ARMED SERVICES BOARD OF CONTRACT APPEALS Appeal of-- CP ofBozeman, Inc. Under ContractNo. FA4626-12-H-OOO 1 ) ) ) ) ) ASBCA No. 58491

APPEARANCE FORTHE APPELLANT: Mr. Raul Luciani Owner APPEARANCES FORTHE GOVERNMENT: Lt Col James H. Kennedy III, USAF AirForce ChiefTrial Attorney AnnaF. Kurtz, Esq. Capt George Mathew, Esq.

Trial Attorneys OPINION BYADMINISTRATIVE JUDGE CLARKE This appeal involves a termination for cause ofa Non-Appropriated Fund Instrumentality (NAFI) concession contract to operate two food concessions on Malmstrom AirForce Base (AFB), Montana. We deny inpart and sustain in part. FINDINGS OF FACT 1. On 12 July 2011the341stForce Support Squadron issued a Request for Proposals for a NAFI contractto operate food concessions at the Community Activities Center (Grizzly Bend) and the Bowling Center (Aces High) on Malmstrom AFB (supp. R4, tab 1). 2. By email dated 20 July 2011, Mr. Luciani, owner ofCP ofBozeman, Inc., submitted a list ofquestions to Ms. Redding, contract specialist, that included:

- Please provide head count and income for the past twelve months[.]

- Pleaseprovide expenses for the pasttwelve month[s].

- Please provide estimate ofassume inventory at bowling alley. Is there any inventory to assume at the Grizzly? When will the questions and answers be released?- Please provide building seating capacity. (Supp. R4, tab 5 at 3) These questions were sentto the First Support Squadron to be answered (tr. 2/38, 71-72). The 26 July 2011 response to Mr. Luciani took the form of a "Questions and Answers" (Q&A) document that included the following: Q: What is the head count and income for the past 12 months for the Bowling Center? A: Head count: 3,429 permonth; income: $246,872 (cost ofgoods

- 40%). Q: What are expenses for the pasttwelve months for the Bowling Center? A: Supplies

- $30,265; minor maintenance

- $2,942; coupons - $8,317; personnel

- $86,834.

Q: What is the head count and income for the past 12 months for the CAC [Community Activities Center]? A: Head count: 750-1000 permonth; income: $146,747 (cost ofgoods -40%). Q: What are the expenses for the pasttwelve months for the CAC? A: Maintenance

- $3,821; Coupons

- $1,194; Supplies

- $12,013; Personnel Cost

- $72,203. (Supp. R4, tab 5 at 1) Mr. Luciani thoughtthe financial information provided on 26 July 2011 was "odd" in its format, but he did not ask follow-up questions about it (tr. 1/98). Hetestified thathe interjJreted the information to show "$1,000 a month positive flow" buthe didn'ttake into accountthe monthly stipends of$1,000 and $750.00 (tr. 11110-11) (see finding 3). Concerningthe Q&Aresponse (R4, tab 34 at 9), Mr. Luciani was asking for total gross sales information (tr. 11150). Atthe trial he testified that the answer "$246,000.00

...cost ofgoods

...40 percent" meantthat the 40% came out ofthe $246,872 (tr. 11151). 1
3. Contract No. FA4626-12-H-0001 (0001) was awarded to CP ofBozeman on 17 October 2011 to operate two concessions (R4, tab 1 at 2). In consideration for the

1Inhis 14 October 2012 claim Mr. Luciani argued that the "cost ofgoods -40%"was misleading and should have been listed with the other expenses (R4, tab 34 at 2).
2contract, CP ofBozemanwas to pay a monthly stipend of$1,000 for Grizzly Bend and $750 for Aces High and 7% ofgross sales for each (R4, tab 1 at 1). The contract includedthe following relevant clauses: 2. Termination: Notwithstandingthe clausetitled "Termination for Convenience" ofthe General Provisions relative to termination ofthis Concessionaire contract, it is mutually agreed that this Concessionaire contract may be terminated in whole or in part by eitherparty:

a. Immediately on written notice to the otherparty in the event ofbreach ofthis Concessionaire contractby the other party. b. On 1-day notice in writing to the otherparty. No liability ensues to eitherparty for terminations rendered pursuantto this subparagraph b. 8. TERMINATION FORCONVENIENCE (JAN 2005)

