GRANTED IN PART AS TO ENTITLEMENT: January 23, 2009 
CBCA 1306 
DELTA AIR LINES, INC., 
Appellant, 
v. 
GENERAL SERVICES ADMINISTRATION, 
Respondent. 
David W. Burgett and Edward C. Eich of Hogan & Hartson LLP, Washington, DC, 
counsel for Appellant. 
Aaron Pound, Office of General Counsel, General Services Administration, 
Washington, DC, counsel for Respondent. 
Before Board Judges DANIELS  (Chairman), GILMORE , and STEEL . 
DANIELS , Board Judge. 
Delta Air Lines, Inc. (Delta) claims interest under the Prompt Payment Act, 31 U.S.C. 
§§ 3901-3907 (2006), and the Contract Disputes Act, 41 U.S.C. §§ 610-613, on money paid 
by the General Services Administration (GSA) in 2007 for government travel and 
transportation.   The amount of the claim, as of January 31, 2008, was $898,310.81.   We grant 
the appeal in part as to entitlement.  Because the parties have not yet addressed the amount 
Delta is to be paid, we must defer consideration of that matter. 

      
   
   
  
  
  
  
 
          
 
  
 
   
   
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Background 
The facts relevant to this case have been presented by the parties in the form of a joint 
stipulation.  The following summary of those facts is taken from the stipulation. 
GSA annually solicits, from airlines seeking to provide transportation services to the 
Government, bids for the provision of transportation between specified cities. It then awards 
“city pair” contracts to airlines for services during specified federal fiscal years.  The agency 
awarded to Delta city pair contracts for various federal fiscal years. This appeal involves 
interest on the invoices for travel under government travel requests (GTRs) issued to Delta 
under its 2005, 2006, and 2007 city pair contracts. 
In March 2004, the Government Accountability Office issued a report which 
concluded that the Department of Defense (DoD) had paid several airlines for passenger 
tickets that were not used in 2001 and 2002. GSA subsequently demanded that Delta refund 
alleged overpayments Delta had received; if the airline did not comply, GSA said, the 
Government would deduct the amounts in question from payments due for government 
employee travel tickets purchased later by GTRs.  (When a GTR is used for travel, the 
Government does not make payment for tickets until after travel has occurred.)  Delta entered 
into discussions with GSA and researched tickets that DoD reported as not having been used. 
On September 14, 2005, Delta petitioned for Chapter 11 bankruptcy protection.  Delta 
continued to provide transportation for government employees and cargo while it was in 
bankruptcy. 
Shortly after the filing of the bankruptcy petition, GSA began collecting and 
withholding funds for payment for transportation which occurred after that filing (also called 
“post-petition transportation”).  An auditor contracted by GSA had approved payment of 
these funds, and no agency had disputed the validity of the invoices.  GSA took the position, 
however, that it was entitled to recoup payments for unused tickets purchased in 2001 and 
2002 from amounts owed to Delta for post-petition transportation which had been provided 
pursuant to GTRs. 
On February 7, 2006, Delta requested a declaratory judgment by the United States 
Bankruptcy Court for the Southern District of New York precluding GSA from withholding 
payment for transportation ordered after Delta had filed for bankruptcy.  On November 3, 
2006, the court held that because Delta was operating in bankruptcy, GSA had no authority 
to set off payment for this transportation as a means of collecting amounts which were owed 
prior to the filing of the petition.  In re Delta Air Lines , 359 B.R. 454 (Bankr. S.D.N.Y. 
2006). 

 
  
 
    
    
 
   
  
  
     
    
      
       
    
 
 
