ARMED SERVICES BOARD OF CONTRACT APPEALS 
Appeal of -- ) 
) 
Public Warehousing Company, K.S.C. ) 
) 
Under Contract Nos. SP0300-03-D-3061 ) 
SPM300-05-D-3119 ) 
SPM300-05-D-3128 ) 
APPEARANCES FOR THE APPELLANT: 
APPEARANCES FOR THE GOVERNMENT: 
ASBCA No. 59020 
Michael R. Charness, Esq. 
Jamie F. Tabb, Esq. 
Vinson & Elkins LLP 
Washington, DC 
Daniel K. Poling, Esq. 
DLA Chief Trial Attorney 
John F. Basiak, Jr., Esq. 
Nathaniel A. Work, Esq. 
Keith J. Feigenbaum, Esq. 
Trial Attorneys 
DLA Troop Support 
Philadelphia, PA 
OPINION BY ADMINISTRATIVE JUDGE THRASHER 
ON THE GOVERNMENT'S PARTIAL MOTION TO DISMISS FOR LACK OF 
SUBJECT MATTER JURISDICTION AND MOTION FOR SUMMARY JUDGMENT 
This appeal arises from the three captioned Prime Vendor contracts between 
appellant, Public Warehousing Company, K.S.C. (PWC), and the Defense Supply Center 
Philadelphia (DSCP), since renamed DLA Troop Support, a component of the Defense 
Logistics Agency (DLA). PWC appeals from the denial of its 5 December 2011 certified 
claim, as revised by its 26 February 2013 letter, seeking $4,605,594.53 in interest 
penalties allegedly due pursuant to the Prompt Payment Act, as amended, 31 U.S.C. 
§§ 3901-3907, and the terms of the captioned contracts. Our jurisdiction to entertain this 
appeal derives from the Contract Disputes Act of 1978 (CDA), 41 U.S.C. §§ 7101-7109. 
The government originally moved to dismiss this appeal, in part, for lack of 
jurisdiction, alleging that portions of appellant's claim were barred by the CDA's 
six-year statute of limitations, 41 U.S.C. § 7103(a)(4)(A). Following full briefing on the 
government's partial motion to dismiss, the United 
States Court of Appeals for the 
Federal Circuit issued its decision in Sikorsky Aircraft Corp. v. United States, 773 F.3d 
1315 (Fed. Cir. 2014). By order dated 15 December 2014, the Board requested 
supplemental briefing regarding the impact of Sikorsky on the government's motion. 

In response to the Board's 15 December 2014 order, the government filed a 
document titled, "DLA's Motion for Summary Judgment and Supplemental Brief in 
Support ofDLA's Partial Motion to Dismiss." In this submission, the government 
"renews its Partial Motion to Dismiss for Lack of Subject Matter Jurisdiction and also 
moves for Summary Judgment on the grounds that ... PWC's untimely requests for 
[Prompt Payment Act] interest are barred" (gov't mot. at 2).1 In addition, the government 
seeks summary judgment on the basis that the exception for payments related to military 
contingency operations in the Office of Management and Budget's (OMB's) regulations 
implementing the Prompt Payment Act, 5 C.F.R. § 1315. l(b)(2), precludes PWC from 
succeeding on its claim (gov't mot. at 2, 13-16). 
In Sikorsky, as the government acknowledges, the Federal Circuit held that the 
six-year statute of limitations in the CDA is not a jurisdictional bar. 773 F.3d at 1320-22. 
The court's decision in Sikorsky is binding on this Board. Kellogg Brown & Root 
Services, Inc., ASBCA No. 58175, 15-1BCAii35,988 at 175,825; Combat Support 
Assocs., ASBCA Nos. 58945, 58946, 15-1 BCA ii 35,923 at 175,591, vacating on recon. 
14-1BCAii35,782. Because the CDA's six-year statute of limitations "provides no 
basis to dismiss an appeal for lack of jurisdiction," Combat Support, 15-1BCAii35,923 
at 175,591, the government's partial motion to dismiss for lack of subject matter 
jurisdiction is denied. Accordingly, we address only the government's motion for 
summary judgment below. 
1 The government acknowledges that the Federal Circuit held in Sikorsky that the CDA's 
six-year statute of limitations is not jurisdictional (gov't mot. at 16-17). However, 
the government argues that, with respect to the statute of limitations issue, 
dismissal for failure to state a claim upon which relief can be granted is 
appropriate (id. at 18-20). Although the government casts its statute of limitations 
argument in terms of dismissal for failure to state a claim, the government does 
not cite to the allegations in PWC's complaint, but rather speaks of an absence of a 
dispute of material fact (id. at 19-20). In its response, PWC treats the 
government's submission as seeking summary judgment on the statute of 
limitations issue (see app. resp. to gov't mot. at 58-59). The government does not 
contradict this characterization in its reply. We therefore treat the government's 
submission as seeking partial summary judgment based upon the CDA's six-year 
statute of limitations. Cf Dick Pacific/GHEMM, JV, ASBCA No. 55829, 08-2 
BCA ii 33,937 at 167,941 (noting that where the parties present matters outside the 
pleadings that are not excluded by the Board, a motion to dismiss for failure to 
state a claim is typically treated as a motion for summary judgment). 

STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION 
The Prompt Payment Act and Its Implementing Regulations 
1. Congress enacted the Prompt Payment Act, Pub. L. No. 97-177, 96 Stat. 85 
(1982), to "provide incentives for the Federal Government to pay its bills on time" and to 
"relieve private vendors of the unfair burdens which they frequently must bear as a result 
of doing business with the Government." H.R. Rep. No. 97-461, at 1, 11 (1982), 
reprinted in 1982 U.S.C.C.A.N. 111, 121. To accomplish these goals, if a federal agency 
failed to make a payment by the required payment date, the Prompt Payment Act required 
the agency to pay an interest penalty in accordance with regulations prescribed by the 
Director of the Office of Management and Budget (OMB). Pub. L. No. 97-177, 
§ 2(a)(l), 96 Stat. 85. 
2. OMB implemented the Prompt Payment Act by issuing OMB Circular A-125. 
Issuance of Circular A-125, "Prompt Payment," 47 Fed. Reg. 37,321(Aug.25, 1982). 
OMB revised Circular A-125 in 1984, 
1985, and 1987. Issuance of Attachment to OMB 
Circular 
A-125, Prompt Payment, 49 Fed. Reg. 28,140 (July 10, 1984); Issuance of 
Attachment 2 and Other Revisions to OMB Circular A-125, "Prompt Payment," 50 Fed. 
Reg. 14,688 (Apr. 12, 1985); Revision to Circular No. A-125, "Prompt Payment," 52 Fed. 
Reg. 21,926 (June 9, 1987). In February 1988, the Federal Acquisition Regulation (FAR) 
was amended to implement the Prompt Payment Act and OMB Circular A-125 by adding 
FAR Subpart 32.9 and a Prompt Payment clause at FAR 52.232-25. Federal Acquisition 
Regulation; Ratification of Unauthorized Commitments and Prompt Payment, 53 Fed. 
Reg. 3,688 (Feb. 8, 1988). 
3. Concerned that full compliance with the Prompt Payment Act had not been 
achieved and that problems remained, H.R. Rep. No. 100-784, at 9, 12-13 (1988), 
reprinted in 1988 U.S.C.C.A.N. 3036, 3037, 3040-41, Congress enacted the Prompt 
Payment Act Amendments of 1988, Pub. L. No. 100-496, 102 Stat. 2455. As amended 
by the 1988 amendments, 
the Prompt Payment Act provides that, in accordance with 
regulations prescribed by OMB, "the head of an agency acquiring property or service 
from a business concern, who does not pay the concern for each complete delivered item 
of property or service by the required payment date, shall pay an interest penalty to the 
concern on the amount of the payment due." 31 U.S.C. § 3902(a). The interest penalty 
"shall be paid for the period beginning on the day after the required payment date and 
ending on the date on which payment is made" and "such penalty shall be paid without 
regard to whether the business concern has requested payment of such penalty." Id. 
§ 3902(b), (c)(l). The Act requires the head of the agency to pay the interest penalty •·out 
of funds made available to carry out the program for which the penalty is incurred." Id. 
§ 3902(f). 
4. The Prompt Payment Act, as amended by the 1988 amendments, directs the 
Director of OMB to prescribe regulations to implement section 3902 and provides 
3 

detailed instructions regarding the content of the regulations. 31 U.S.C. § 3903. The Act 
requires the OMB regulations to generally provide a required payment date of 30 days 
after receipt of a proper invoice if no other payment date is established by contract, but 
also requires the regulations to prescribe earlier payment dates for payments related to 
certain food and agricultural products. Id. § 3903(a)(l)-(4). The Act also requires that 
the 
OMB regulations "permit an agency to make payment up to 7 days prior to the 
required payment date, or earlier as determined by the agency to be necessary on a 
case-by-case basis." Id. § 3903(a)(8). Lastly, the Prompt Payment Act Amendments of 
1988 require the modification of the FAR to provide appropriate solicitation provisions 
and contract clauses to implement the Prompt Payment Act and OMB's regulations. 
Pub. L. No. 100-496, § 11, 102 Stat. 2455, 2463-65 (codified at 31 U.S.C. § 3903 note). 
5. In 1989, OMB revised Circular A-125 to implement the 1988 amendments to 
the Prompt Payment Act. Revision to Circular No. A-125, "Prompt Payment," 54 Fed. 
Reg. 52,700 (Dec. 21, 1989). The revised Circular A-125 prescribed policies and 
procedures to be used by agencies to comply with the Prompt Payment Act as amended. 
The revised Circular A-125 prescribed rules for determining whether a proper invoice has 
been submitted and 
determining the payment due date, directing agencies to make 
payment no more than 7 days prior to the payment due date unless it determines that 
earlier payment is necessary on a case-by-case basis, and providing guidance for 
calculating interest due on late payments. See id. at 52,706-13. As relevant here, the 
revised Circular A-125 did not include an exception for payments related to military 
contingency operations. 
6. In 1998, OMB issued a proposed rule that would make numerous 
revisions to 
OMB's prompt payment rules and replace OMB Circular A-125 with codified 
regulations. Prompt Payment, 63 Fed. Reg. 33,000 (June 17, 1998). OMB proposed to 
add "one additional exception to the Prompt Payment Act requirements ... for payments 
related to certain specified emergencies and military operations." Id. at 33,001. OMB 
also proposed to add a section that would provide for "early payment for ... payments 
related to emergencies and disasters, as well as for military deployments." Id. 
7. In September 1999, OMB promulgated the final rule codifying its revised 
prompt payment regulations in Part 1315 of Title 5 of the Code of Federal Regulations. 
Prompt Payment, 64 Fed. Reg. 52,580 (Sept. 29, 1999). As revised, OMB's prompt 
payment regulations provide that "[a]ll Executive branch vendor payments and payments 
to those defined as contractors 
or vendors ... are subject to the Prompt Payment Act with 
the following exceptions: ... (2) Payments related to ... military contingency operations 
(as defined in 10 U.S.C. 10l(a)(13))." 5 C.F.R. § 1315.l(b)(2). 2 OMB's regulations also 
provide: 
2 Section 1315 .1 (b )(2) also excepts payments related to emergencies and the release or 
threatened release of hazardous substances from the Prompt Payment Act. 
4 