- The Contracting Officer, bywritten notice, may terminate this contract, in whole orinpart, when it is in thebest interest ofthe NAFI. Ifthis contract is for supplies and is so terminated, the Contractor shall be compensated in accordance with FAR, Sub Parts 49.1and49.2 in effect on this contract's date. To the extentthatthis contract is for services and is so terminated, the NAFI shall be liable only for payment in accordance withthe paymentprovisions of this contract for services renderedpriorto the effective date oftermination, providing there are no Contractor claims covering nonrecurring costs for capital investment. Ifthere are any such Contractor claims, they shall be settled in accordance with FAR, Sub Parts 49.1 and 49.2. 10. TERMINATION FORCAUSE (JAN 2005) a.(l) TheNAFI may, subjectto paragraphs (c) and (d) below, by written notice ofcause to the Contractor, terminate this contract in whole orinpart ifthe Contractor fails to

- (i) Deliver supplies orperform the service within the time specifiedwithin this contract or any Extension; (ii) Makeprogress, so as to endangerperformance ofthis contract (but see subparagraph (a)(2) below); or

3(iii) Perform any ofthe otherprovisions ofthis contract (but see subparagraph (a)(2) below) (2) The NAFI's right to terminate this contractunder subdivisions ( 1 )(ii) and ( 1 )(iii) above, may be exercised if the Contractor does not cure such failure within 10 days (ormore ifauthorized in writing by the Contracting Officer) after receipt ofnotice from the Contracting Officer specifying the failure.

f. Ifaftertermination, it is determined that the cause bythe Contractor was excusable, the rights and obligations ofthe parties shall be the same as ifthe termination hadbeen issued for convenience ofthe NAFI. (R4, tab 1at 75, 79-80) The contract also included a Disputes clause that included in part:

a. Except as otherwise provided in this contract, any dispute or claim concerning this contractwhich is not disposed ofby agreement shall be decided by the Contracting Officer, who shall state his decision in writing and mail or otherwise furnish a copy ofit to the Contractor. Within 30 days from the date ofreceipt of such copy, the Contractor may appeal by mailing or otherwise furnishing to the Contracting Officer a written appeal addressed to the Armed Services Board ofContract Appeals, and the decision ofthe Board shall be final and conclusive; providedthat ifno such appeal is filed, the decision ofthe Contracting Officer shall be final and conclusive. (R4, tab 1at5) Mr. Weibel is the Director ofBusiness Operations for the 341st Contracting Squadron, Malmstrom AFB (tr. 1/184). He explained thatthe contract was to run the snackbar at the Aces High Bowling Center, the food concession at the Grizzly Bend Club at the Community Activity Center (CAC) and do catering for the CAC (tr. 1/187-88). Mr. Weibel signed the 0001 contract (tr. 1/188; R4, tab 1at2). 4. During CP ofBozeman'sperformance ofthe contract the NAFI expressed concern over food service operations and sent numerous letters ofconcern and cure
4notices (supp. R4, tab 51 at 2-4). At one point, 

### Mr. Weibel offeredto let 

### Mr. Luciani close Aces High andjustrun Grizzly Bend (tr. 1133). 

### Mr. Luciani testified thathe was "pretty much" consistently losing money on Aces High, but he didn't "stop" operating Aces High because he was able to increase prices and he hoped to fine tune the operation at Aces High to make money (tr. 1/90). 5. 