    
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The Government appealed the decision on December 5, 2006.  The appeal was 
dismissed by stipulation of the parties on July 27, 2007.  At that time, the bankruptcy court’s 
ruling as to the illegality of withholding payment became final.  
GSA paid Delta the bulk of the principal amount owed under the invoices on March 7, 
2007. It paid Delta the remainder of that amount on August 28, 2007.  Neither of these 
payments included interest. 
On January 31, 2008, Delta filed a certified claim with a GSA contracting officer for 
the total amount of unpaid statutory interest to that date.  On May 8, 2008, the contracting 
officer denied the claim. 
Discussion 
Prompt Payment Act interest 
In 1982, Congress, determined to “provide incentives for the Federal Government to 
pay its bills on time,” H.R. Rep. No. 97-461, at 1, as reprinted in 1982 U.S.C.C.A.N. 111, 
enacted the Prompt Payment Act (PPA), Pub. L. No. 97-177, 96 Stat. 85 (1982).  In its 
present form, the PPA contains the following basic scheme for achieving that objective: 
When a business concern provides a property or service to a government agency, it presents 
an invoice to the agency for payment.  The agency must make payment by the “required 
payment date.”  That date is “30 days after a proper invoice for the amount due is received,” 
unless another date is provided by contract or by statute for the particular kind of property 
or service involved.  31 U.S.C. § 3903(a)(1)-(6). If the agency does not make payment by 
the required payment date, it must pay the contractor not only the principal amount due, but 
also an interest penalty. Interest begins to run on the date after the required payment date; 
it ceases to run when the first of the following events occurs: payment is made, a claim for 
interest is filed under the Contract Disputes Act (CDA), or one year passes from the required 
payment date.  Id.  §§ 3902(a), (b), 3907(b). 
The PPA contains an exception to the requirement for payment of interest on invoices 
not paid by the required payment date.  Interest is not mandated “on a payment that is not 
made because of a dispute between the head of an agency and a business concern over the 
amount of payment or compliance with the contract.”  31 U.S.C. § 3907(c).  
The parties disagree as to whether this exception applied to GSA’s withholding of 
payments on Delta’s invoices under the carrier’s 2005, 2006, and 2007 city pair contracts. 
GSA believes that it was justified in not paying interest while its withholding of payments 
on those invoices was in dispute in bankruptcy court. The agency maintains that if it owes 

   
 
 
  
 
 
      
 
  
     
 
   
 
  
 
   
   
 
  
  
 
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any interest to Delta, the interest should run only for the time between the date on which the 
Government’s appeal of the bankruptcy court decision was dismissed (July 27, 2007) and the 
date on which payment on the invoices was made (August 28, 2007).  Delta contends that the 
PPA precludes the running of interest not when payment is related to any sort of dispute, but 
rather, when there is a dispute related to payment under or compliance with the contract in 
question.  Delta reads the exception in light of a statement in the House of Representatives 
committee report on the 1988 amendments to the Act:  “The act’s protections apply only 
when there is no dispute relating to a contractor’s performance in accordance with the terms 
and conditions of the contract .”  H.R. Rep. No. 100-784, at 11, as reprinted in  1988 
U.S.C.C.A.N. 3036, 3039 (emphasis added). 
We agree with Delta.  The evident meaning of the statute’s exception, particularly in 
light of the legislative history, is that PPA interest fails to run on payment for contracted-for 
property or services only when an agency disputes that the contractor performed the work for 
which it has invoiced or the invoice is otherwise defective.  These are the sole situations in 
which the contractor’s invoice may not be considered “proper” and thus fail to trigger the 
requirement for prompt payment. The Government has never disputed that Delta provided 
the services for which it invoiced, and it has not contended that any of Delta’s invoices was 
defective.  Consequently, on each of the invoices in question, PPA interest began to run 
thirty days after the invoice was received by the Government, and it ran until payment was 
made, the CDA claim was filed, or one year passed after that required payment date, 
whichever came first. 
This result is consistent with the one reached in the only decision cited by either party 
which bears on our situation, In re Frontier Airlines, Inc. , 146 B.R. 574 (D. Colo. 1992).  In 
that case, the district court affirmed the bankruptcy court’s holding that the Government 
owed to an airline operating in bankruptcy interest on amounts which had been improperly 
set off against amounts owed to the airline.  GSA considers Frontier Airlines  inapposite 
because there, the airline sought interest as part of a bankruptcy proceeding, whereas here, 
it seeks interest in a CDA proceeding.  We agree with Delta that the identity of the 
proceeding makes no difference.  Frontier sought and Delta seeks interest under the PPA, 
which runs as a matter of law if certain conditions are present.  Those conditions were 
present in both instances, so the interest should run here as it did there. 
Unlike GSA, we do not find this result inequitable.  The agency withheld from Delta 
for a period of years money which it acknowledged was owed to the airline, but which it 
believed should be set off against money which the airline owed to the Government.  The 
bankruptcy court held that the set-off was improper; the Government had thus improperly 
withheld money which was rightfully Delta’s.  The Government had the use of Delta’s 
money for a period of years, and compensating Delta for that use, by awarding it interest, is 

  
 
   
  
     
   
 
     
 
 
  
        
  
    
    
    
 
  
 
    
 
 
