Agility Defense & Government Services, Inc. (a/k/a Agility DGS Holdings, Inc.)
Docket: ASBCA 58870, ASBCA 59261
Decision date: 2014-11-14

ARMED SERVICES BOARD OF CONTRACT APPEALS 
Appeals of -- ) 
) 
Agility Defense & Government Services, Inc. ) ASBCA Nos. 58870, 59261 
(a/k/a Agility DGS Holdings, Inc.) ) 
) 
Under Contract No. SPM7LX-09-D-9004 ) 
APPEARANCES FOR THE APPELLANT: Gary L. Rigney, Esq. 
Jon D. Levin, Esq. 
W. Brad English, Esq. 
Maynard, Cooper & Gale, P.C. 
Huntsville, AL 
APPEARANCES FOR THE GOVERNMENT: Daniel K. Poling, Esq. 
DLA Chief Trial Attorney 
Matthew 0. Geary, Esq. 
Trial Attorney 
DLA Land and Maritime 
Columbus, OH 
Gregory T. Allen, Esq. 
Trial Attorney 
Defense Contract Management Agency 
Chantilly, VA 
OPINION BY ADMINISTRATIVE JUDGE THRASHER ON 
THE GOVERNMENT'S MOTION TO DISMISS FOR LACK OF JURISDICTION 
Agility Defense & Government Services, Inc., (a/k/a Agility DGS Holdings, 
Inc.) (Agility) appeals the termination contracting officer's (TCO's) settlement 
determination related to the termination for convenience of contract line item numbers 
(CLINs) 0001 through 0006 of its contract (contract termination) with the Defense 
Logistics Agency (DLA) (ASBCA No. 58870). In addition, Agility seeks $297,794.26 
resulting from DLA's constructive termination for convenience of CLIN 0002 prior to 
the contract termination (pre-termination claim) (ASBCA No. 59261). DLA moves to 
dismiss the pre-termination appeal (ASBCA No. 59261) without 1 prejudice alleging that 
1 The government's motion requests this appeal be dismissed both with and without 
prejudice (gov't mot. at 1, 6, 7). However, the government clarified this issue 
during oral arguments stating that it was requesting dismissal without prejudice 
and appellant could file its claim with the TCO (tr. 12). 

the TCO's act in terminating CLIN 0002 as part of the contract termination rendered 
this appeal moot, thereby depriving the Board of subject matter jurisdiction. The parties 
jointly requested oral arguments on the motion, which were held on 12 August 2014. 
STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION 
1. The DLA, Land and Maritime, Columbus, Ohio, (DLA) awarded an 
indefinite-quantity contract, No. SPM7LX-09-D-9004, to 
Agility on 12 December 
2008. The primary requirements under the contract were to provide industrial 
hardware supply support directly to the maintenance operations at Tobyhanna Army 
Depot, Pennsylvania, by maintaining stock in designated bin locations under a 
fixed-price CLIN (CLIN 0001) and to acquire, stock and deliver industrial hardware 
supplies to worldwide customers at various destinations in accordance with task orders 
issued under CLIN 0002. (R4, tab 1 at G-1, -2) Although the contract contained 
seven CLINs, Agility complaint only "relates to the supply of Worldwide Demand 
Items to be provided under CLIN 0002 [R4, tab 1 at G-14, -58] of the contract for 
which [Agility] was to receive a fixed price per item ... for all costs (management, 
infrastructure, item, and distribution) associated with the delivery of supplies" (comp I. 
ii 5 (citing Federal Acquisition Regulation (FAR) 52.216-18)) (emphasis added). 2 
2. The contract included the FAR 52.212-4(1), CONTRACT TERMS AND 
CONDITIONS-COMMERCIAL ITEMS (FEB 2007) clause, which states, in pertinent part, in 
the event of a government termination for convenience the contractor may recover "a 
percentage of the contract price reflecting the percentage of the work performed prior to 
the notice of termination, plus reasonable charges the Contractor can demonstrate ... have 
resulted from the termination" (R4, tab 1 at G-9). 
3. Agility began work under CLIN 0002 in September 2009. In a 
19 November 2009 memorandum decision, DLA announced that it had suspended 
The Public Warehousing Company, pursuant to FAR Subpart 9.4.3 DLA extended 
the suspension to include The Public Warehousing Company's affiliates, including 
Agility. 4 Shortly thereafter, in light of the suspension, DLA notified Agility that all 
work under CLIN 0002 was suspended. Agility, however, continued to perform work 
under other CLINs, which were not affected by the suspension. (Compl. ii 7) 
Notwithstanding the suspension of CLIN 0002 activities, Agility maintained the 
ability to perform in the event that the suspension was lifted (comp I. ii 8). 
2 All citations to the complaint reference appellant's Amended and Restated 
Complaint, filed with the Board and dated 15 May 2014 (Bd. corr.). 
3 See FAR 9.407-2(a) (providing for contractor's suspension where there exists 
adequate evidence of improprieties). 
4 See FAR 9 .407-1 ( c) (providing that suspension may extend to contractor's affiliates). 
2 

