4; gov't reply at 16-17) The Corps also argues that the 25 April order expressly 
rejected the contract under bankruptcy law and that while the order does not contain 
terms pertaining to termination of the contract, the order stated that the Corps did not 
waive any rights with respect to the contract (gov't br. at 5; gov't reply at 15). 
In opposition, U.S. Coating contends that there are material factual disputes 
surrounding the 25 April order and the Corps' arguments "lack any evidentiary 
foundation" (app. opp'n at 7 of 8). It argues that it consented to the order in exchange 
for a termination of the contract for convenience and detrimentally relied on the 
AUSA's representations, citing to the affidavits of its employees previously submitted 
in US. Coating I (id. at 1-2, 7 of 8). U.S. Coating also contends that summary 
judgment is still premature because, while it has conducted written discovery, it has 
not orally deposed any witnesses (id. at 7 of 8). 
The parol evidence rule is a rule of substantive law that prohibits consideration 
of extrinsic evidence to alter the terms of a written agreement that "has been adopted 
by the parties as an expression of their final understanding." Barron Bancshares, Inc. 
v. United States, 366 F.3d 1360, 1375 (Fed. Cir. 2004) (citing David Nassif Assocs. v. 
United States, 557 F.2d 249, 256 (Ct. Cl. 1977)). Therefore, a writing that is final and 
complete is an integrated agreement, and the effect of integration is the inadmissibility 
of prior or contemporaneous agreements to modify or contradict the terms of the 
agreement. See David Nassif Assocs., 557 F.2d at 256; RESTATEMENT (SECOND) OF 
9 

CONTRACTS§§ 213, 215 (Am. Law Inst. 1981). Where a fully or completely 
integrated agreement exists, the writing cannot be supplemented with evidence of 
consistent or inconsistent additional terms or prior agreements that cover the same 
subject matter. Rumsfeldv. Freedom NY, Inc., 329 F.3d 1320, 1328 (Fed. Cir. 2003); 
RESTATEMENT (SECOND) OF CONTRACTS§§ 214, 216~ 
In this appeal, the parties largely dispute whether the Bankruptcy Court's 
25 April 2012 order was intended to be a completely integrated agreement. A writing 
that is signed by both parties "and apparently complete on its face, may be decisive of 
the issue in the absence of credible contrary evidence." RESTATEMENT (SECOND) OF 
CONTRACTS § 210. An integration clause creates a strong presumption that the writing 
is purported to be a completely integrated agreement. Freedom NY, 329 F.3d at 1328. 
On its face, the 25 April order contains no integration clause, nor does it contain 
express language indicating finality and completeness (SOF ,-i 10). The Corps 
concedes that the order does not contain express terms addressing termination of the 
contract (gov't br. at 5; gov't reply at 15). 
In the absence of unequivocal language indicating finality and completeness, 
we may examine the writing itself as well as the circumstances surrounding its 
execution, including the negotiations that produced it. David Nassif Assocs., 557 F .2d 
at 256; see also RESTATEMENT (SECOND) OF CONTRACTS§ 210 ("But a writing cannot 
of itself prove its own completeness, and wide latitude must be allowed for inquiry 
into circumstances bearing on the intention of the parties."). To ascertain whether the 
25 April 2012 order is a complete or partially integrated agreement, we must examine 
the parties' negotiations prior to and contemporaneous with the issuance of the order. 
See RESTATEMENT§ 209(2) ("Whether there is an integrated agreement is to be 
determined by the court as a question preliminary ... to application of the parol evidence 
rule."). 
The current record is incomplete to reach these determinations. As we 
concluded in our previous opinion, there are genuine issues of material fact regarding 
whether there was a separate oral agreement with the government to terminate the 
contract for convenience. US. Coating I, 15-1 BCA ,-i 35,957 at 175,708. Such an 
agreement, if it existed, would contradict directly the government's contention that the 
bankruptcy order is an integrated agreement. It also would call into question whether 
the contracting officer properly exercised her discretion in terminating the contract for 
default. Id. Therefore, appellant should be given an opportunity to demonstrate that 
"its consent to the rejection of the contract was based upon an agreement with the 
government to terminate the contract, not for default, but for convenience." Id. 
Finally, the Corps' emphasis on the parol evidence rule glosses over the 
implausibility of its position. It is hard to imagine why U.S. Coating would agree to 
settle the bankruptcy litigation in exchange for a 
termination for default. Indeed, U.S. 
10 

