ARMED SERVICES BOARD OF CONTRACTAPPEALS Appeal of

-- USAC Aerospace Group Inc. dba USAC

Aerospace Group: Aerostructures Under ContractNo. SPM4A6-10-D-0188 APPEARANCE FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ) ) ) ASBCA No. 59114 ) ) ) Mr. Michael Sammon President Daniel K. Poling, Esq.

DLA ChiefTrial Attorney Jason D. Morgan, Esq. Edward R. Murray, Esq.

Trial Attorneys DLA Aviation Richmond, VA OPINION BYADMINISTRATIVEJUDGE PAGE ON THE GOVERNMENT'S SECOND MOTION TO DISMISS AND THE BOARD'S ORDERFOR SUPPLEMENTAL BRIEFING The Defense Logistics Agency, Aviation Supply Chain (DLA or the government) moves for the second timeto dismiss ASBCA No. 59114 for lack of jurisdiction (gov't 2nd mot.). 

### It reasons thatthis appeal, which arose from Delivery OrderNo. 0001 (DO 1), cannot be maintained following the Board's dismissal of ASBCA No. 59115 as untimely. 1 The latter appeal concerned the termination for default ofContractNo. SPM4A6-10-D-0188 between DLA and USAC Aerospace Group: Aeronautical Flight Center (USAC, appellant orthe contractor). This is the contract underwhich DO 1was issued. In accordance with Board Rule 7 Motions, 

## ii 7(b) Jurisdictional Motions, the Board on 5 May 2015 ordered the parties to address the continued corporate capacity

1On 4 December 2014, the Board denied the government's first motion to dismiss (gov't ptmot.) ASBCA No. 59114 for untimeliness, and granted that motion in regard to the remaining appeals that were also the subject ofthat motion. See USACAerospace GroupInc. dba USACAerospace Group:Aerostructures, ASBCA No. 59114 etal., 15-1 BCA

## ii 35,834; familiarity with that decision is presumed.ofUSAC, and its representative, to bring andprosecute this appeal underBoard Rule 15 Representation.2
STATEMENT OF FACTS FORPURPOSES OF THE GOVERNMENT'S SECOND MOTION TO DISMISS The Contract and Terminationfor Default On 3 May 2010, DLA awarded indefinite-delivery/indefinite-quantity (IDIQ) ContractNo. SPM4A6-10-D-0188 to USAC (R4, tab 1). The name and address ofthe company are listed in the contract as USAC Aerospace Group, Aeronautical Flight Center: Hangar, Murrieta CA 92563-2573 andthe contractor's CAGE (Commercial and GovernmentEntity) code is given as 5RUB5 (id. at 1).3 Although USAC represented itselfas a corporation in entering into the contract (R4, tab 1 at 1 ), the record does notreflectthat USAC evernotified the government that it had forfeited this status. Nor does the record indicate that USAC sought a novation for government approval to assume the contract in a non-corporate capacity. The IDIQ contract, which had a base and four optional years, called for the contractorto provide holdback latches. The contract called for the governmentto order a minimum of 163 and a maximum of 1,301 latches atthe price of$44.50 each. The contractorwas required to conduct a first article test (FAT) and submit a FAT report in 90 days. (R4, tab 1)

2 The Board's inquiry in ASBCANo. 59114 was promptedby documentsprovided in support ofthe government's motion to dismiss inASBCANo. 59186 (gov't mot. in No. 59186) for want ofUSAC's corporate capacity. Although ASBCA No. 59114 arises under a separate contract, both contracts werebetweenDLA and USAC and overlapped in time. The government's motion in No. 59186 raisedjurisdictional questions in No. 59114. Appellantwas notified on 23 February 2017 that unless it provided_timely and crediblerebuttal, the Board would considerrelevantportions ofthe record from No. 59186 in the instant appeal. Appellant did not respond to this order; accordingly, we considerthe record from ASBCANo. 59186 in evaluating ourjurisdiction overASBCA No. 59114. 3 We note thatUSAC used different CAGE codes in the contracts underlying Nos. 59114 and 59186. From appellant's correspondence, we understand these to betwo different divisions underthe same corporate aegis. As appellantdid not distinguish betweenthese as separate entities, wetreat "USAC"as a single business for purposes ofthis decision.

2

### Also on 3 May 2010, DLA issued DO 1under the contract for a total of 1,082 latches at $44.50 each (R4, tab 6). Priorto terminating the contract for default, DLA issued several unilateral modifications pertaining to DO 1(R4, tabs 7-10). On 10 May 2010, contract Modification No. 000101 "incorporate[d] the First Article Test information" (R4, tab 7). On 10 December 2010, contract Modification No. 000102 identified an alternate material and revised the delivery schedule (R4, tab 8). Contract Modification No. 000103 dated 20 January 2011 revised the delivery schedule and set a schedule for first article testing, with the FAT and report due 18 April 2011 (R4, tab 9). A modification of 12 April 2013 extended the delivery dates for CLINs 0001-0003 (R4, tab 10). On 30 July 2013, the contracting officer (CO) issued a "SHOW CAUSE NOTICE"to the contractor, advising that "the Government is considering terminating your contract for default." DLA advised that USAC had "neither delivered the required supplies nor [had it] 

### requested a new delivery date." The contractor was given "10 days after yourreceipt ofthis notice" to respond. (R4, tab 30) USAC replied to the Show Cause Notice on 2 August 2013. 