4. In June, 2011, Agility requested that DLA terminate CLIN 0002 for 
convenience in order that Agility would not incur any further expenses in maintaining 
the required inventory and the capability to perform under CLIN 0002. DLA 
refused to terminate CLIN 0002 for convenience until a succession plan was in place. 
(Compl. ~ 9) 
5. On 23 November 2011, Agility filed its pre-termination claim asserting that 
CLIN 0002 had been constructively terminated as of 19 November 2009 and that the 
government had breached its implied covenant of good faith and fair dealing by 
continuing an indefinite suspension of CLIN 0002 which necessitated that Agility keep 
certain amounts of inventory on hand in order to maintain the capability to perform, as 
required by the contract. The pre-termination claim sought reimbursement for the 
value of the inventory which Agility continued to retain under the suspension in an 
amount of $586,029.76. (Compl. ~ 11, ex. A) 
6. On 20 March 2012, Thomas J. Maul, contracting officer (CO), issued a 
final decision denying Agility's pre-termination claim in its entirety (compl. ~ 12, ex. B). 
7. On 19 June 2012, Agility received a notice that its contract would be 
terminated for 
the government's convenience on or about 27 July 2012. The termination 
was subsequently issued by contract Modification No. POOO 12 (Mod. 12), dated 31 July 
2012. Pertinent to this motion, Mod. 12 terminated contract CLINs 0001-0006 for 
convenience pursuant to FAR 52.212-4(1). (R4, tabs 4, 5) 
8. As directed by the TCO, Agility submitted a proposal for a termination 
settlement which, inter alia, addressed a portion of the inventory which had been 
maintained under CLIN 0002 (compl. ~ 14). The termination settlement proposal 
claimed a total of $509,937.79 for inventory buyback under CLINs 0001 & 0002, and 
DLA agreed to and subsequently paid Agility said amount (settlement proposal 
payment) (compl. ~ 15, ex. B). However, Agility's complaint alleges only $288,235.50 
of the settlement proposal payment is related to the pre-termination claim for costs 
under CLIN 0002 - reducing the pre-termination claim at issue to $297, 794.26 ( compl. 
~ 15). 
9. Agility filed a complaint on 21 March 2013 with the United States Court of 
Federal Claims, Case No. 13-204-C. In its complaint, Agility challenged the propriety 
of the CO's decision dated 20 March 2012. (Compl. ~ 16) 
10. On 17 June 2013, the TCO issued a final decision on Agility's termination 
settlement proposal submitted under Contract No. SPM7LX-09-D-9004 (R4, tab 30 
3 

at G-680). Agility filed a notice of appeal with the Board and the appeal was docketed 
as ASBCA No. 58870 on 12 September 2013. 
11. Pursuant to 41 U.S.C. § 7107(d), the United States Court of Federal Claims, 
by Order dated 19 February 2014, transferred Case No. 13-204-C (pre-termination 
claim) to the Board and on 15 April 2014, the matter was docketed as ASBCA 
No. 59261. 
12. On 10 July 2014, DLA filed a motion to dismiss the pre-termination 
claim (ASBCA No. 59261) arguing that the Board lacked subject matter jurisdiction 
over the dispute because the contract termination rendered this dispute 
moot. The 
parties requested oral arguments on the motion, which were held on 12 Au_rust 2014. 
Subsequently, a 
hearing on both appeals was held on 8-9 September 2014. 
DECISION 
Contentions of the Parties 
The government's motion asserts two basic arguments. First, the government 
argues that the contract termination rendered the pre-termination appeal moot because 
the remedies granted appellant by the contract termination are identical to those sought 
by the pre-termination appeal - the termination of CLIN 0002 for convenience -
thereby depriving the Board of jurisdiction to hear this appeal (gov't mot. at 3-5). 
Second, the government argues the contract termination (absent a finding of bad faith 
or clear abuse of discretion) extinguished the issue of whether there was a prior 
termination, thereby granting appellant the same remedies as under the contract 
termination. As a result, appellant's pre-termination claim became subject to the 
termination for convenience clause, FAR 52.212-4(1), depriving the Board of 
jurisdiction over the appeal because appellant failed to present the pre-termination 
claim in its entirety to the TCO and that portion of the claim ($297, 794.26) was not 
addressed under the TCO's final decision (gov't mot. at 4-6). 
Appellant responds by arguing it continues to have an interest in the outcome of 
the appeal because it has not received all the money it is due, it does allege bad faith 
and, even if bad faith was not alleged, the remedies afforded a contractor under a 
termination for convenience are not the same as when a contract is constructively 
5 Due to the timing of the motion, the parties agreed to proceed with the hearing even 
with the motion pending. 
4 

