ANHAM FZCO, LLC
Docket: ASBCA 59283
Decision date: 2017-07-20

ARMED SERVICES BOARD OF CONTRACT APPEALS 
Appeal of --
ANHAM FZCO, LLC 
Under Contract No. SPM300-10-D-3373 
APPEARANCE FOR THE APPELLANT: 
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APPEARANCES FOR THE GOVERNMENT: 
ASBCA No. 59283 
Eric J. Marcotte, Esq. 
Vedder Price P.C. 
Washington, DC 
Daniel K. Poling, Esq. 
DLA Chief Trial Attorney 
John F. Basiak Jr., Esq. 
Keith J. Feigenbaum, Esq. 
Theodore E. Lorenz, Esq. 
Trial Attorneys 
DLA Troop Support 
Philadelphia, PA 
DECISION BY ADMINISTRATIVE JUDGE KINNER ON THE 
GOVERNMENT'S MOTION FOR SUMMARY JUDGMENT 
The government moves for summary judgment to deny the appeal of ANHAM 
FZCO, LLC. The motion was filed 8 February 2017. Appellant filed its opposition 
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7 March and the government replied 17 April. For the reasons stated below we deny 
the government's motion for summary judgment. 
STATEMENT OF FACTS FOR PURPOSES OF THE GOVERNMENT'S 
MOTION FOR SUMMARY JUDGMENT 
On 14 April 2010, ANHAM FZCO, LLC (ANHAM) was awarded an 
indefinite-quantity contract to procure, store and distribute food and non-food items to the 
military and other federal customers in Kuwait, 
Iraq and Jordan (R4, tab 1 at 47, tab 27 at 1). 
The contract was awarded and administered by the Defense Supply Center Philadelphia 
(DSCP), now called the Defense Logistics Agency - Troop Support (DLA TS) (R4, tab 27). 
In the contract ANHAM assumed the role of Prime Vendor responsible for management of 
the food inventory. Management of the inventory included a requirement to maintain a 
45-day supply ready for distribution to federal customers. ANHAM was also responsible for 
forecasting the monthly demand from the troops in the war zone. Although the government 
is only required to order the specified minimum quantity in an indefinite-quantity contract, 
the federal customers surpassed that amount in this contract. (R4, tab 1 at 47-48) 

The contract required food to be purchased in the United States. Once it reached 
the Middle East, ANHAM stored food in warehouses in Kuwait. To maintain 
appropriate inventory levels, ANHAM needed to maintain a flow of food to the Kuwait 
warehouses from American suppliers. This was accomplished through an extended 
"pipeline" beginning with trucks transporting food to warehouses in the United States, 
then to ports. Ships transported the food to Kuwait and trucks brought the food to 
ANHAM's warehouses before distribution by truck to troops in Iraq. (R4, tab 14 at 12) 
During the solicitation process potential offerors were concerned with the 
possible withdrawal of American troops from Iraq. The President had made many 
public statements about his intention to withdraw troops (e.g. app. opp'n, ex. C). If the 
contract was terminated prematurely it was possible that the contractor would not 
recoup the significant costs that would be incurred (app. opp'n, ex. A if 11, ex. B 
at 275). The attendees at the 14 May 2008 pre-proposal conference expressed these 
concerns. Amendment No. 0003 added the transcript of bidder questions from the 
conference to the solicitation. Question number 12 in the conference asked: 
The White House administration will change after the 
November elections, and this solicitation is "all at risk". 
What steps will DSCP take to mitigate PV losses if troops 
are withdrawn? Will this loss mitigation include repayment 
for facilities constructed in anticipation of contract award? 
Will it cover PV products stocked in support of this massive 
requirement? This will amount to hundreds of millions of 
dollars. 
Ans.: 1) Draw down period; 2) No, this contract has a 
guaranteed minimum and that is all that the 
Government is required to order and pay for under the 
contract; 3) Again, draw down period will exhaust 
pipeline product[.] 
(R4, tab 3 at 20) Question number 124 at 
the conference asked: 
Page 34: Notification to extend contract 3 days? What are 
we supposed to do with our buildings, personnel assets and 
on the water pipeline of supplies if 3 days prior to the 1st 
option periods or any period we are terminated? 
Ans.: DSCP will provide notice of intent 60 days prior to 
the expiration of a performance period. This does not 
guarantee that the government will exercise the option. 
With regard to buildings, personnel assets and on the 
water pipeline of supplies, the government provides a 
contract minimum and the contractor assumes the risk. 
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We anticipate that a ramp down period will mitigate 
risk. 