### Mr. Weibel met with 

### Mr. Luciani on 5 May 2012 to discuss the contract. On 6 November 2012 

### Mr. Weibel signed a memo documenting the meeting. (R4, tab 35)2 

### Mr. Luciani believed that he should have been making more money based on the 26 July 2011 Q&Aresponse to his request for financial information. 

### Mr. Weibel went through the Q&A numbers and pointed out to 

### Mr. Luciani that he had failed to reduce the Aces High and Grizzly Bend income by the 40% cost ofgoods. The result of accounting for the 40% was that Aces High would see a return ofapproximately $18,582.403 and the Grizzly Bend a loss of$1,182.80. 

### Mr. Weibel recalled in the memo that 

### Mr. Luciani said, "Oh, I didn'trealize that." (Tr. 1/192-93; R4, tab 35 at 1) 6. On 9 May 2012, 

### Mr. Luciani met with CO Wood, Mr. Weibel and Ms. Redding and expressed his concernthat his concessions were notprofitable (R4, tab 13 at 1). By letter dated 14 May 2012 to CO Wood, 

### Mr. Luciani "follow[ed] up" the 9 May 2012 meeting again expressing his concerns overthe fact thatthe Grizzly Bend and Aces Highwere not profitable. Mr. Luciani stated: During negotiations I asked for a financial statement for both the Aces High and the Grizzly Bend, these statements showed the Grizzly Bendwas not making any profit however according to the figures provided the Aces High was supposed to bring in $118,508.00 net income which we were excited about because ifwe did not make money at the Grizzly as it wasjustbeing opened, then we could use the net from the Aces and use itto make up the difference at the Grizzly Bend. (R4, tab 13 at2) The only way to arrive at nearthe $118,508 figure for Aces High is to ignore the parenthetical "(cost ofgoods

- 40%)"; here is the calculation: (Income

- Expenses) $246,872

- ($30,265 

### + $2,942 

### + $8,317 

### + $86,834) = $118,514 (finding 2). Subtracting the 40%results in the following calculation: $246,872 x .60 = $148,123.20; $148,123.20

- ($30,265 

### + $2,942 

### + $8,317 

### + $86,834) = $19,765.20.

2 Contracting Officer (CO) Wood asked Mr. Weibel to prepare the memo when she was getting ready to issue her final decision denying CP ofBozeman's claim (tr. 11192). 3 This amountwas before accounting for the $750 stipend and 7% payments (R4, tab 1 at 1).

5Further subtracting the $750 per month stipend ($9,000) and 7% gross sales payment wouldresult in a loss. Mr. Luciani's 14 May 2012 letter states that Q&A financial data "showedthe Grizzly Bendwas not making any profithowever according to the figures provided the Aces Highwas supposed to bring in $118,508.00 net income." IfMr. Luciani followed the same methodology he used for Aces High in calculating the figure for Grizzly Bend, i.e., not subtracting the "(cost ofgoods

- 40%)" from the gross income, he wouldhave found that Grizzly Bend likewise made a profit; here is the calculation: $146,747-($3,821 

### + $1,194 

### + $12,013 

### + $72,203) = $57,516. If, however, Mr. Luciani subtracted the 40% at Grizzly Bendhe would get a loss; here is the calculation: $146,747 x .60 = $88,048.20; $88,048.20-($3,821 

### + $1,194 

### + $12,013 

### + $72,203) = -$1,182.80. Further subtractingthe $1000 per month stipend ($12,000) and the 7% gross sales paymentwould increase the loss (finding 6). Mr. Luciani's 14 May 2012 letter indicating a profit at Aces High and loss at Grizzly Bendwould seemto indicate thatMr. Luciani subtractedthe 40% cost ofgoods for Grizzly Bend, but not Aces High. There is no explanation ofthis apparent anomaly anywhere in the record orin the briefs.
7. On 15 May 2012, Mr. Luciani requested a detailed monthly income statement for Aces High (tr. 1138; app. supp. R4, tab 5 at 21). On 17 May 2012, the NAFI provided a monthly statement for fiscal year (FY 11)