terminated. Addressing the difference in remedies, appellant argues: 
In this case, the Contract was actually terminated for 
convenience while the Pre-Termination Claim was 
pending. The actual termination of the Contract on 
July 31, 2012 does not necessarily provide the same 
remedies as a constructive termination effective 
November 19, 2009. A constructive termination for 
convenience retroactively invokes the termination for 
convenience clause and allows a contractor to recover as if 
the government had actually invoked the clause on the date 
of the government's invalid action. Praecomm, Inc. v. 
United States, 78 Fed. Cl. 5, 11 (2007). The key difference 
between the remedies from a constructive termination for 
convenience and a subsequent actual termination for 
convenience is the effective date of the termination. 
Under the termination for convenience clause, the 
contractor may recover "a percentage of the contract price 
reflecting the percentage of work performed prior to the 
notice of termination, plus reasonable charges the 
Contractor can demonstrate ... have resulted from the 
termination." FAR 52.212-4(1). The charges that 
reasonably result from a termination on November 19, 
2009 and a notice of termination on June 19, 2012 can 
differ substantially. For example, expenses incurred 
prior to the notice of termination on June 19, 2012 may 
not be considered a result of the termination. However, 
if the Contract was constructively terminated as of 
November 19, 2009, the expenses incurred after said date 
certainly would be considered a result of the termination. 
Therefore, a subsequent actual termination for convenience 
may not provide the contractor the same relief as a 
constructive termination for convenience regardless of bad 
faith. 
(App. resp. at 8-9) 
The merits of the motion 
A dispute only becomes moot when all "relief sought has been granted or ... the 
questions originally in controversy between the parties are no longer at issue." 
5 
I J 

Chapman Law Firm Co. v. Greenleaf Construction Co., 490 F.3d 934, 939-40 (Fed. 
Cir. 2007); Lasmer Industries, Inc., ASBCA Nos. 56946, 56966, 11-1BCA~34,671 
at 170,801 {appeal dismissed with prejudice as moot where contracting officer granted 
all relief requested extinguishing the dispute between the parties). In deciding a 
motion to dismiss for lack of subject matter jurisdiction, we must "accept as true, and 
construe in a light most favorable to the non-movant, only undisputed factual 
allegations." Linc Government Services, LLC, ASBCA No. 58561 et al., 14-1 BCA 
~ 35,473 at 173,933. None of the facts relevant to this motion are in dispute.6 The 
proponent of the Board's jurisdiction bears the burden of establishing jurisdiction once 
challenged. Raytheon Missile Systems, ASBCA No. 58011, 13 BCA ~ 35,241 
at 173,016. 
Did Termination ofCLIN 0002 Grant Appellant the Relief Sought and Extinguish the 
Dispute? 
We disagree with the government's conclusion that the relief granted under the 
pre-termination claim and the contract termination would be the same; appellant still 
has cognizable interests in the outcome of this appeal because contract termination of 
CLIN 0002 does not necessarily provide appellant the same relief as under the 
pre-termination claim. As noted by appellant, the timing of the termination order may 
have a significant impact on the measure of potential recovery under the terms of the 
commercial termination clause, FAR 52.212-4(1 ), and could potentially differ under 
each procedure (app. resp. at 8-9; tr. 18). This is true whether or not bad faith is 
alleged. Therefore, termination of CLIN 0002 did not grant appellant the full relief it 
sought or extinguish the dispute so as to render the appeal moot. 
We also disagree with the government's argument that we lack jurisdiction over 
the pre-termination claim because it ceased to be an independent claim when 
CLIN 0002 was terminated and appellant has not submitted its settlement claim to the 
. TCO as required. The pre-termination claim and the CO's denial of the claim predated 
the contract termination 
(SOF ~~ 5-6). Independent claims are not necessarily merged 
into the termination of the same contract under which the claim arose and may be 
appealed separately from the termination for convenience appeal. James M Ellett 
Construction Co. v. United States, 93 F.3d 1537, 1548 (Fed. Cir. 1996); RW 
Electronics Corp., ASBCA No. 46592, 96-2 BCA ~ 28,540. 
6 The government concedes the remedies available under a constructive termination 
and termination of CLIN 0002 would not be identical if there were a finding of 
bad faith but argues appellant has not alleged bad faith in its pleadings (gov't 
mot. at 5, 6 n.2). Appellant disputes this fact, noting it alleges bad faith in its 
claim (SOF ~ 5), and its complaint (compl. ~ 11) (app. resp. at 7). However, it 
is not necessary for us to address this disputed fact to decide his motion. 
6 

CONCLUSION 
Construing the undisputed facts in a light most favorable to appellant, we conclude 
that the government's termination of CLIN 0002 for convenience did not grant appellant 
all the relief it sought nor resolve the dispute at issue under its pre-termination appeal so 
as to render this appeal moot. The government's motion to dismiss is denied. 
Dated: 14 November 2014 
I concur 
~~4 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
minist ative Judge 
Armed Services Board 
of Contract Appeals 
I concur 
RICHARD SHACKLEFORD 
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 Nos. 58870, 59261, Appeals of 
Agility Defense & Government Services, Inc. (a/k/a Agility DGS Holdings, Inc.), 
rendered in conformance with the Board's Charter. 
Dated: 
7 
JEFFREY D. GARDIN 
Recorder, Armed Services 
Board of Contract Appeals