An agency shall make payments no more than seven days 
prior to the payment due date, but as close to the due date as 
possible unless the agency head or his designee has 
determined, on a case-by-case basis for specific payments, 
that an earlier payment is necessary.. . . An agency may use 
the "accelerated payment methods" in § 1315. 5 when it 
determines that such earlier payment is necessary. 
5 C.F.R. § 1315.40). Section 1315.5, titled "Accelerated payment methods," in tum provides 
at paragraph (c) that "payments made under a military contingency (as defined in 10 U.S.C. 
10l(a)(l3)) may 
be made as soon as the contract, proper invoice, receipt and acceptance 
documents or any other agreement are matched. Vendors shall be entitled to interest penalties 
if invoice payments are made after the payment due date." C.F.R. § 13 l 5.5(c). 
8. In October 1999, Congress amended section 3903 of the Prompt Payment Act 
to provide: 
( c) A contract for the procurement of subsistence items 
that is entered into under the prime vendor program of the 
Defense Logistics Agency may specify for the purposes of 
section 3902 of this title a single required payment date that is 
to be applicable to an invoice for subsistence items furnished 
under the contract when more than one payment due date 
would otherwise be applicable to the invoice under the 
regulations prescribed under paragraphs (2), (3), and (4) of 
subsection (a) or under any other provisions oflaw. The 
required payment date specified in the contract shall be 
consistent with prevailing industry practices for the 
subsistence items, but may not be more than 10 days after the 
date of receipt of the invoice or the certified date of receipt of 
the items. The Director of the Office of Management and 
Budget shall provide in the regulations under subsection (a) 
that when a required payment date is so specified for an 
invoice, no other payment due date applies to the invoice. 
National Defense Authorization Act for Fiscal Year 2000, Pub. L. No. 106-65, § 1009(2), 
113 Stat. 512, 738-39 (1999). 
9. On 22 May 2008, the Inspector General (IG) of the United States Department 
of Defense (DoD) issued Report No. D-2008-098 titled, "Internal Controls Over 
Payments Made in Iraq, Kuwait and Egypt" (app. resp. to gov't mot., ex. K). In this 
report, the DoD IG noted an apparent conflict between 5 C.F.R. §§ 1315.1and1315.5, 
and recommended that the "Under Secretary of Defense for Acquisition, Technology, and 
Logistics update the [FAR] and the Defense Federal Acquisition Regulation Supplement 
5 

[DFARS] to provide guidance that addresses [OMB's] exception to the Prompt Payment 
Act for payments related to military contingency operations" (id. at 22-25). 
10. On 19 August 2009, the Director of Defense Procurement and Acquisition 
Policy issued a class deviation from FAR Subpart 32.9, which implements the Prompt 
Payment Act and OMB's regulations, for all DoD "contracting activities supporting 
payments covered by" 5 C.F.R. § 1315.l(b)(2) (app. resp. to gov't mot., ex. L). The class 
deviation applied when such payments "are either certified for payment in an operational 
area, or are contingent upon the receipt of necessary supporting documentation ... emanating 
from an operational area" (id. at 1 ). The class deviation granted the head of the contracting 
activity the authority to incorporate a special payment clause into contracts when he 
determined that an unstable business environment exists, and directed the head of the 
contracting activity to "make subsequent determinations as the operational area evolves into 
a more stable business environment to enable the provisions of the Prompt Payment Act to 
apply" (id. at 1-2). 
11. In July 2010, citing the 22 May 2008 DoD IG report, the DoD issued an 
interim rule amending the DF ARS to "bring DoD into compliance with OMB 
implementation of the Prompt Payment Act by exempting military contingencies" at 
5 C.F.R. § 1315.l(b)(2). Defense Federal Acquisition Regulation Supplement; Payments 
in Support of Emergencies and Contingency Operations (DF ARS Case 2009-D020), 
75 Fed. Reg. 40,712, 40,712 (July 13, 2010). The interim rule added DFARS 232.901, 
which provides that FAR Subpart 32.9, Prompt Payment, does not apply when (i) there is, 
as relevant here, a contingency operation, (ii) the head of the contracting activity has 
made a determination that conditions exists that limit normal business operations, and 
(iii) payments will be made in the operational area or made contingent upon receiving 
supporting documentation from the operational area. 75 Fed. Reg. 40,713; 
DFARS 232.901(1). The interim rule also added a new DFARS clause, DFARS 
252.232-7011, PAYMENTS IN SUPPORT OF EMERGENCIES AND CONTINGENCY 
OPERATIONS (JUL 2010), which would apply in such situations and does not provide for 
the payment of interest penalties for late payments. 75 Fed. Reg. 40,714. Pursuant to 
DFARS 232.901, however, ifthe head of the contracting activity subsequently 
determines that "the operational area evolves into a more stable environment," the 
contracting officer is required to modify contracts being performed in the operational area 
to "deactivate[] clause 252.232- 7011 and activate[] the applicable FAR Prompt Payment 
clause in the contract." DFARS 232.901(3)(i). In March 2011, DoD adopted 
the interim 
rule as final, with one minor, clarifying change. Defense Federal Acquisition Regulation 
Supplement; Payments in Support of Emergencies and Contingency Operations (DF ARS 
Case 2009-D020). 76 Fed. Reg. 11,371 (Mar. 2, 2011). As will be seen DFARS 232.901 
and the clause at DFARS 252.232-7011 were issued after award of the contracts at issue 
here. 
6 

