DENIED: March 31, 2021
CBCA 6772
MICROTECHNOLOGIES LLC dba MICROTECH,
Appellant,
v.
DEPARTMENT OF JUSTICE,
Respondent.
Joseph J. Petrillo and Karen D. Powell of Smith Pachter McWhorter, PLC, Tysons
Corner, VA, counsel for Appellant.
Robin M. Fields and Matthew Vince, Office of General Counsel, Executive Office for
United States Attorneys, Department of Justice, Washington, DC, counsel for Respondent.
Before Board Judges GOODMAN, DRUMMOND, and CHADWICK.
GOODMAN, Board Judge.
Appellant, Microtechnologies LLC dba Microtech, has filed this appeal from the
decision of a contracting office of respondent, Department of Justice (DOJ), denying its
claim for termination for convenience costs.  Appellant and respondent have filed motions
for summary judgement.  We grant respondent’s motion, deny appellant’s motion, and deny
the appeal.


CBCA 6772 2
Background 
Appellant holds a multiple-award government-wide acquisition contract (the contract)
for information technology products and services.  On September 25, 2017, respondent
issued a fixed-price delivery order (the order) under the contract, effective September 27,
2017, for a brand name of workstation perpetual software licenses, plus travel and software
maintenance.  The period of performance included one base year (September 29, 2017, to
September 28, 2018) and two potential option years (September 29, 2018, to September 28,
2019; and September 29, 2019, to September 28, 2020).  The cost of software maintenance
during each option year, if exercised, was $688,051.80. 
On September 29, 2017, at the beginning of the base year of performance, appellant
purchased the perpetual software licenses and software maintenance for the base year and
both option years and paid the invoice for this purchase on October 31, 2017. 
 Two days after the base year period of performance ended, on Sunday, September 30,
2018, at approximately 2:30 p.m., appellant’s financial services manager emailed
respondent’s Executive Office for United States Attorneys acquisitions staff, chief of
operations, indicating that she had not heard from the contracting officer’s representative
(COR) regarding the exercise of the first option year.  Later that day, at approximately 6:30
p.m., respondent transmitted via attachment to email a proposed bilateral modification
designated P00002 (modification 2), which stated in part: “To exercise option year 1 for
[brand name] Workstation Perpetual Software License for the period of September 29, 2018,
through September 28, 2019, in the amount of $688,051.80.”  Appellant accepted, signed,
and returned modification 2 the same day at approximately 9:10 p.m.
On Monday, October 1, 2018, at 8:37 a.m., the assistant director of respondent’s
acquisitions staff sent an email to appellant’s financial services manager informing appellant
that the option year had been exercised in error.  Attached to the email was modification
P00003 (modification 3), which read in part as follows: “The purpose of this modification
is to terminate Option Year One.  The option year was exercised in error.”  At 9:09 a.m.,
appellant received an email from respondent requesting signature on a modification
terminating the option year.  Appellant did not sign that modification, and on October 2,
2018, respondent sent appellant a unilateral modification dated October 1, 2018, terminating
the option year, which was signed by the contracting officer.
By letter dated November 29, 2018, appellant informed respondent that the
manufacture of the brand name work stations does not sell software maintenance for less than
a one-year term, and so respondent will be liable, as the result of the termination of the
modification, for the full cost of a one-year maintenance subscription.  Therefore, appellant
suggested that respondent rescind the termination, and requested a response so that it could