(Id. at 33) Question number 134 at the conference asked: 
Page 70: If the Democratic candidate wins the election in 
November 2008 and they pull the troops out of the Middle 
East-what happens to our assets, warehouse, personnel and 
products in house and in the pipeline? 1 percent 
guaranteed? 
Ans.: There are too many assumptions here. If a troop 
pull-out were to occur, DSCP would develop a ramp 
down/exit strategy. The minimum contract value 
remains at 1 °/o. 
(Id. at 35) The amendment stated that the "[t]he answers in Section II are provided for 
clarification purposes only and do not change the requirements in the solicitation" 
(id. at 2). 
Shortly after receiving award of the contract, ANHAM entered a service 
agreement with Jassim Al Wazzan Sons General Trading Co., W.L.L. (Wazzan) for 
lease of a warehouse in Kuwait, known as the Logistica warehouse (app. opp'n, ex. A; 
R4, tabs 25, 72). That agreement had a term of 18 months with a 6-month extension 
provision. The initial term of the agreement would expire 31December2011 (app. 
opp'n at 9, ii 18). 
In November 2008, during the final year of President Bush's term, the United States 
entered a Status of Forces Agreement (SOFA) with Iraq. The SOFA was effective as of 
1 January 2009. It established that American troops would leave the country by 
31 December 2011. The SOFA caused DLA TS to amend the solicitation on 29 May 2009 
to reduce the term of the contract. Amendment No. 0018 to the solicitation changed the 
base period of the contract to 18 months and established 4 one-year options. (R4, tab 14) 
Notwithstanding the existing SOFA, it was not until 21 October 2011 that President Obama 
finalized the decision that no United States troops 
would remain in Iraq in 2012 (gov't mot. 
at 11, ii 40). 
Before the withdrawal decision was finalized, ANHAM became concerned about 
the impending drawdown of troops (app. opp'n, ex. A; R4, tab 54). But in June 2011, 
DLA TS encouraged ANHAM to plan to feed at Thanksgiving and Christmas the same 
number of troops it fed earlier in the year (am. comp I. ii 24). Later, in September, 
ANHAM proposed to reduce its available warehouse 
assets or have the government pay 
for the storage space. DLATS did not support ANHAM's proposed reduction. Instead, 
DLA TS advised ANHAM that it had to maintain its resources for full performance of 
the contract. Contrary to that advice, food orders dropped significantly in October and 
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drastically fell in November and December. (Id. iii! 28-29) The government does not 
challenge ANHAM's allegations that DLA encouraged planning for significant troop 
levels in the final months of 2011. 
United States troops were completely withdrawn from Iraq by 18 December 2011. 
ANHAM had shipments of food in its pipeline at that time. ANHAM had also renewed 
the lease for its largest warehouse in Kuwait until 30 June 2013 (am. compl. if 31). 
ANHAM submitted a claim on 28 August 2013 to the DLA TS contracting officer for 
$10,989,020 which it allegedly incurred for lease of the warehouse between 1 January 
2012 and 15 January 2013 (am. compl. if 39). DLATS denied the claim. ANHAM filed 
its complaint 23 July 2015. DLA TS filed its answer to the complaint 20 May 2016. 
The answer asserted six affirmative defenses (answer at 34, iii! 1-22). First, 
DLA TS alleges that the claim is barred by the Sovereign Acts Doctrine because it 
characterizes ANHAM's claim as seeking costs resulting from the government's 
decisions concerning military troop movements or classification of such information. 
Second, DLATS asserts the claim is barred by the Political Question Doctrine because 
the claim concerns wartime decisions by the President. Third, DLATS argues 
appellant's claim should be dismissed because it assumed the risk that events in an 
active war zone could increase its costs. Fourth, DLA TS asserts that ANHAM waived 
its right to pursue this claim because it renewed the lease that caused its increased costs. 
Fifth, DLATS claims ANHAM's claim is barred because it failed to mitigate its 
damages. Sixth, DLATS alleges that the representation in ANHAM's proposal that the 
warehouse was leased for the duration of the contract was inaccurate which it asserts is 
a material breach by ANHAM that excuses it from liability. 
DECISION 
A. Standard of Review for Summary Judgment 
We look to Rule 56 of the Federal Rules of Civil Procedure for guidance in 
deciding motions for summary judgment. Board Rule 7(c)(2). It is settled law that 
summary judgment will be granted where ( 1) the material facts are undisputed and 
(2) the moving party is entitled to judgment as a matter oflaw. The moving party has 
the burden of demonstrating both elements. IMS Tech., Inc. v. Haas Automation, Inc., 
206 F.3d 1422, 1429 (Fed. Cir. 2000). Here the government has failed to establish its 
entitlement to summary judgment on either element. 