- October 2010 through September 2011 (tr. 1/38-39; app. supp. R4, tab 5 at 19, 22). The monthly income statement showedthat for ten out ofthe twelve months theAces High lost money with a net loss for the year of$20,736 (tr. 1/39; app. supp. R4, tab 5 at 22; R4, tab 13 at 11). The "cost-of-goods" was 46% andpersonnel costs of$105,119 whereas the Q&A financial data he was providedbefore award showed "cost-of-goods" as 40% and personnel costs of$86,834 (tr. 1139-40; app. supp. R4, tab 4 at 12, tab 5 at 22). Mr. Luciani testified that he "would have neverpursuedthis contract should I have seen this.... I would nothave done this because this would have plain and simple, black and white put my family, the livelihood ofmy company at risk." (Tr. 1141, 45) Mr. Luciani acknowledgedthat in July 2011 when he asked for financial information before award, not all ofthis FY 11 information existed (tr. 11154). 8. Mr. Weibel testified thatthe data on the 26 July 2011 Q&A financial information was notthe same data as on the spreadsheet showing data from FY 11 (October 2010 to September2011). He testified thatthe Q&A information came from the FY 10 spreadsheet. (Tr. 11196-97; R4, tab 34 at 9, 13) He also testified thatthe stipend and the 7% ofgross proceeds would notbe onthe spreadsheet (tr. 1/199). 9. Mr. Douglas is a resource manager (finance), 341 stForce Support Squadron, Malmstrom AFB (tr. 11204). He is responsible for day-to-day operations ofthe accounting office (id.). He testified that the financial information provided onthe 26 July 2011 Q&A document came from the Aces High operating statement for FY 10 (tr. 11206-09; supp. R4, tab 60 at 9-11). The $246,872 and 40% are seen onpage 9 of

6the operating statement (tr. 11207; supp. R4, tab 60 at 9). The $30,265, $2,942, and $86,834 are seen on page 10 ofthe operating statement (tr. 2/207-09; supp. R4, tab 60 at 10). The $8,317 is seen onpage 11 ofthe operating statement (tr. 2/208; supp. R4, tab 60 at 11). The Q&Anumbers givento Mr. Luciani did not include $6,012 in utilities on page 11 ofthe operating statement because CP ofBozeman would nothave to pay utilities (tr. 2/209; supp. R4, tab 60 at 11). The spreadsheet given to Mr. Luciani on 17 May 2012 (finding 7) was generated from the FY 11 Aces High operating statement (tr. 1/209-1O; supp. R4, tab 56). 10. Mr. Hamilton is the deputy for the 341st Force Support Squadron, Malmstrom AFB (tr. 2/6). He was involved in CP ofBozeman's contract from the "verybeginning" (tr. 217). He testified that the NAFI gave Mr. Luciani the 2010 financial data in the Q&A documentbecause it felt that the 2010 datawas more comparable to CP ofBozeman's food operationthan the 2011 databecause in 2011 food service at the Grizzly Bendhadbeen curtailed (tr. 2/9-12, 20). 4
11. By letter dated 18 July 2012,5 Mr. Luciani notified Ms. Redding as follows:
I can'tkeep the Aces High open as it is losing money daily, I can'tpay stipend norrent for the Aces as I am no longer capable ofrunning this facility. I will notbe able to be open atthe Aces High afterFriday. (App. supp. R4, tab 10 at 42, 44) Mr. Luciani testified that this was his one-day notice oftermination pursuanttothetermination clause in the contract (tr. 1/49, 59). He terminated the Aces High portion ofthe contractto allow him to operate the Grizzly Bend at a profit (tr. 1/50). Ms. Wood is a CO at the 34lst Contracting Squadron, Malmstrom AFB (tr. 2/32). She was involved in CP ofBozeman's contract from the time the solicitation "hitthe street" (id.). CO Wood agreed that she received a one-day notice, but also testified that she was confusedbyMr. Luciani's 18 July 2012 letter stating he would be closing Aces High and "wasn't sure it was a termination" (tr. 2/55, 59).
12. As ofMonday 23 July 2012 CP ofBozemanhad closedAces High and was removing their inventory (supp. R4, tab 49 at 3-4). Onthe same day CO Wood spoke