The Prime Vendor Contracts and Military Operations in Iraq 
12. On 10 May 2002, DSCP issued Solicitation No. SP0300-02-R-4003 (the 4003 
solicitation) to establish indefinite-delivery/indefinite-quantity (IDIQ) contracts for the 
distribution of food and non-food products in three geographic zones under the Prime 
Vendor Program (R4, tab 14 at 1, 7). For Zone III - Middle East, DSCP anticipated 
making two awards, one for Kuwait and Qatar and one for Saudi Arabia (id. at 7). In 
addition to the required delivery locations (id. at 59), the 4003 solicitation advised that 
"the Prime Vendor must have the ability to support an unknown number of troops 
deployed in its respective operational deployment areas," which for Zone III included 
Iraq, upon 30 days notice (id. at 62-63 ). 
13. The 4003 solicitation included FAR 52.212-4, CONTRACT TERMS AND 
CONDITIONS-COMMERCIAL ITEMS (FEB 2002) (R4, tab 14 at 84-87). Paragraph (i) of 
that clause provided: 
Payment shall be made for items accepted by the 
Government that have been delivered to the delivery 
destinations set forth in this contract. The Government will 
make payment in accordance with the Prompt Payment Act 
(31 U.S.C. 3903) and OMB prompt payment regulations at 5 
CFR part 1315. In connection with any discount offered for 
early payment, time shall be computed from the date of the 
invoice. For the purpose of computing the discount earned, 
payment shall be considered to have been made on the date 
which appears on the payment check or the specified date if 
an electronic funds transfer payment is made. 
(Id. at 86) The 4003 solicitation also contained the following regarding payment: 
(Id. at 67) 
B. Payments of delivery orders will be made in 
accordance with the terms and conditions of Paragraph (i) of 
Clause 52.212-4 "Contract Terms and Conditions -
Commercial Items", appearing in the section of this 
solicitation entitled "Contract Clauses". 
C. Payment is currently being made in approximately 
7 days after the receipt of a proper invoice; however, it is still 
subject to the terms and conditions of the Prompt Payment 
Act (31 U.S.C. 3903). 
7 

14. DSCP issued Amendment No. 0002 to the 4003 solicitation on 15 July 2002 
(R4, tab 16). Section II of the amendment consisted of answers to offeror questions, 
which were provided "for clarification purposes only" and 
did "not change the 
solicitation language" (id. at 136). Among the questions and answers provided was the 
following: 
(Id. at 156) 
Question # 94: 
The solicitation states that payments are currently 
being made in 7 days after the receipt of a proper invoice 
(page 67). The solicitation states that these payments are 
subject to the Prompt Payment Act (31 U.S.C. 3903). 
However, the solicitation additionally notes that Fast Payment 
Procedures£31 apply versus the Prompt Payment Act (page 87). 
Please clarify the payment procedures that will apply under 
the contract. 
Answer: The solicitation does not note that Fast Payment 
procedures apply. The Fast Pay block on page #87 is not 
checked, and does not apply. Prime Vendor contracts are 
paid via the Prompt Payment Act, meaning 7 day payment 
terms. 
15. In October 2002, Congress passed the Authorization for Use of Military Force 
Against Iraq Resolution of 2002, Pub. L. No. 107-243, 116 Stat. 1498. Section 3(a) 
authorized the President to "use the Armed Forces of the United States as he determines 
to be necessary and appropriate in order to-- ( 1) defend the national security of the 
United States against the continuing threat posed by Iraq; and (2) enforce all relevant 
United Nations Security Council 
resolutions regarding Iraq." 116 Stat. 1501. On 
19 March 2003, the President directed the United States Armed Forces to commence 
combat operations against Iraq. Letter to Congressional Leaders Reporting on the 
Commencement of Military Operations Against Iraq, 39 WEEKLY COMP. PRES. Doc. 
348, 348 (Mar. 21, 2003). 
3 Section 1315.6 ofOMB's prompt payment regulations, titled "Payment without 
evidence that supplies 
have been received (fast payment)," allows payment to be 
made in limited situations absent evidence of receipt of supplies. 5 C.F .R. 
§ 1315.6; see also FAR Subpart 13.4; FAR 52.213-1. 
8 