B. Disputes of Material Facts Preclude Summary Judgment 
The government asserts in its motion that it is entitled to summary judgment 
because there are no disputed issues of material fact. It relies upon a recitation of facts 
that are similar to the facts alleged in ANHAM's complaint. (Gov't mot. at 2-12) But 
the government's statement of facts differs significantly from appellant's allegations 
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because it does not address ANHAM's allegations that DLATS actively misled the 
contractor regarding the impending departure of United States Armed Forces from Iraq. 
Specifically, ANHAM alleges in its complaint that DLATS insisted 
throughout 2011 
that it possessed no information concerning plans for the withdrawal of American troops 
from Iraq. ANHAM claims such representations by DLA TS were untruthful because 
the government had established a military departure date in an operational order issued 
6 January 2011, OPORD 11-01 (app. opp'n at 10, ~ 22). That order directed the 
removal of troops from Iraq in 2011. ANHAM also claims that DLATS was aware the 
operational order was amended in May 2011 to narrow the period in which troops 
would be withdrawn to 14 October to 18 December 2011 (app. opp'n at 11, ~ 25). 
ANHAM alleges DLA TS withheld that 
information and instead informed ANHAM that 
plans had not been established for a drawdown of troops (id. at 11-12, ~~ 26-27). 
ANHAM further alleges that DLA TS knowingly encouraged it to use incorrect troop 
estimates when planning for food stocks through 2011 (id. at 12-13, ~~ 29-30, at 15-16, 
~~ 36-40, at 18, ~ 42, at 21, ~ 48). 
As required, ANHAM's opposition does not merely rely upon its complaint. The 
party opposing summary judgment cannot rest upon allegations in its pleadings, but must 
respond by affidavits or otherwise, setting forth specific facts to show the existence of a 
genuine issue for trial. Adamation, Inc., ASBCA No. 22495, 80-1BCA~14,385. 
ANHAM's allegations are supported by documents in the Rule 4 file (e.g. R4, 
tabs 48-72), documents submitted with its opposition (app. opp'n, exs. B-F, H-J) and the 
affidavit of Beau Lendman, the senior vice president of the company (app. opp'n, ex. A). 
These allegations identify disputed material facts that preclude summary judgment. 
Notwithstanding these disputed facts DLA TS requests summary judgment. The 
gravamen of ANHAM' s claim is that the government was aware that it was 
withdrawing its personnel from Iraq by the end of 2011, but kept this knowledge from 
ANHAM, thus violating its contractual duty of good faith and fair dealing. DLA TS 
asserts 
that ANHAM's claim should be denied for three reasons. First it assumed the 
risk that troops could be withdrawn. Second, it suffered no damages. Third its claim is 
barred by the Sovereign Acts Doctrine. According, to the government the Board may 
consider these arguments and disregard ANHAM's allegations ofDLATS' 
misrepresentations discussed above. DLA TS asserts ANHAM' s allegations should be 
ignored because the operational order was classified and troop level estimates are 
irrelevant. More specifically, DLATS argues that its actual knowledge of how many 
troops ANHAM had to be prepared to feed is irrelevant. According to DLATS, its 
actions are irrelevant because ANHAM renewed the warehouse lease which is the 
subject of its claim three months before the President's final agreement regarding a 
continuing presence of United States troops in Iraq. DLATS also asserts troop 
projections are irrelevant because ANHAM was already aware of the SOFA which 
precluded troops remaining in Iraq past 31 December 2011 and Amendment No. 0018 
of the solicitation had reduced contract requirements in response to the SOFA. 
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The government does not specifically address allegations that DLATS personnel 
knowingly misrepresented information about the planned withdrawal and purposefully 
encouraged ANHAM to rely upon false troop estimates. DLA TS does not attempt to 
justify withholding information from the contractor. Nor does it justify its statements 
misleading the contractor about the plan to withdraw troops in 2011. The government, 
instead, unsuccessfully attempts to evade the point of ANHAM's claim. 
DLA TS cannot ignore the obvious relevance of information it possessed 
regarding the number of troops in Iraq, classified or not. Depriving the contractor of 
access to that information would undermine ANHAM's ability to perform the contract. 
It was ANHAM's responsibility to formulate an estimate of the number of people to be 
fed every month. It based its food inventory on these estimates. IfDLATS advised use 
of inflated estimates it could cause ANHAM to project higher demand, causing 
increased costs in procurement, shipping and storage. This is precisely ANHAM' s 
claim-that DLA TS' s misrepresentations caused it to extend the warehouse lease. 