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appropriate.  Had the Government prevailed in the bankruptcy proceeding, interest might 
have run against Delta on the amount it owed to the Government, and if the calculations for 
both principal and interest amounts were identical, the Government would not have owed 
Delta any net interest.  But the Government did not prevail, so interest ran only on the 
amount it improperly withheld. 
Contract Disputes Act interest 
The CDA provides that “[i]nterest on amounts found due contractors on claims shall 
be paid to the contractor from the date the contracting officer receives the claim pursuant to 
section 605(a) of this title [41, United States Code] from the contractor until payment 
thereof.”  41 U.S.C. § 611.  Because we have found that amounts are due Delta, consequent 
to its claim for PPA interest, the airline is clearly entitled to interest under the CDA from the 
date on which the GSA contracting officer received the airline’s January 31, 2008, certified 
claim until the date of payment. Delta maintains that it is additionally entitled to interest 
under the CDA from the date on which PPA interest ceased to run until the date on which the 
contracting officer received the certified claim. 
This portion of Delta’s argument is inconsistent with the requirements of the CDA, 
as understood by the Court of Appeals for the Federal Circuit.  The provision of the CDA 
relating to interest references receipt of a claim by a contracting officer.  It is consonant with 
the fundamental provision of the Act which states, “All claims by a contractor against the 
government relating to a contract shall be in writing and shall be submitted to the contracting 
officer for a decision.” 41 U.S.C. § 605(a).  The Court of Appeals has explained, “Under the 
CDA, a final decision by the contracting officer on a claim . . . is a ‘jurisdictional 
prerequisite’ to further legal action thereon.”  Sharman Co. v. United States , 2 F.3d 1564, 
1569 (Fed. Cir. 1993) (cited approvingly in Reflectone, Inc. v. Dalton, 60 F.3d 1572, 1575 
(Fed. Cir. 1995) (en banc)).  It is true, as Delta notes, that the Court has held that there is “no 
requirement in the [CDA] that a ‘claim’ must be submitted in any particular form or use any 
particular wording.”  Contract Cleaning Maintenance, Inc. v. United States , 811 F.2d 586, 
592 (Fed. Cir. 1987). Immediately following that sentence, however, the Court continued, 
“All that is required is that the contractor submit in writing to the contracting officer  a clear 
and unequivocal statement that gives the contracting officer  adequate notice of the basis and 
amount of the claim.”  Id. (emphasis added). 
Until Delta submitted its certified claim on January 31, 2008, the airline had neither 
submitted a claim to a contracting officer nor received a decision from such an official.  It 
may be true, as Delta argues, that in the context of its disputes with the Government as to 
rights and obligations as affected by the airline’s bankruptcy petition, Delta made GSA as 
well as Department of Justice attorneys cognizant of its demands for interest.  But even if 

 
      
 
 
   
  
 
 
  
 
  
 
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6 CBCA 1306 
these discussions might possibly be construed to have made those demands into “claims,” as 
that term is used in the CDA, it certainly does not evince any submission to a contracting 
officer.  As the Court has held in other circumstances, contracting officers are “a limited 
class of government employees” with specialized authority, and that authority cannot be 
implicitly conveyed to or assumed by others.  See Winter v. Cath-dr/Balti Joint Venture , 497 
F.3d 1339, 1341, 1344 (Fed. Cir. 2007); City of El Centro v. United States , 922 F.2d 816, 
820-21 (Fed. Cir. 1990).
1   We consequently conclude that Delta is not entitled to CDA 
interest, on amounts improperly withheld, for any period of time prior to the contracting 
officer’s receipt of the January 31, 2008, claim. 
Decision 
We consequently GRANT  the appeal IN PART AS TO ENTITLEMENT .  Delta 
is entitled to be paid interest as calculated under the Prompt Payment Act on each invoice in 
question from the thirty-first day after that invoice was received until the first of the 
following events occurred: payment was made, Delta’s January 31, 2008, claim for interest 
was filed under the Contract Disputes Act, or one year passed from the date on which interest 
began to run.  Delta is also entitled to be paid interest as calculated under the Contract 
Disputes Act from the date on which the contracting officer received Delta’s January 31, 
2008, claim until the date of payment.  Delta is not entitled to be paid any additional Contract 
Disputes Act interest. 
The Board urges the parties to attempt to apply the holdings of this decision to the 
calculations of the amount due Delta under its claim.  The parties shall file with the Board, 
within thirty days of the date of the decision, a report on the status of their efforts. 
STEPHEN M. DANIELS 
Board Judge 
1 We recognize that the district court in Frontier Airlines , 146 B.R. at 579,  came 
to a contrary conclusion.  We respectfully believe that the court’s ruling was wrong in  this 
regard. 

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7 CBCA 1306 
We concur: 
BERYL S. GILMORE CANDIDA S. STEEL 
Board Judge Board Judge