16. DSCP awarded Contract No. SP0300-03-D-3061 4 (the PVI contract), 
covering Kuwait and Qatar, to PWC on 28 May 2003 (R4, tab 20). The PVI contract 
expressly incorporated the 4003 solicitation and all five amendments thereto (id. at 2). 
The PV 1 contract also stated the following regarding payment: 
(Id. at 15-16) 
B. Payments of delivery orders will be made in 
accordance with the terms and conditions of Paragraph (i) of 
Clause 52.212-4 "Contract Terms and Conditions -
Commercial Items", appearing in the section of this 
solicitation [sic] entitled "Contract Clauses". 
C. Payment is currently being made in approximately 
7 days after the receipt of a proper invoice; however, it is still 
subject to the terms and conditions of the Prompt Payment 
Act (31 U.S.C. 3903). 
17. On or about 30 June 2003, the parties executed bilateral Modification 
No. POOOO 1 to the PVl contract (R4, tab 21 ). The modification added the "Iraq 
Deployment Zone" to the PVI contract and "establishe[ d] separate ordering and delivery 
requirements for Operation Iraqi Freedom (OIF) initiatives in the country of Iraq area of 
operations" (id. at 2). 
18. On or about 9 July 2003, the parties executed bilateral Modification 
No. P00002 to the PVI contract, which "establishe[ d] the mutually agreed upon pricing 
structure for 1) the Iraq Deployment Zone ... , and 2) distribution costs to deliver 
Government Furnished Material (GFM) of various food types" (R4, tab 22). Neither 
Modification No. POOOO 1 nor Modification No. P00002 exempted payments related to 
military contingency operations from the PVl contract's payment terms. 
19. On 20 August 2004, the parties executed bilateral Modification No. P00025 
to the PVl contract, which added the clause at FAR 52.213-1, FAST PAYMENT 
PROCEDURE (FEB 1998), to the contract (R4, tab 27). According to the modification, the 
Fast Payment Procedure clause was added pursuant to a 12 July 2004 FAR Deviation 
which authorized the use of"Fast Payment procedures for OCONUS Subsistence Awards 
in Support of Contingency Operations" (id. at 1). Under the terms of the modification, 
4 On 4 November 2004, the contracting officer issued unilateral Modification No. P00030, 
changing the contract number of the PVl contract from SP0300-03-D-3061 to 
SPM300-04-D-3061 (R4, tab 28). The contracting officer issued unilateral 
Modification No. P00033 on 1 December 2004, correcting Modification No. P00030 
and changing the contract number of the PVl contract to SPM300-05-D-3061 (Bd. 
corr., joint filing dtd. 22 July 2015). 
9 

fast payment procedures were applicable to invoices "for a delivery into the Iraq 
deployment zone that does not exceed $500,000.00," and did not apply to invoices for 
deliveries to Kuwait and Qatar (id. at 3). 
20. DSCP issued Solicitation No. SPM300-04-R-0323 (the 0323 solicitation) on 
3 September 2004 (R4, tab 36). The 0323 solicitation sought to establish IDIQ contracts 
for the distribution of food and non-food products for five Middle Eastern geographic 
zones under the Prime Vendor Program. Zone 1 encompassed Kuwait, Iraq, and Jordan. 
The 0323 solicitation advised offerors that "[a]ll zones to be supported under this 
solicitation have been designated as contingency operations" as defined in FAR 2.101. 
(Id. at 10) 
21. The 0323 solicitation included FAR 52.212-4, CONTRACT TERMS AND 
CONDITIONS-COMMERCIAL ITEMS (OCT 2003) (R4, tab 36 at 250-55). Paragraph (i)(2) 
of that clause stated that the "Government will make payment in accordance with the 
Prompt Payment Act (31 U.S.C. 3903) and prompt payment regulations at 5 CFR 1315" 
(id. at 252). The 0323 solicitation also contained the following regarding payment: 
(Id. at 79) 
B. Payments of delivery orders will be made in 
accordance with the terms and conditions of Paragraph (i) of 
Clause 52.212-4 "Contract Terms and Conditions -
Commercial Items", appearing in the section of this 
solicitation entitled "Contract Clauses". 
C. Payment is currently being made in approximately 
7 days after the receipt of a proper invoice; however, it is still 
subject to the terms and conditions of the Prompt Payment 
Act (31 U.S.C. 3903). 
22. On or about 17 February 2005, the parties entered into Contract 
No. SPM300-05-D-3 l 
l 9 (the PV Bridge contract), with a term from 16 February 2005 
until 15 December 2005, by executing Modification No. P00036 to the PVl contract (R4, 
tab 30). The PV Bridge contract incorporated the terms and conditions of the PVl 
contract (id.). 
23. Pursuant to the 0323 solicitation, DSCP awarded Contract No. SPM300-05-D-3128 
(the PV2 contract) for Zone 1 (Iraq, Kuwait, and Jordan) to PWC on 7 July 2005 (R4, tab 41 ). 
The PV2 contract expressly incorporated the 0323 solicitation (id. at 2). 
24. By letter dated 28 November 2011, PWC submitted a certified claim seeking 
$5,381,777.62 in late payment interest penalties allegedly due pursuant to the Prompt 
Payment Act and the terms of the PVl, PV Bridge, and PV2 contracts (R4, tab 1). PWC 
10 