DLA TS' direction that ordering had to be based on current 
troop strength, rather than projections, would also impede 
moving to a smaller warehouse. Thus, ANHAM had no 
choice but to exercise an extension of the Logistica 
warehouse lease. 
(Am. compl. ~ 31) 
ANHAM further alleges that the operational order had established a specific plan 
to leave Iraq by the middle of December (am. compl. ~~ 8-9). To the extent that 
DLATS's representations to ANHAM during performance conflict with the existence, 
or the contents, of OPORD 11-1 it is relevant and material to ANHAM's claim. If 
DLA TS urged ANHAM to use false troop projections, either in conflict with OPORD 
11-1, or to support it, those facts are material and relevant. The parties' dispute 
concerning DLA TS access to the plan to withdraw troops in December 2011 prevents 
consideration of summary judgment. 
The government's description of the SOFA as the public plan for troop withdrawal 
is a similarly disputed material fact. The SOFA did not establish a definitive plan upon 
which ANHAM 
could base troop projections. DLATS's actions in 2011 demonstrate 
ANHAM could not rely upon the SOFA. ANHAM learned that the SOFA was 
meaningless for planning purposes from DLATS's insistence there was no plan for troop 
withdrawal. ANHAM claims it was consistently informed by DLA TS in 2011 that there 
was no established plan for troop withdrawal from Iraq (am. compl. ~~ 20, 23-24, 26, 29, 
31 ). DLA TS again confirms this in its reply. In 2017 DLA TS still argues that "a decision 
by President Obama to withdraw troops from Iraq was not made until mid-October 2011" 
(gov't reply at 8). DLA TS also asserts that during 2011 ANHAM knew "the United 
States might withdraw all troops from Iraq by December 2011, and might not" (id. at 9). 
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Contrary to the fact statement in the government's motion, the SOFA did not provide 
ANHAM knowledge to counteract misrepresentations by DLATS. 
The government argues alternatively that ANHAM's claim seeks the same costs it 
recovered through regular contract payments. It claims ANHAM was paid the cost of 
the warehouse as part of the contract's normal distribution price (gov't reply at 2). But 
the government produced no proof of such payments or how the payments covered costs 
for warehousing excess inventory. DLA TS does not explain how payments ANHAM 
received during contract performance for procurement and distribution of food would 
also account for the storage cost of excess food beyond the amounts necessary during 
performance. This is especially unclear in light of the government's separate 
reimbursement to ANHAM after the contract for the cost of the excess inventory 
accumulated in the final months of 2011 as well as the cost of destruction of that 
inventory (id.). 
Rather than support summary judgment, these arguments establish that the facts 
material to ANHAM's claim are in dispute. As the party opposing a motion for summary 
judgment, ANHAM is to be given the benefit of all reasonable doubt in determining 
whether a genuine factual issue exists. Adamation, 80-1BCA~14,385. ANHAM 
controverts the central premise of the government's motion. DLATS's motion primarily 
rests upon an allegation that ANHAM assumed the risk that troops might leave while it 
had food stored in its warehouse. The government supports that argument with 
ANHAM' s proposal in which it describes and accepts the risk of a major withdrawal of 
troops (gov't mot. at 21-26). But the government's determination to remove troops from 
Iraq is not the premise of ANHAM's claim. ANHAM claims that its assumption of risk in 
this contract did not include assuming the risk of government misinformation. Assuming 
ANHAM's allegations to be true for the purposes of the government's motion, the 
contractor had no basis to assume that DLATS's representations regarding troop 
withdrawal were false. ANHAM could reasonably assume that the government, as its 
contracting partner, would not purposely mislead it. ANHAM was responsible for 
formulating monthly projections of the number of federal personnel it would feed. 
Information regarding troop disposition was a critical component of such estimates. 
Misrepresentations by DLA TS of facts pertaining to government plans to withdraw troops 
from Iraq would undermine ANHAM's ability to form reliable projections of federal 
personnel to be fed in coming months. Thus, ANHAM alleges it relied upon the 
misinformation provided by the government. Its allegations can be fairly read to also 
assert that the government intended the contractor to rely upon the false troop projections 
provided by DLATS. 