Coating's president, Mr. Earl Washington, stated in his affidavit that his agreement to 
the bankruptcy order was based on his understanding that such an order was necessary 
to proceed with negotiations with the Corps to allow the addition of a subcontractor to 
assist U.S. Coating in completing the 
contract. US. Coating I, 15-1 BCA, 35,957 
at 175,705 (citing R4, tab 20 at 23-30). Indeed, the Corps gives us no reason to doubt 
Mr. Washington's testimony that "I have not consented to any termination, and I will 
not consent to any termination" (R4, tab 20 at 33). 
Actual Authority 
Alternatively, the Corps argues that even if U.S. Coating's allegation of a prior 
oral agreement with the AUSA to terminate the contract for convenience were true, 
there is no genuine issue of material fact that the AUSA lacked actual authority to bind 
the government, and therefore, the agreement is unenforceable (gov't br. at 6-7). It 
contends that the requisite authority to make changes and determinations affecting the 
contract resides with the CO, and authority to terminate the contract for reasons other 
than default was not delegated to the AUSA, citing to J.H. Strain & Sons, Inc., 
ASBCA No. 34432, 88-3 BCA, 20,909 for support (id. at 6-7; gov't reply at 9-10 
n.4). The Corps asserts that the AUSA never communicated or implied that he had 
authority to promise a termination of the contract for convenience and U.S. Coating 
has failed to present sufficient facts proving the AUSA either made 
the alleged 
agreement or had actual authority (gov't reply at 9-13). It also argues that prior to the 
25 April 2012 order, U.S. Coating was well aware that the CO was unwilling to 
terminate the contract for convenience or entertain U.S. Coating's attempts to propose 
a substitution of contractors. It maintains that the AUSA possesses no express 
authority under the regulations to terminate a contract 
for convenience, and that his 
authority during the bankruptcy proceedings was limited to settling claims arising 
under U.S. Coating's bankruptcy filing. (Gov't br. at 6-7; gov't reply at 9) 
Like its arguments regarding the parole 
evidence rule, U.S. Coating primarily 
argues that the Corps' actual authority theory lacks evidentiary foundation. It 
contends that it detrimentally relied on the AUSA's representations, and the record 
reflects that the "sole purpose" of its consent of the 25 April 2012 order was in 
exchange for a termination of the contract for convenience. U.S. Coating also alleges 
that while it has conducted written discovery it should be entitled to further discovery 
because it has not deposed any witnesses. (App. opp'n at 7 of 8) 
The Corps' argument regarding the authority possessed by AUSA Usry misses 
the point, 
because it fails to acknowledge the statutory delegation of settlement 
authority to the U.S. Department of Justice pursuant to 28 U.S.C. § 516. As a result of 
the bankruptcy filing, litigation at the Bankruptcy Court was within the control and 
purview of the Department of Justice, whose officers, under the supervision of the 
Attorney General, are tasked to conduct and supervise all litigation on behalf of the 
11 