### It attributed performance deficiencies to its supplier Robinson Manufacturing for providing a nonconforming casting. USAC asked for an additional payment of$1,500 and an extension of60-90 days to correct the failure. (R4, tab 31) The CO on 19 September 2013 notified USAC that the instant contract was terminated for default (R4, tab 33). The CO on 20 September2013 issued contract Modification No. POOlOl, a separate notice oftermination for default ofCLINs 0001 and 0002 (DO 1 ). The address listed for USAC in this modification was "1174 East Edna Plc, Covina CA 91724-2507 USA." (R4, tab 5) USAC'sAppeal inASBCA No. 59114 of the Government's Termination/orDefault of DOI 

### On 3January 2014, the ASBCA received USAC's appeal from the CO's decision to terminate the contract for default. Attached to that notice was a copy ofthe CO's separately issued contract modification thatterminated DO 1. The Board docketed this appeal as ASBCANo. 59114. USAC's correspondence of3 March 2014 was signed by Michael Sammon as "President/Director ofOperations." This letter confirmed that he was the "Company Official qualified" under Board Rule 26.4 

### Appellant said that it would advise the Board ifit retained legal representation, but has not done so.

4 

### This rule has beenrenumbered as Board Rule 15 Representation.

3The Government's SecondMotion to Dismiss inASBCA No. 59114 andAppellant's Opposition to the Motion The government on 4 February 2015 filed its second motion to dismiss in ASBCA No. 59114. 

### It noted thatthe Board's ruling of4 December 2014 dismissed as untimely ASBCA No. 59115, which arose from USAC's challenge to termination ofthe underlying contract. The government reasoned that "DLAterminated for default all of the delivery orders-includingDelivery Order 0001, the subject of[ASBCA No. 59114]

- when itterminated for default USAC's IDIQ contract." (Gov't 2nd mot. at 7) The Board on 23 February 2015 ordered appellant to submit its opposition to the government's second motion to dismiss by 10 April 2015. The order allowed the government the option ofreplying by 11 May 2015, and gave appellantthe opportunity to submit a final response by 11 June 2015. USAC characterized its 10 April 2015 submission as its "oppositionto the government's [second motion to] dismiss." The contractor's correspondence did not address the consequences oftheBoard's dismissal ofASBCANo. 59115. The Board's Order for SupplementalBriefing In considering the government's second motion to dismiss, the Board'sreview ofthe overall record raised other concerns. This included unrebutted information submitted as part ofa government motion in ASBCA No. 59186. Documentation provided by the government from the California andNevada secretaries ofstate brought into question the corporate viability ofUSAC, and to Mr. Sammon's representative capacity, at all times relevantto making and sustaining bothASBCA Nos. 59114 and 59186. As provided in BoardRule 7 Motions, 

### ii (b) Jurisdictional Motions, the ASBCA on 5 May 2015 issued suasponte an Order for Supplemental Briefing on the issues of USAC's continued corporate capacity and Mr. Sammon's compliance with Board Rule 15 Representation. Theparties were ordered to address "whether (1) USAC possessed sufficient corporate capacity, and (2) Michael Sammon's adequate legal authority, to bring and prosecute this appeal." The order directed the parties' attention to its decision in "Easterbrook/Ramco, ASBCANo. 42176 [et al.], 94-2 BCA

### ii 26,658 and [to] Nevada Revised Statutes (NRS) 

### § 78.175 DEFAULTING CORPORATIONS: DUTIES OF SECRETARY OF STATE; REVOCATION OF CHARTERAND FORFEITURE OF RIGHTTO TRANSACTBUSINESS; DISTRIBUTION OF ASSET[S], includingNRS 78.175(2)." Theparties were told to "exchange with one another, and submitto the Board, a supplemental briefpertaining to the Board'sjurisdiction over [ASBCANo. 59114] that addresses the questions framed" in the order. This ordercautioned USAC that its



### 4

### failure to provide responsive answers to the questions posed therein wouldresult in the Board's drawing an adverse inference regarding the requisite status ofeach and the serious consequences thereof: If

### it is USAC's position that both USAC and Michael Sammon were duly authorized to bring and prosecute this appeal, it is required to furnish prooffor these contentions. Failure to do so in either instance will result in the Board's drawing adverse inferences and dismissal ofthis appeal for want ofjurisdiction. USAC's letter of 11 June 2015 did not address the Board's inquiry; rather, it further asserted the merits ofits appeal. DECISION Despite repeated opportunities, USAC failed to provide any evidence that Mr. Sammonwas an authorized representative as required by Board Rule 15. Having warned USAC ofthe consequences offailing to furnish credible evidence, the Board draws the following adverse inference. We find that USAC purportedly entered into the subject contract as a corporation but failed to furnish proofthat Michael Sammon is a qualified corporate representative, to bring and maintain this appeal. This conclusion is based upon appellant's failure to rebut evidence submitted in ASBCANos. 59114 and 59186. USAC failed to comport, as it must, with Board Rule 15 Representation. See, e.g., Smart Construction & 

### Engineering Co., ASBCA No. 59354,**15-1BCA~36,018.** 

### It is unnecessary that we considerthe government's second motion to dismiss. CONCLUSION Since the Board is unable to proceed without aproperrepresentative, ASBCA No. 59114 is dismissed without prejudice. Dated: 26 April 2017

(Signatures continued)



### 5 Administrative Judge Armed Services Board ofContract AppealsI concur

MARK N. STEMPLER Administrative Judge Acting Chairman Armed Services Board ofContractAppeals I concur

RICHARD SHACKLEFORD Administrative Judge Vice Chairman Armed Services Board ofContractAppeals

I certify that the foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContract Appeals in ASBCA No. 59114, Appeal ofUSAC Aerospace Group Inc. dba USAC Aerospace Group: Aerostructures, rendered in conformance with the Board's Charter. Dated:



### 6 JEFFREY D. GARDIN Recorder, Armed Services Board ofContractAppeals