attached to its claim two spreadsheets, totaling over 400 pages, detailing the interest 
penalties alleged due (app. supp. R4, tab 49). Although dated 28 November 2011, the 
parties do not dispute that PWC submitted its claim on 5 December 2011 (gov't mot. at 9, 
~ 21; app. resp. to gov't mot. at 17, ~ 21). 
25. By letter dated 26 February 2013, following multiple communications between 
the parties, PWC revised its claim downward to $4,605,594.53 (R4, tab 7 at 1-4). 
26. The contracting officer issued a 1 November 2013 final decision denying 
PWC's claim in its entirety (R4, tab 13). PWC appealed the denial of its claim to this 
Board by letter dated 19 November 2013. 
DECISION 
Having already denied the government's partial motion to dismiss on jurisdictional 
grounds, we are left 
with two pending arguments. First, the government argues that it is 
entitled to summary judgment because 5 C.F.R. § 1315.l(b)(2) precludes PWC from 
recovering Prompt Payment Act interest. Second, the government argues that it is 
entitled to partial summary judgment as to a portion of PWC's claim that it contends is 
barred pursuant to 41 U.S.C. § 7103(a)(4)(A) as untimely submitted. 
Summary judgment is properly granted where there are no genuine issues of 
material fact and the moving party is entitled to judgment as a matter of law. Mingus 
Constructors, Inc. v. United States, 812 F.2d 1387, 1390 (Fed. Cir. 1987). The 
government, as the moving party, bears the burden of proving the absence of a genuine 
issue of material fact and all significant doubt over factual issues is resolved in 
appellant's favor. Colorado River Materials, Inc. d/b/a/ NAC Constr., ASBCA 
No. 57751, 13 BCA ~ 35,233 at 172,991. The Board's task is not to weigh evidence and 
resolve factual issues, but to determine whether triable issues of fact exist. US. Coating 
Specialties & Supplies, LLC, ASBCA No. 58245, 15-1BCA~35,957 at 175,707. 
The Military Contingency Operation Exception 
The parties' primary dispute concerns the proper interpretation of 5 C.F.R. 
§ 1315. l(b )(2).5 Section 1315. l(b )(2) provides, as relevant here, that "[a]ll Executive 
5 PWC states that the Prompt Payment Act "itself has never included an exception for 
payments related to military contingency operations," that "it is uncertain what 
authority OMB relied upon in creating the exception," and that "there is no 
indication in the regulatory history of the source or rationale for OMB's military 
contingency exception" (app. resp. to gov't mot. at 50; app. surreply to gov't reply 
to app. resp. to gov't mot. at 10). PWC does not, however, argue that 5 C.F.R. 
§ 1315.l(b)(2) is not entitled to deference under Chevron, US.A., Inc. v. Natural 
Resource Defense Council, Inc., 467 U.S. 837 (1984), and its progeny. 
11 

branch vendor payments and payments to those defined as contractors or vendors ... are 
subject to the Prompt Payment Act with the following exceptions: ... (2) Payments 
related to ... military contingency operations (as defined in 10 U.S.C. 101 (a)(l3))." The 
government interprets 5 C.F.R. § 1315.l(b)(2) as prohibiting the application of the 
Prompt Payment Act to payments related to military contingency operations (see gov't 
reply to app. resp. to gov't mot. at 4 ). Relying on the 22 May 2008 DoD IG report (SOF 
~ 9), PWC contends that the government's interpretation creates a conflict between 
5 C.F.R. §§ 1315.l(b)(2) and 1315.5(c) (app. resp. to gov't mot. at 51-52). Under PWC's 
interpretation, although the Prompt Payment Act may not apply of its own force to 
payments related to military contingency operations pursuant to 5 C.F.R. § 1315. l(b)(2), 
section 1315 .1 (b )(2) does not deprive an agency of the discretion to nonetheless 
contractually agree to make such payments in accordance with the terms of the Prompt 
Payment Act (id. at 46-4 7, 50). PWC maintains that DSCP exercised such discretion 
with respect to the three Prime Vendor contracts at issue by incorporating contract 
clauses stating that payment would be made in accordance with the Prompt Payment Act 
and its implementing regulations (id. at 42-45). 
We construe a regulation using the same interpretive rules used in construing a 
statute. Lengerich v. Dep 't of Interior, 454 F.3d 1367, 1370 (Fed. Cir. 2006); Tesoro 
Hawaii Corp. v. United States, 405 F.3d 1339, 1346 (Fed. Cir. 2005). We must read the 
disputed provision "in the context of the entire regulation as well as other related 
regulatory sections." Vazquez-Claudio v. Shinseki, 713 F.3d 112, 115 (Fed. Cir. 2013); 
see also Mass. Mut. Life Ins. Co. v. United States, 782 F.3d 1354, 1365 (Fed. Cir. 2015) 
(noting that 
in construing a regulation a tribunal considers "the text of the regulation as a 
whole, reconciling the section in question with sections related to it"). A regulation, like 
a statute, should be construed so that "no clause, sentence, or word shall be superfluous, 
void, or insignificant." Raytheon Co., ASBCA No. 54907, 11-2 BCA ~ 34,870 at 
171,519 (quoting TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001)) (internal quotation marks 
omitted); see also Princess Cruises, Inc. v. United States, 201F.3d1352, 1362 (Fed. Cir. 
2000) ("It is a long-held tenet of statutory interpretation that one section of a law should 
not be interpreted so as to render another section meaningless."). 
The government's interpretation of 5 C.F .R. § 1315. l(b )(2) as prohibiting the 
application of the Prompt Payment Act to payments related to military contingency 
operations is perhaps a permissible reading of section 1315 .1 (b )(2) itself. However, we 
agree with PWC that the government's interpretation runs headlong into 5 C.F.R. 
§ 1315.5(c). Section 1315.5(c), which allows accelerated payment methods for payments 
made under a military contingency, states that vendors "shall be entitled to interest 
penalties if invoice payments are made after the payment due date." Section 1315.5(c), 
promulgated simultaneously with section 1315.l(b)(2) (SOF ~~ 6-7), thus anticipates 
some application of the terms of the Prompt Payment Act to payments related to military 
contingency operations. In promulgating 5 C.F.R. § 1315.5(c), OMB noted that the 
accelerated payment methods provided in that section, to be used when an agency 
determines that early payment in necessary in accordance with 5 
C .F .R. § 1315 .4(j ), 
12 