It is likely that ANHAM relied upon DLATS's misinformation because it 
contradicted available public information. DLATS's allegations regarding the 
President's desires to withdraw troops from Iraq, and even that he entered the SOFA 
promising to do so, do not deflect ANHAM's allegations. ANHAM has provided 
evidence that, in discussions concerning troop levels DLA TS showed complete 
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disregard for the SOFA. Contrary to that agreement, DLA TS urged ANHAM to plan 
for 80,000 troops in November. Contrary to the agreement, DLA TS advised ANHAM 
to prepare for the same level of personnel late in 2011 as it had been serving earlier in 
the year. DLA TS confirms this in its motion. DLA TS asserts that there was widely 
held public knowledge that the United States and Iraq "were in high-level discussions to 
possibly keep some troops in Iraq beyond December 2011" (gov't mot. at 10, ii 36). It 
argues that, up to the final agreement with Iraq, the President was negotiating whether 
troops would remain in Iraq in 2012 (gov't reply at 8). Thus, the SOFA was 
disregarded by DLA TS and the President was allegedly working contrary to its terms. 
In that environment, the public information available to ANHAM regarding the 
President's intentions was little more than talk. 
DLATS further argues that ANHAM's reliance upon the statements made by 
DLATS and recorded in Amendment No. 0003 of the solicitation is misplaced (gov't 
reply at I). DLA TS asserts the information in Amendment No. 0003 is irrelevant 
because the amendment stated it was for clarification only and did not change the 
requirements of the solicitation. The statements in Amendment No. 0003 are also 
allegedly irrelevant because that discussion pertained to troop levels throughout the 
Middle East, encompassing Jordan and Kuwait, not exclusively Iraq. DLATS also 
argues that the questions at the pre-proposal conference were "expressly not 
incorporated into the Solicitation or Contract." (Gov't reply at 2) Contrary to 
DLATS's characterization, ANHAM argues that the representations at the conference 
were incorporated into the contract (app. opp'n at 31). ANHAM supports its argument 
with citation to the copy of the contract in the Rule 4 file at tab 27. On page 2 of that 
exhibit, the contract provides that the solicitation, the amendments to the solicitation 
and ANHAM's proposals are incorporated into the contract. Also contrary to DLATS's 
argument, it is not clear from the text of Amendment No. 0003 that the government's 
expectations for a drawdown period applied only to zones outside Iraq. Only one of the 
three statements in which DLA TS predicts a drawdown period refers to the wider 
Middle East. Nor is it clear that government references to a future ramp down of troops 
is a change to the requirements of the solicitation. 
These and other disputed material facts prevent consideration of summary 
judgment on this record. 
C. DLA TS Requests Summary Judgment on Three Theories. 
1. The Contract did Not Shift Risk of Misrepresentation onto the 
Contractor. 
By its motion, DLA TS makes the same misrepresentations to the Board that it 
made to ANHAM during performance. The government recognizes in its motion that 
ANHAM claims that DLA TS breached the implied duty of good faith and fair dealing 
by withholding information regarding the withdrawal of United States forces from Iraq. 
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The government nonetheless claims it is entitled to judgment as a matter of law because 
ANHAM assumed the risk of troop withdrawals. DLA TS claims ANHAM was aware 
of widely disseminated public information that the government was pursuing an 
agreement for troop withdrawal and no one, including DLATS, knew until October 
2011 whether troops would remain in Iraq. DLA TS represents that the agency was 
unaware early in 2011 of internal plans to ensure the complete withdrawal of American 
troops from Iraq. DLA TS claims it could not violate its duty to cooperate with 
ANHAM because it simply did not possess information with which it could mislead the 
contractor. DLATS goes so far as to claim informing ANHAM in July or September 
2011 that all troops would be out of Iraq in December would have been "a risky wild 
guess" (gov't reply at 8). This assertion is not merely contrary to ANHAM's 
allegations, it is baseless. 
ANHAM' s claim that it was misled by DLA TS is based upon the issuance of 
OPORD 11-1. It claims that DLA TS possessed precise knowledge of the planned 
precipitous drop in "mouths to feed" between October and December 2011 (app. opp'n, 
ex. A). Specifically, the military was directed in May 2011 by amendment to OPORD 
11-1 to prepare for and execute withdrawal of all troops by 18 December 2011, including 
a drastic reduction of troops beginning 14 October. DLATS does not attempt to refute 
ANHAM's allegations. DLATS apparently believes it can ignore allegations pertaining 
to OPORD 11-1. This is similar to DLA TS' s assertions to ANHAM during the contract. 
It would like to be considered ignorant of the plans to withdraw troops from Iraq in 2011. 
Perhaps it believes this feigned ignorance is somehow persuasive in 
litigation as well. It 
is not. 
As noted above, ANHAM supports its allegations with documents in the Rule 4 
file, other external documents and the affidavit of its senior vice president. The 
correspondence shows DLA TS insisted ANHAM maintain the peak level of provisions 
through the end of 2011, contrary to the planned withdrawal of troops (app. opp'n, ex. F). 