United States and its agencies. See 28 U.S.C. §§ 516-520; Hughes Aircraft Co. v. 
United States, 534 F.2d 889, 901 (Ct. Cl. 1976) ("[U]nless otherwise provided by law, 
the Attorney General is charged by statute with exclusive and plenary power to 
supervise and conduct all litigation to which the U.S. is a party."). 
U.S. Coating's bankruptcy filing imposed an automatic stay pursuant to 
11 U.S.C. § 362(a), prohibiting the CO from commencing administrative actions or 
proceedings against U.S. Coating. Martel Truck & Tractor Serv., Inc., ENG BCA 
No. 6191, 96-2 BCA ~ 28,368 at 141,649. Therefore, the Corps could not terminate 
the contract for default absent permission from the Bankruptcy Court. Id. at 141,650. 
The government acknowledged this constraint in its filings before the Bankruptcy 
Court, when it stated that the bankruptcy stay prevented it from "determin[ing] 
whether [U.S. Coating] was defaulted or is likely to default on the Contract for failure 
to make progress so as to endanger performance" (SOF ~ 6). While the Corps suggests 
that the CO could have pursued a termination of the contract for the government's 
convenience without violating the stay, it does not cite to any case law to support this 
assertion. 
The Corps cites to a Board decision, J.H. Strain & Sons, 88-3 BCA ~ 20,909, to 
support its contention that the alleged agreement was not binding because 
CO McGuffie, as the person authorized to make decisions related to the contract, did 
not delegate her authority to the AUSA. The Corps reliance on this decision is 
misplaced. In J.H. Strain, the Board concluded that a settlement agreement, 
negotiated by an engineer trial attorney but not approved by the CO, was 
unenforceable against the government. The engineer trial attorney, as a limited agent 
of the CO under the applicable procurement regulations, lacked authority to settle 
without delegation from the CO. Id. at 105, 702. In this appeal, the AUSA, as the 
authorized representative of the Attorney General, possesses the exclusive authority to 
settle matters in litigation before the United States bankruptcy courts. Because the 
AUSA's authority is exclusive, the question of whether the CO has delegated her 
authority is irrelevant. 
The Corps also contends that the applicable regulations contained within 
28 C.F .R. Part 0, Subpart Y, do not delegate authority to an AUSA to terminate a 
contract for convenience. Again, this argument misses the point that the AUSA, as the 
authorized representative of the Attorney General, possesses the exclusive authority to 
settle litigation before the United States bankruptcy courts. Subject to limitations, the 
regulations, in effect at the time of the Bankruptcy Court's 25 April 2012 order, 
redelegated authority to U.S. Attorneys to initiate suits, accept or reject compromises, 
and take any other action necessary to protect the interests of the United States. This 
specific suit and compromise authority may be further redelegated in writing to 
AUSAs. See 28 C.F.R. §§ 0.160, 0.168; 28 C.F.R. Pt. 0, Subpt. Y, App., sections I 
and 4 of Directive No. 1-10. There is no dispute that AUSA Usry, acting on behalf of 
12 

the U.S. Attorney, negotiated and settled matters arising from the Bankruptcy Court's 
25 April 2012 order which, according to the Corps, is the parties' settlement 
agreement. "A settlement agreement.. .arises when a claimant relinquishes its right to 
litigate its claim." Massie v. United States, 166 F .3d 1184, 1188 (Fed. Cir. 1999). 
U.S. Coating relies on the existence of an alleged prior agreement to terminate 
the contract for convenience to challenge the propriety of the default termination, and 
matters arising under the 25 April 2012 order served as the underlying basis for the 
termination. Although U.S. Coating has not adequately informed the Board reasons 
why additional discovery consisting of oral depositions of witnesses was necessary to 
its opposition (see FED. R. C1v. P. 56(d)), we conclude that the Corps is not entitled to 
judgment as a matter of law on the factual record and further development is needed. 
See NL.R.B. v. Smith Indus., Inc., 403 F.2d 889, 893 (5th Cir. 1983) (court should 
deny summary judgment if facts and circumstances have not been sufficiently 
developed to make a correct determination of the question oflaw). In particular, U.S. 
Coating 
should have an opportunity to fully develop the facts surrounding the parties' 
negotiations at the Bankruptcy Court. See Monarch Assurance P.L.C. v. United States, 
244 F.3d 1356, 1365 (Fed. Cir. 2001) (while commenting that likelihood of proving 
actual authority was remote, the Court granted additional discovery because, on 
balance, possible harm and appearance of unfairness outweighed inconvenience to the 
government). 
CONCLUSION 
The government's renewed motion for summary judgment is denied. 
Dated: 6 April 2017 
(Signatures continued) 
13 
Administrative Judge 
Armed Services Board 
of Contract Appeals 

I concur 
~~ 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
Administrative Judge 
Vice Chairman 
Armed Services Board 
of Contract Appeals 
I certify that the foregoing is a true copy of the Opinion and Decision of the 
Armed Services Board of Contract Appeals in ASBCA No. 58245, Appeal of U.S. 
Coating Specialties & Supplies, LLC, rendered in conformance with the Board's 
Charter. 
Dated: 
14 
JEFFREY D. GARDIN 
Recorder, Armed Services 
Board of Contract Appeals