implement§ 3903(a)(8) of the Prompt Payment Act. Prompt Payment, 64 Fed. Reg. 
52,580, 52,582-83 (Sept. 29, 1999). Therefore, if we interpret 5 C.F.R. § 1315. l(b )(2) as 
prohibiting any application of the Prompt Payment Act to payments related to military 
contingency operations, then§ 1315.5(c) ofthe regulations would have no effect. We are 
hard-pressed to conclude that OMB would promulgate a regulation that would be 
meaningless upon promulgation. 
Moreover, the government's interpretation of 5 C .F .R. § 1315 .1 (b )(2) calls into 
question the validity ofDFARS 232.901. 6 DFARS 232.901 was promulgated to 
implement the exception for payments related to military contingencies in 5 C.F .R. 
§ 1315.l(b)(2) (SOF ~ 11). DFARS 232.901(1) provides that FAR Subpart 32.9, which 
was promulgated to implement the Prompt Payment Act and OMB's prompt payment 
rules (SOF ~ 2), does not apply to military contingencies if two additional criteria are 
met. If those criteria cease to exist, DFARS 232.901(3) calls for the application of the 
standard FAR prompt payment clauses. DFARS 
232.901 does not preclude application 
of the Prompt Payment Act to payments related to military contingencies operations in all 
circumstances. Interpreting 5 C.F.R. § 1315.l(b)(2) as prohibiting any application of the 
Prompt Payment Act to payments related to military contingency operations thus creates 
a conflict between that section and DFARS 
232.901. PWC's construction, which avoids 
this conflict and allows for a more concordant regulatory scheme, is therefore the better 
interpretation of5 C.F.R. § 1315.l(b)(2). See Kearfott Guidance & Navigation Corp. v. 
Rumsfeld, 320 F.3d 1369, 1377 (Fed. Cir. 2003) (noting the canon of construction that 
there is a presumption in favor of finding harmony between two regulations dealing with 
similar subjects); Rice v. Martin Marietta Corp., 13 F.3d 1563, 1568 (Fed. Cir. 1993) 
(same). Accordingly, we hold that 5 C.F.R. § 1315.l(b)(2) does not preclude an agency 
from contractually agreeing to make payments related to military contingency operations 
pursuant to the terms of the Prompt Payment Act. 
All three contracts at issue in this appeal included clauses stating that payment 
would be made in accordance with the terms of the Prompt Payment Act. The PV 1 
contract expressly stated that payment was "subject to the terms and conditions of the 
Prompt Payment Act" (SOF ~ 16). The PVl contract also incorporated the 4003 
solicitation, which included FAR 52.212-4, CONTRACT TERMS AND CONDITIONS -
COMMERCIAL ITEMS (FEB 2002). That clause similarly provided that the government 
would make payment in accordance with the Prompt Payment Act and OMB' s prompt 
payment regulations. (SOF ~~ 13, 16) In modifying the PVl contract to include 
6 We agree with the government that DFARS 232.901 and the accompanying clause at 
DF ARS 252.232- 7011 do not apply to the contracts in dispute because the 
regulations were issued after contract award. See Tech. for Commc 'ns Int' l, ASBCA 
Nos. 36265, 36841, 93-3 BCA ~ 26,139 at 129,947 (applying the prompt payment 
regulations in effect at the time of contract award). However, PWC does not argue 
that these DF ARS provisions are applicable to its contracts; PWC simply cites these 
provisions to support its interpretation of5 C.F.R. § 1315.l(b)(2). 
13 