4 In its post-hearing brief, the NAFI agrees that the Q&A financial information came from FY 2010 financial data (gov'thr. at 8, 

### ii 12). 5 The "letter" does nothave an addressee and it is unclear ifthe letter was actually delivered to the NAFI on Wednesday 18 July 2012 orby email on Thursday 19 July 2012 (app. supp. R4, tab 10 at 42, 44). However, NAFI documents indicate that it was delivered on Wednesday 18 July 2012 (supp. R4, tab 50 at 1, 

### ii 4.a.) andthat is whatwe find.

7to Mr. Luciani and informed him that he could not unilaterally close the Aces High without approval ofthe CO and that ifhe did he wouldbe in default (id. at 1 ). 13. By email dated 23 July 2012 to Mr. Luciani, Ms. Redding wrote: Raul, Please be advised that you cannot take an action such as closing the Aces Highwithout approval from a Contracting Officer (i.e., Carolyn orChuck). Otherwise, you will be in default ofthe terms and conditions ofthe contract. (R4, tab 30 at 1) Mr. Weibel is "Chuck" and he was copied onthe email. Atthe hearing he testifiedthat now he did not agree with the email. (Tr. 11201-02) 14. On 24 July 2012 a meeting was held withinthe NAFI to discuss termination ofCP ofBozeman's contract. The decision was madeto immediately terminate CP ofBozeman's contract for the following reasons: Basis for immediate termination:

a. On 18 July 2012, CP ofBozeman informed 341 CONS that they could not continue to operate atthe Aces High High [sic] (Bowling Center). Attachment 1 b. On 23 July 12, Mrs. Lippert Wood spoke to Mr. Luciani and informed him that he couldnotmake the decision unilaterally to close the Bowling Center. Mrs. Lippert Wood statedthat ifhe chose to close without approval ofa contracting officer, he wouldbe in default ofthe contract. Attachment 2

c. On 23 July 2012, Mr. Luciani beganremoving his food and beverage items from the Bowling Center. Attachment 3. (Supp. R4, tab 50 at 1) At the hearing CO Wood agreed that there was nothing in the contractthat obligated Mr. Luciani to obtain "approval" from a CObefore exercising his right under the special provision providing for a one-day notice oftermination and she agreed thatherposition to the contrary was wrong (tr. 2/67). 15. By letter dated 25 July 2012, CO Wood terminated Contract No. FA4626-12-H-0001 for cause (R4, tab 31). The stated reason was:
8You are notified that Concessionaire Contract, FA4626-12-H-0001, is terminated for cause immediately in accordance with contract Special Provision paragraph 2(b), Termination. This termination is a result ofyour breach ofthe Concessionaire Contract, by refusing to performyour contractual requirements atthe Aces High. Youhave unilaterally modified the requirement by closing food services atthe Aces High Bowling Centerwithout approval from a contracting officer. (R4, tab 31 at 1) She testified at the hearing that it was not a final decision (tr. 2/45). There was no appeal rights notice in the termination notice. When asked at the hearing why she did not put an appeal rights notice in the termination for cause letter, CO Wood testified she was not accustomed to putting such a notice in a termination since it wasn't a final decision. (Id.; tr. 2/68-69) CO Wood demanded payment of $13,405.33 for "amounts due" (R4, tab 31at2). Atthe hearing CO Wood agreed that in fact CP ofBozemanwas not in breach ofthe contract (tr. 2/68). On 28 August 2012, CO Wood issued ModificationNo. 0003 unilaterally terminating the contract for cause "in coordination with Termination Notice 25 July 2012" (R4, tab 1 at 100). There was no notice ofappeal rights in the modification. 16. On 14 October 2012 CP ofBozeman submitted a certified claim of $161,407.00 for losses underthe 0001 contract (R4, tab 34). Mr. Luciani arguedthat he was mislead by the Q&A format answers to his questions: According to the information received 23 September, 2011 (Attachment "A"page 5),l61 1st question "WHAT IS THE HEAD COUNT AND INCOME FORTHE PAST 12 MONTHS FORTHE BOWLING CENTER?"the total income for the Aces High was disclosed to be $246,872.00 (COST OF GOODS-40%) for the past 12 months, second question "WHATARE THE EXPENSES FORTHE PAST 12 MONTHS FORTHEBOWLING CENTER?" the total expense is the sum ofthe figures provided "SUPPLIES $30,285, MINORMAINTENANCE $2,942.00, COUPONS $8,317.00, PERSONNEL $86,834.00" TOTAL= $128,378.00[.] Subtract from $246,872.00 it leaves a $118,494.00 net income or $9,874.50 permonth net income.