CBCA 6772 3
send a termination cost proposal if the termination was not rescinded.  The letter also stated
that the “short form” Termination for Convenience clause referenced in the modification was
not in the order or in the contract; instead, the correct convenience termination clause was
the one for commercial item contracts, Federal Acquisition Regulation (FAR) 52.212-4(l).
By letter dated May 17, 2019, appellant sent respondent a claim for termination costs
in the amount of $688,051.80, which represented the price of one year of software
maintenance in modification 2.  On February 18, 2020, respondent’s contracting officer
transmitted an undated letter denying the claim, stating that appellant had not provided any
data to substantiate that any work was performed between the issuance of the modification
exercising the option year and its termination, nor any data to substantiate that any costs were
incurred between the issuance of the modification and its termination.  Additionally, the
decision stated that confirmation that the option year services would not be required was
provided by telephone to appellant by the COR on Friday, September 28, 2018, and
respondent is not responsible for the reimbursement of costs associated with appellant’s
decision to pre-pay for the three years of software maintenance which it purchased at the
beginning of the contract.
Discussion
Summary judgment is appropriate when no material facts are in dispute and the
moving party is entitled to judgment as a matter of law.  Celotex Corp v. Catrett, 477 U.S.
317, 325 (1986); Harris IT Services Corp. v. Department of Veterans Affairs, CBCA 5814,
et. al., 20-1 BCA ¶ 37,533 (2019).  A material fact is one that will affect the outcome of the
case.  Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Turner Construction Co.
v. Smithsonian Institution, CBCA 2862, et al., 15-1 BCA ¶ 36,139.
Appellant contends in its motion for summary judgment that it is entitled to be paid
the cost of one year of maintenance for the erroneously exercised option year pursuant to the
termination clause of the contract, which reads in relevant part:
the Contractor shall be paid a percentage of the contract price reflecting the
percentage of the work performed prior to the notice of termination, plus
reasonable charges . . . [that] have resulted from termination.
FAR 52.212-4(l).  Appellant alleges that the cost of one year of maintenance for the option
year was a reasonable charge that resulted from the termination of the modification, even
though it purchased the maintenance for the option years at the beginning of the base year,
not knowing whether or not the option year would be exercised, and the modification was
terminated within twelve hours.  Appellant states:

CBCA 6772 4
Since [the manufacturer] sells such maintenance in increments of one year, 
MicroTech was required to purchase a minimum of one year’s worth of
software maintenance in order to fulfill its performance requirements when the
Order was extended.  DOJ complains that MicroTech actually purchased the
software maintenance in advance, but this is irrelevant.  MicroTech was not
only justified in purchasing a year’s software maintenance as of September 30
(the date of the bilateral modification), it was contractually obligated to do so.
The termination for convenience did not occur until a day or two later.  That
the actual purchase occurred earlier than September 30 does not make it
unnecessary or improper.
Appellant’s Motion at 7-8.
Appellant states further:
MicroTech has acted reasonably and responsibly to mitigate its costs.  [The
manufacturer] does not refund software maintenance costs once paid.[1]
Appellant’s Motion at 9 (footnote omitted).
Respondent states in its motion: 
MicroTech is not entitled to termination costs for $688,051.80, the price of
one-year of software maintenance under Option Year 1 of the [order] . . . after
the Government terminated Modification P00002 . . . on October 1, 2018. 
First, MicroTech seeks to recover termination costs relating to its advanced
payment to [the manufacturer] for option years . . . even though no options had
been exercised at the time of MicroTech’s payment to [the manufacturer]. 
Those costs are not recoverable because the Government did not terminate the
Order; it expired by its own terms on September 28, 2018 when the
Government did not exercise Option Year 1.  Indeed, there was no guarantee
that the Government would exercise its options under the contract.  Therefore,
MicroTech can only claim termination costs resulting from the Government’s
termination of Mod[ification] 2, which was a separate agreement the
Government entered into by mistake on September 30, 2018 and subsequently
terminated within 12-hours.
1 The manufacturer’s Support and Maintenance Services Agreement does not
address whether the purchase is refundable.  Appeal File, Exhibit 4 at 6.