As late as September 2011, the contracting officer informed ANHAM that the agency 
·'has yet to receive official information available for public release regarding the 
reduction of personnel in Iraq and Kuwait" (R4, tab 72 at 52). Following that, the 
contracting officer specifically encouraged ANHAM to utilize inflated projections of 
troops to be fed through 2011 and into 2012 (app. opp'n, ex. A ii 24). 
This evidence is sufficient to establish a prima facie case of breach of the duty of 
good faith and fair dealing by DLA TS. The government's plan to withdraw troops was 
vital information for the contractor to plan and execute its performance through 2011. 
ANHAM did not assume the risk that the government would withhold or falsify 
information regarding the troops to be fed in October, November and December of 
2011. Having assumed the contractual obligation to formulate troop projections and 
maintain food inventory based on the projections, ANHAM necessarily asked the 
government for information to make its projections as accurate as possible. If the 
government responded with false information it would have acted to specifically 
9 

undermine the contractor's ability to obtain the fruits of the contract within the terms of 
the bargain. 
This contract, like other contracts, implicitly contains a covenant of good faith 
and fair dealing. MetcalfConstr. Co. v. United States, 742 F.3d 984, 990 (Fed. Cir. 
2014). The covenant imposes on each party a "duty not to interfere with the other 
party's performance and not to act so as to destroy the reasonable expectations of the 
other party regarding the fruits of the contract." Lakeshore Eng 'g Servs., Inc. v. United 
States, 748 F.3d 1341, 1349 (Fed. Cir. 2014). The duty is found within the context of 
the contract to ensure neither party acts inconsistent with the contract's purpose or 
deprives the other party of the contemplated value. MetcalfConstr., 742 F.3d at 991. 
The government's motion disregards these principles when it argues that the contract 
limits its exposure to ANHAM' s costs. The government cannot rely upon its limited 
obligations in the Indefinite-Quantity clause to preclude recovery by ANHAM (gov't 
mot. at 27). The Indefinite-Quantity clause does not shield DLA TS from its obligation 
of good faith in performance. John McCabe, ASBCA No. 36958, 89-2 BCA ~ 21,857. 
In that clause, ANHAM agreed that the government may exercise its discretion to limit 
the amount of business it will do and it will not be liable for purchases beyond that 
amount. Thus, the contractor agreed to cede determination of the scope of the contract 
to the government's discretion. In doing so, it did not also surrender the government's 
compliance with other contractual obligations. Case law uniformly recognizes that 
contract provisions that grant the government discretion are accompanied by an implied 
obligation not to abuse that discretion and to act in good faith. Id. at 109,948 (citing 
Monarch Enterprises, Inc., ASBCA No. 31375, 86-3 BCA ~ 19,227 at 97,224). Here, 
ANHAM claims the government failed to act in good faith when it purposefully 
thwarted the contractor's ability to formulate troop projections. It further claims that 
DLA TS' s misrepresentations deprived ANHAM of the means of contract performance 
and the ability to protect itself from unreasonable increased costs. 
The purpose of this contract was for ANHAM to act as the Prime Vendor to 
federal customers in Iraq, Kuwait and Jordan for the supply and delivery of food and 
non-food items (gov't mot. at 2, 4). This responsibility included inventory management 
which required ANHAM to determine the monthly demands and maintain a 45-day 
supply in its warehouse (id. at 5). With those responsibilities, ANHAM assumed the 
risk that decisions regarding troop deployment could result in unrecovered costs (id.). It 
is evident that ANHAM' s ability to manage that risk would depend upon its skill in 
inventory management which logically required the best assessment of demand 
possible. It does not appear that the government was obligated to assist in the 
assessment of demand. Thus, the nature of the bargain placed on ANHAM the burden 
of determining the amount of food to stock in its warehouse and the risk that it could 
overstock at its cost if demand decreased. 
Assuming the risk of forecasting demand, ANHAM could not reasonably expect 
the government to assist in determination of troop levels. But, ANHAM could reasonably 
10 

expect the government not to interfere in its monthly determinations. Contrary to that 
reasonable expectation, ANHAM has provided evidence that the government advised it to 
use inflated troop estimates when planning food demand in the final months of 2011. In 
doing so, the government failed to act in good faith. Good faith in contractual relations 
means "honesty in fact in the conduct or transaction concerned." McCabe, 89-2 BCA 
ii 21,857 at 109,948. The government's alleged actions fail that standard even ifit could 
offer a legitimate legal basis for withholding or misrepresenting this information. The 
mere lawfulness of conduct by public officials does not preclude a tribunal from finding 
that such conduct still violates standards of decency, fairness or reasonableness. JA. 