6 Attachment A, page 5, is the 26 July 2011 Q&A response to Mr. Luciani's questions (R4, tab 34 at 9).
9

### The first question was "WHAT IS THE HEAD COUNT AND INCOME FORTHE PAST 12 MONTHS'', since the question specifically asked for head count and income (not expenses) it is assumed by me the answer is total income and headcount. If

### cost ofgoods

- 40% is an expense it should have been addressed in the response to the second question "WHATARE THE EXPENSES FORTHE PAST 12 MONTHS FORTHE BOWLING CENTER[.]" If

### cost ofgoods implies an expense and it is 40% ofthe gross income, then this would equal $98,748.00 ofadditional expense that would need to be added to the expenses figure. If

### such is the case and ifthis information would have been answered as requested, this facility would have demonstrated it made $19,746.00 or $1,645.50 permonth net income. (Id. 

### at 0271-72) Mr. Luciani made a similar argument for the Grizzly Bend and calculated a net loss of$1,182.00 (id. 

### at 2). He also pointed out that when he asked for financial data for Aces High again he received a spreadsheet on 15 May 2012 that indicated Aces High had a loss for ten ofthe twelve months on the spreadsheet (id.). Mr. 

### Luciani states that had he known ofthe true financial information showing the losses, he would "have ceasedpursuit ofthis venture" (id. 

### at 3). Appellant's claim also alleges that the government should have advised appellant that several new fast food stores were soon to open on base (R4, tab 34 at 0273). When CP ofBozeman startedworkthere were four other food vendors on base. When the new BX opened that number went down to two, Popeye's and Subway (tr. 2/84). No detrimentto appellant was proven. 17. By final decision dated 12 December 2012, CO Wood denied CP of Bozeman's claim (R4, tab 36). CO Wood took the position that CP ofBozeman misinterpreted the Q&A financial information, specifically failing to reduce the gross income by the 40% cost ofgoods. She denied that the NAFI mislead CP ofBozeman because the Q&A information conformed to a "standardProfit and Loss (P&L) Statement." She further advised that it could have avoided the vast majority ofthe damages it sought ifit had invoked the one day notice terminationprovision ofthe contract, the very clause it did invoke (finding 11) which she deemed a breach on 25 July 2012 (finding 15). The decision included an appeal rights notice (app. supp. R4, tab 2 at 6). 18. By letter dated 28 December 2012, CP ofBozeman appealed CO Wood's 12 December 2012 final decision (app. supp. R4, tab 1). The appeal was docketed as ASBCA No. 58491 on 8 January 2013. The notice ofappeal questioned the rationale