CBCA 6772 5
Second, preponderant record evidence shows that MicroTech cannot recover
under the first prong of the commercial items termination for convenience
clause because it did not perform any work during the 12-hours that
Mod[ification] 2 was in effect prior to the Government’s termination for
convenience.  Third, preponderant record evidence further shows that
MicroTech is not entitled to recovery under the second prong of the
commercial items termination for convenience clause because MicroTech’s
decision to prepay [the manufacturer] for a three-year term of software
maintenance was not a reasonable charge resulting from the termination of
Mod[ification] 2 a year later.  And it certainly was not a reasonable charge
resulting from the natural expiration of the underlying Order.
Respondent’s Motion at 4-5 (footnotes omitted).
Thus, appellant maintains that software maintenance costs for which it seeks recovery
as a termination cost was a reasonable charge in connection with the termination of the
modification.2  Respondent emphasizes in its motion for summary judgement that appellant
has offered no evidence that appellant has supplied work under the modification.  Rather,
respondent contends that appellant’s purchase of the software maintenance at the beginning
of the base year, with no assurance that the option years would be exercised, did not result
from the issuance of modification 2, nor had any work been performed in the short period
between the erroneous issuance of modification 2 and the termination for convenience of the
modification.
By pointing out this lack of evidence of work performed, respondent has shifted to
appellant the burden to show that there exist disputed factual issues.3  While the scope of
2 Appellant relies upon Dream Management, Inc. v. Department of Homeland
Security, CBCA 5517, 17-1 BCA ¶ 36,716; ACM Construction & Marine Group, Inc. v.
Department of Transportation, CBCA 2245, et al., 14-1 BCA ¶ 35,537; Rex Systems, Inc.,
ASBCA 59624, 16-1 BCA ¶ 36,350; SWR, Inc., ASBCA 56708, 15-1 BCA ¶ 35,832 (2014);
and Information Systems & Networks Corp., ASBCA 46119, 02-2 BCA ¶ 31,952.  These
decisions do not address the issue of entitlement to termination costs arising from a
termination of an erroneously exercised option period.
3 “[W]hen the non-moving party bears the burden of proof . . . , the moving party
can simply point out the absence of evidence creating a disputed issue of material fact.  The
burden then falls on the non-moving party to produce evidence showing that there is such a
disputed factual issue in the case.”  Simanski v. Secretary of Health & Human Services, 671
F.3d 1368, 1379 (Fed. Cir. 2012).

CBCA 6772 6
modification 2 was the supply of software maintenance for the second option year, appellant
alleges that it purchased non-refundable software maintenance almost a year previously when
it did not know if the maintenance would be required, and that it was contractually obligated
to purchase the maintenance when it received the modification and the purchase was not
refundable.  These are allegations without evidence, which fail to set forth specific facts
showing that there is a genuine issue of material fact, and as such cannot defeat the motion
for summary judgment.  Michael Johnson Logging v. Department of Agriculture, CBCA
5089, 18-1 BCA ¶ 36,938 (2017). 
Appellant fails in its burden of proof, as it rests on allegations that do not offer
specific facts evidencing entitlement to recover the costs at issue or showing genuine issues
of fact.  Appellant does not set forth specific facts that prove that the one year of software
maintenance at issue that was purchased at the beginning of the base year was required under
the contract when purchased.  Appellant further fails to prove its allegation that this purchase
was non-refundable, when the purchase allegedly became non-refundable, or if the alleged
non-refundability was the result of the issuance and termination of modification 2.  There is
no evidence that appellant took action to activate or apply the software maintenance upon
receipt of modification 2, or during the approximately twelve-hour period between the
execution of the modification and notice that the modification was an erroneous exercise of
the option, that would have resulted in appellant supplying the software maintenance to the
Government pursuant to modification 2.  Accordingly, appellant has not proved that the
software maintenance at issue was supplied to the Government under modification 2, and
therefore the cost of that software maintenance is not a cost arising from the termination of
modification 2.
Decision
Respondent’s motion for summary judgement is granted.  Appellant’s motion for
summary judgement is denied.  The appeal is DENIED.
    Allan H. Goodman        
ALLAN H. GOODMAN
Board Judge
We concur:
  Jerome M. Drummond         Kyle Chadwick               
JEROME M. DRUMMOND KYLE E. CHADWICK
Board Judge Board Judge