Jones Constr. Co., ASBCA No. 43344, 96-2 BCA ii 28,517. Accordingly, drawing all 
justifiable inferences in favor of the party opposing summary judgment, we conclude that 
appellant has raised sufficient issues regarding the government's good faith and fair 
dealing in performance of the contract to withstand summary judgment and entitle it to a 
trial on the merits. 
2. The Government Offers No Evidence to Support its Presumption that 
ANHAM has No Compensable 
Damages. 
The government argues that it is entitled to summary judgment because ANHAM 
represented in its proposal that it had retained the warehouse that is the subject of its 
claim for the entire length of the contract. DLA TS claims that if ANHAM had initiated a 
lease for the contract period it would not have incurred damages because its warehouse 
costs would be covered as part of regular contract payments (gov't mot. at 26). DLA TS 
further asserts that ANHAM did not need to execute an extension of its agreement to 
lease when it did. ANHAM' s decision was allegedly premature because the lease 
extension was not required before the end of September 2011. DLA TS insists that if 
ANHAM's agreement to lease the warehouse covered the exact period of the contract 
"there would have never been an issue about the Logistica lease expiring on 
December 31, 2011 and its alleged damages would have been zero." (Gov't mot. at 28) 
When faced with the decision whether to renew the warehouse lease, DLATS 
argues ANHAM had two options to mitigate its costs (gov't mot. at 29). ANHAM 
could have sought a three-month extension of the warehouse lease which would have 
aligned it with the contract. Or, ANHAM could have obtained the six-month extension 
which was already available in its agreement 
with Wazzan. That extension would have 
gone only three-months longer than the contract. According to ANHAM, this is a 
Hobson's choice. Neither option would have accommodated the excess inventory 
procured pursuant to DLATS's false predictions. Thus, DLATS's argument is incorrect 
because it is misdirected. The claim is not premised upon ANHAM' s alleged difficulty 
with its decision to renew its agreement with W azzan. ANHAM claims the 
misrepresentation by DLA TS of projected troop levels at the end of 2011 and beyond 
caused the need for continued warehouse 
storage. ANHAM argues that the significant 
volume of excess food required warehouse storage until 13 September 2013 (app. opp'n 
11 

at 46; R4, tab 72 at 68-71). Accepting that allegation as true, DLATS's argument for 
summary judgment fails. 
3. ANHAM's Claim is Not Presumptively Barred by the Sovereign Acts 
Doctrine. 
DLA asserts entitlement to summary judgment because ANHAM' s contract 
claim is barred by the Sovereign Acts Doctrine. The sovereign acts defense is an 
inherent element of every contract to which the government is a party, whether or not 
explicitly stated. The government retains in every contract the authority to act as 
sovereign unless it surrenders this right in "unmistakable terms." Hughes 
Communications Galaxy, Inc. v. United States, 998 F.2d 953, 958 (Fed. Cir. 1993). In 
this case, as DLA TS argues, the United States' determination to withdraw troops from 
Iraq pursuant to an agreement with the government of Iraq is a sovereign act. But, that 
fact alone may not bar the claim. As described above, ANHAM's complaint does not 
claim entitlement to compensation because there was a decision that troops would be 
withdrawn. ANHAM's claim is that DLA's withholding of information regarding that 
decision was contrary to its contract bargain. Concealing the plan to remove troops 
from Iraq deprived ANHAM of the ability to manage the inventory and facilities it is 
obligated to maintain under the contract. 
The information ANHAM claims DLATS withheld was the specific military 
direction regarding the departure of troops from Iraq. As discussed above, ANHAM 
asserts that OPORD 11-01 explicitly established a date on which troops would leave 
Iraq (am. compl. at 5-6, ~~ 18-9; app. opp'n at 10-12). DLATS's motion and reply are 
silent regarding ANHAM's arguments regarding OPORD 11-01. This may be 
DLATS's attempt to avoid discussion of that document based upon its security 
classification. Failing to address the classification of OPORD 11-01, or to assert its 
classification as a sovereign act, does not support its motion. There is no basis for 
DLATS's failure to respond to ANHAM's arguments about the order or its discovery 
requests. DLA TS' s motion does not provide any reason for withholding information 
regarding the number of troops to be fed in the ending months of the contract. The 
government has apparently reserved those arguments for a hearing. Also, having 
included this point as an affirmative defense in its answer, it tacitly acknowledges that it 
must carry the burden of proof. DLA TS does not to meet that burden on summary 
judgment. 