deliveries to locations in Iraq, the parties did not exempt payments related to military 
contingency operations from these payment provisions (SOF if 18). The PV Bridge 
contract incorporated the terms and conditions of the PVI contract (SOF if 22). The PV2 
contract incorporated the 0323 solicitation. Although that solicitation advised that all 
zones were designated as contingency operations, it included FAR 52.212-4, CONTRACT 
TERMS AND CONDITIONS - COMMERCIAL ITEMS (OCT 2003 ), which stated that payments 
would be made in accordance with the Prompt Payment Act and OMB's prompt payment 
regulations. (SOF iii! 20-21, 23) Because the government contractually agreed to make 
payments under all three contracts in accordance with the terms and conditions of the 
Prompt Payment Act without exception, 5 C.F.R. § 1315.l(b)(2) does not bar any portion 
of PW C's claim. 
Statute of Limitations 
The CDA requires that "each claim by a contractor against the Federal 
Government relating to a contract. .. shall be submitted within 6 years after the accrual of 
the claim." 41 U.S.C. § 7103(a)(4)(A). A claim accrues "when all events, that fix the 
alleged liability of either the Government or the contractor and permit assertion of the 
claim, were known or should have been known." FAR 33.201. A party's failure to 
submit a claim within six years of accrual is an affirmative defense to the claim. Kellogg 
Brown & Root Servs., Inc., ASBCA No. 58175, 15-1 BCA if 35,988 at 175,825; see also 
Do-Well Mach. Shop, Inc. v. United States, 870 F.2d 637, 639 (Fed. Cir. 1989) ("The 
reason that the time bar was fatal is that it constituted a valid affirmative defense."). As 
the proponent of its affirmative defense, the government bears the burden of proving that 
PWC's claim was untimely. Kellogg Brown & Root, 15-1BCAif35,988 at 175,825; 
Lockheed Martin Corp., ASBCA No. 57525, 12-1 BCA if 35,017 at 172,065; see also 
Brunswick Bank & Trust Co. v. United States, 707 F.2d 1355, 1360 (Fed. Cir. 1983) 
(party raising an affirmative defense normally bears the burden of proof). 
The parties do not dispute that PWC submitted its claim on 5 December 2011 
(SOF if 24). To be untimely, PWC's claim must have accrued prior to 5 December 2005. 
The government seeks partial summary judgment, arguing that a portion of PW C's claim 
accrued more than six years prior to submittal. Specifically, the government argues that 
the events that fix liability for late payment interest penalties occur, and a claim for the 
interest penalties accrues, once the government fails to make timely payment on an 
invoice, that is the day after the payment due date. The government thus argues that 
PW C's claim with respect to an unspecified number of invoices, those where the 
government's alleged failure to make timely payment occurred prior to 5 December 
2005, is barred by the CDA's six-year statute of limitations. (Gov't mot. at 19-20) We 
deny the government summary judgment for two reasons. 
First, the government conflates two separate obligations-the obligation to make 
timely payment on an invoice and the obligation to pay an interest penalty for late 
payments. For claim accrual purposes, in determining when the alleged liability is fixed, 
14 

we begin by examining the legal basis of the claim. Gray Personnel, Inc., ASBCA 
No. 54652, 06-2 BCA ii 33,378 at 165,475. The Prompt Payment Act, the provisions of 
which we have found to be applicable to the three contracts at issue, imposes an 
obligation on a government agency to pay an interest penalty when it fails to make a 
payment by the required payment date. 31 U .S.C. § 3902(a). That interest penalty is 
calculated for the period from the day after the required payment date to the date of actual 
payment, and is to be paid without regard to whether such an interest penalty was 
requested. 31 U.S.C. § 3902(b)-(c)(l). The Prompt Payment Act provides that a ''claim 
for an interest penalty not paid" may be filed under the CDA. 31 U.S.C. § 3907(a) 
(emphasis added). Reading these sections together, 
we conclude that the government has 
an obligation to pay the interest penalty for late payments automatically and that the 
government breaches this obligation by failing to pay the interest penalty upon paying the 
underlying invoice, thus creating a claim for the interest penalty not paid. Our conclusion 
is bolstered by 31 U.S.C. § 3902(c)(3) which provides for an additional interest penalty if 
the government fails to pay the interest penalty due within 10 days of the underlying 
payment and the contractor makes a written demand for the interest penalty due within 
40 days of such payment. Moreover, our conclusion is consistent with the Prompt 
Payment Act's legislative history. The House Report accompanying the Prompt Payment 
Act states that if "a Federal agency owes an interest penalty ... , and then fails to pay that 
interest penalty, the business concern to which the penalty is owed may file a claim for 
the amount of interest due under the Contract Disputes Act of 1978." H.R. Rep. 
No. 97-461, at 15 (1982), reprinted in 1982 U.S.C.C.A.N. 111, 125. Accordingly, the 
events that fix the government's alleged liability and allow a claim for interest penalties 
to be asserted do not occur until the government pays the underlying invoice without 
paying the interest penalty due. 
Second, the government has failed to establish the absence of a material dispute of 
genuine fact with regard to the statute of limitations question. Because interest penalties are 
tied to specific payments, claim accrual must be determined on an invoice-by-invoice basis. 
In its motion, however, the government does not present specific facts regarding the 
invoices for which it seeks summary judgment. Rather the government argues in general 
terms. The government fails to establish the facts regarding the date of the specific invoices 
for which it seeks summary judgment, the amount of such invoices, or the date such 
invoices were paid, precluding an assessment of when the government's alleged liability 
with regard to any particular invoice was fixed. Moreover, the government fails to 
introduce any facts regarding the potential applicability of31 U.S.C. § 3903(a)(2)-(4) 
(earlier payment dates for certain food and agricultural products) (SOF ii 4) or§ 3903(c), 
which applies specifically to DLA's Prime Vendor Program (SOF ii 8). The failure to 
introduce invoice-specific facts also precludes application of the "should have known test" 
for claim accrual, which includes a reasonableness component that turns upon what facts 
were reasonably known to the claimant. See The Ryan Co., ASBCA No. 58137, 15-1 BCA 
ii 35,998 at 175,862 (citing Laguna Constr. Co., ASBCA No. 58569, 14-1BCAii35,618 at 
174,459). Accordingly, summary judgment on the government's affirmative defense that 
the CD A's six-year statute of limitations bars a portion of PWC's claim is inappropriate. 
15 

CONCLUSION 
The government's partial motion to dismiss for lack of subject matter jurisdiction 
and the government's motion for summary judgment are denied. 
Dated: 2 May 2016 
I concur 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
dministrative 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 No. 59020, Appeal of Public 
Warehousing Company, K.S.C., rendered in conformance with the Board's Charter. 
Dated: 
16 
JEFFREY D. GARDIN 
Recorder, Armed Services 
Board of Contract Appeals