10for denial ofthe monetary claim and also challengedthe earlier issued termination for cause. 19. At the hearing the NAFI presented government exhibit A (ex. G-A) that presentedthe financial data that Mr. Luciani requested-the last twelve months ofdata for July 2010 to June 2011 (tr. 1/220-22). The data on ex. G-A corresponds to the data in the operating statements for FY 10 and FY 11 (tr. 1/222-23; supp. R4, tabs 56, 58). Ex. G-A shows a loss of$13,898 at the Aces High for the previous twelve months of financial data Mr. Luciani requested. However, the FY 11 data includedbreakfast provided in FY 11 that CP ofBozeman was not required to provide, but provided anyway, which may explain the differences betweenthe years including the larger loss in FY 11 than FY 10 (tr. 11213-16). DECISION 

### Appellant'sAffirmative Claim Appellant's claimrequests $161,4077 in losses it allegedly suffered as a result ofthe government allegedly providing it pre-bid financial information that did not comportwiththe information it hadrequested and that the government did so purposefully with the intentto deceive and confuse the potential bidders8 (finding 16).9
Itis appellant'spositionthat had the information suppliedbeen what it requested10

, it would have never bid onthe solicitation (finding 7). We believe that the portion ofthis appeal involving appellant's affirmative claim is properly analyzed underthe doctrine ofsuperiorknowledge. Underthis doctrine the government has a duty to disclose critical information to potential contractors to preventthem from pursuing a ruinous course ofaction and failure to do so may be a breach ofa contractual duty. 

### McDonnellDouglas Corp. v. 

### UnitedStates, 323 F.3d 1006, 1020-21

7 On 15 May 2014, appellant moved to reopen the record and amend its claim upward to $5,082,133. The Board denied this motion on 23 June 2014 as premature since only entitlement was before the Board for decision. 8 There is no evidence to support a finding ofany intent to deceive orconfuse bidders. The only evidence is that governmentpersonnel were attempting to provide appellant with more comparable information (finding 10). 9 Appellant's claim also makes reference to two new fast food outlets opening after it commencedperformance and alleges thatthe government shouldhave advised it ofthe opening ofthese stores priorto bidding (R4, tab 34 at 273). As we found (finding 16), there is no factual basis for any allegation ofany detriment to appellant from this scenario, and we do not discuss it further. 10 Ofcourse, not all the information even existed at the time ofappellant's question (finding 7).
11(Fed. Cir. 2003). The elements ofproofofsuch a breach are: (1) the contractor undertook performance without the vital knowledge; (2) the government was aware that the contractor did not have the knowledge and had no reason to seek it; (3) the information that was supplied misledthe contractor or did notput it on notice to inquire; and (4) the government failed to provide the relevant information. 

### GAF Corp. v. UnitedStates, 932 F.2d 947, 949 (Fed. Cir. 1991), 

### certdenied, 502 U.S. 1971 (1992). We have held thatthe failure ofthe governmentto provide bidders on a NAFI solicitation with current monthly sales and income reports, rather than older data, when such information was requested and relevant, can amount to failure to disclose superiorknowledge. 

### Ogden-HCIServices, ASBCA No. 32169, 93-3 BCA

### ,-i 26,141 at 129,960, 

### aff'don recon., 94-1 BCA

### ,-i 26,489. We conclude that appellant's evidence fails to satisfy the tests set forth in

### McDonnellDouglas.
In this appeal, priorto bidding, appellant requested current financial informationregarding performance ofthe prior contract and received accurate financial informationbut for an earlier undisclosedperiod (findings, 2, 7-10). Appellant thoughtthe data was "odd"but made no further inquiry. Further, it made serious misinterpretations and mistakes with regard to the data supplied by the government. (Findings 2, 5) While it is clearthat the government did not provide appellant with data for the time period requested, we cannot hold that this was what induced appellant to bid. Appellant did notproperly treat the 40% cost ofgoods figure (findings 5, 6), nor did it properly take into account the monthly stipend orthe 7% gross sales payments that it was tobe responsible for payingto the government (findings 2-3, 5). Additionally, appellant apparently treated the figures inconsistently (findings 5, 6). Tothe extent that any ofthe information was ambiguous, such ambiguity was patent, especially since appellant apparently treated the figures differently (finding 6) for Aces High and Grizzly Bend. 