And DLA TS did not try in its motion to prove that a sovereign act prevented 
compliance with its duty not to interfere with the contractor. Rather it presents its 
sovereign act defense as afait accompli that warrants dismissal of ANHAM's complaint. 
DLA TS overstates this defense. At this point of discovery, it's not nearly so 
accomplished. Even if the sovereign acts defense applies, "it does not necessarily mandate 
dismissal." Carabetta Enters., Inc. v. United States, 482 F.3d 1360, 1365 (Fed. Cir. 2007) 
(quoting United States v. Winstar, 518 U.S. 839, 895 (1996)). The government is excused 
12 

from performance under the sovereign acts defense only when the sovereign act renders 
the government's performance impossible. Casitas Municipal Water Dist. v. United 
States, 543 F.3d 1276, 1287 (Fed. Cir. 2008). The classification of OPORD 11-01 does 
not establish that it was impossible for DLA to cooperate with ANHAM's contract 
performance. 
DLATS's presumption that the mere presence of a sovereign act results in 
dismissal is based upon its reading of Robertson & Penn, Inc. d/b/a Cusseta Laundry, 
Inc., ASBCA No. 55625, 08-2 BCA ~ 33,951. In that case the contractor was to supply 
laundry services to military camps but the invasion of Iraq sharply reduced the amount 
of services required in the camps. If that case is similar to this one, the similarity stops 
there. In Robertson, the contractor claimed the government negligently estimated the 
amount of laundry that would be done because it knew the troops would be deployed 
away from the camps. The contractor's claim went further to blame the deployment 
itself as a basis for entitlement to additional compensation. The Board rejected that 
particular argument because the troop deployment was a sovereign act for which the 
government is not liable in the context of the contract. That is not the nature of the 
claim here. 
Am. Gen. Trading & Contracting, WLL, ASBCA No. 56758, 12-1BCA~34,905 
is a more analogous decision. Although also a negligent estimate claim, in that case the 
Board separated the question of the government's reasonable care in estimating 
requirements from the fact that those requirements might have been driven one way or 
another by potential sovereign acts. The troop deployment that affected the laundry in 
Am. Gen. Trading did not eliminate the government's obligation to exercise reasonable 
care to estimate its requirements. If the contractor could show that the government 
knew, or should have known, that the invasion of Iraq was imminent, and as a result its 
laundry estimate for the camps was wrong, the government would be liable for the 
breach resulting from that misrepresentation. The government's error would be its 
failure to take into account a sovereign act. Based on that, the Board held that the 
sovereign act defense did not apply to the contractor's negligent estimate claim. 
That is the result here. The sovereign act defense does not apply to ANHAM's 
fair dealing claim because the government's liability, if any, arises from DLATS's 
failure to disclose information needed by the contractor. As in Am. Gen. Trading, 
whether the government reasonably provided or withheld troop estimates from 
ANHAM is a different question than whether those estimates might have been driven 
one way or another by potential sovereign acts. ANHAM should have an opportunity to 
demonstrate whether DLA TS withheld its knowledge of the planned troop withdrawal. 
13 

CONCLUSION 
The government's motion for summary judgment is denied. The government has 
not established entitlement to summary judgment because material facts remain in 
dispute and it is not entitled to judgment as a matter of law~ 
Dated: 20 July 2017 
I concur (see separate opinion) 
RICHARD SHACKLEFORD 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
14 
DONALD E. KINNER 
Administrative Judge 
Armed Services Board 
of Contract Appeals 
I concur 
Administrative Judge 
Acting Vice Chairman 
Armed Services Board 
of Contract Appeals 

OPINION BY ADMINISTRATIVE JUDGE SHACKLEFORD 
I concur in the result because I agree that there are disputed material facts that 
preclude summary judgment. I also concur in the examination and rejection of the 
government's argument with respect to Sovereign Acts because that argument does not 
depend upon the existence or nonexistence of disputed material facts. 
The remainder of the opinion which analyzed several arguments to determine 
whether the government could be entitled to judgment as a matter of law (were there no 
material disputed facts) is obiter dicta and unnecessary to the results. I do not join in 
that discussion. 
Dated: 20 July 2017 
RICHARD SHACKLEFORD 
Administrative 
Judge 
Acting 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. 59283, Appeal of ANHAM 
FZCO, LLC, rendered in conformance with the Board's Charter. 
Dated: 
15 
JEFFREY D. GARDIN 
Recorder, Armed Services 
Board of Contract Appeals