### NVTTechnologies, Inc. v. UnitedStates, 370 F.3d 1153, 1159 (Fed. Cir. 2004). Moreover, a comparison ofthe dataprovided by the government (findings 2, 7-10) to the data appellantrequested (finding 19), shows that once the 7% gross sales payments and the monthly stipendpayments and the 40% cost ofgoods figure are taken into account, both ofthe locations would have shown losses (findings 6, 7, 19). Itwas appellant's failure to properly use the dataprovided by the government and in the solicitation that deprived it ofthis loss information. The root cause of Mr. Luciani's trouble here is not the NAFI's erroneous financial data, but Mr. Luciani's failure to inquire ofthe NAFI what the parenthetical meant and as a result his failure to subtractthe 40% from the Aces High gross revenue and failure to account for the monthly payments CP ofBozemanwas obligatedto make to the NAFI. Underthese circumstances we conclude that the NAFI's failure to advise appellant that the information supplied in response to appellant's questions was from a differenttime

12

### periodthan that requested, did not act to appellant's detriment. It

### was Mr. 

### Luciani's erroneous use ofmuch ofthe available information that was the source ofits difficulties. We also cannot ignore the fact that Mr. 

### Luciani appears to have subtracted the 40% from the Grizzly Bendgross income to arrive atthe loss referred to in his 14 May 2012 letter -the "anomaly" discussed above (finding 6). We deny CP of Bozeman's claim. The Terminationfor Cause 

### The NAFI argues that we have nojurisdiction over the termination because Mr. 

### Luciani failed to file an appeal challenging the termination for cause (gov'tbr. at 34). The government asserts that ourjurisdiction over this NAFI contract dispute derives from the Disputes clause in the contract and not from the ContractDisputes Act (CDA), 41 U.S.C. §§ 7101-7109 (gov'tbr. at 35). Historically this assertion has been correct although Slattery 

### v. UnitedStates, 

### 635 F.3d 1298 (Fed. Cir. 2011), raises some questions as to the continuing validity ofthat doctrine. See Harry Richardson, 

### ASBCANo. 57582, 12-1BCAir34,902. We need notreach it in this case as our result would bethe same underthe Disputes clause orthe CDA.
It

### was the NAFI's obligation to issue the termination for cause in the form ofa final decision with notice ofappeal rights given to the contractor in orderto startthe 30-day appeal periodrunning and it totally failed to do so. Pathman Construction Co. v. UnitedStates, 

### 817 F.2d 1573, 1578 (Fed. Cir. 1987); see also Decker & Co. v. West, 

### 76 F.3d 1573, 1580 (Fed. Cir. 1996) (explaining thatPathman 

### is limited to situations where there is a total absence ofnotice ofappeal rights, butthat where the notice is merely defective, a contractor must show detrimental reliance on the defectto preclude the start ofthe running ofthe time for appeal). Under these circumstances it cannot be said that CP ofBozemanwas required to appeal the termination prior to its 28 December 2012 notice ofappeal. Here, appellant challengedthe termination for cause in its notice ofappeal of the contracting officer's denial ofits 14 October 2012 claim for losses underthe contract. Such challenge is not untimely. The statedbasis for the termination was, "This termination is a result ofyour breach ofthe Concessionaire Contract, by refusing to perform your contractual requirements atthe Aces High. You have unilaterally modified the requirement by closing food services at the Aces High Bowling Center without approval from a contracting officer." (Finding 15) This basis was wrong under the contract. At the hearing CO Wood agreedthat CO approval was not required for CP ofBozeman to exercise its unilateral rightto terminate Aces High with a one-day notice as it did on 18 July 2012 and that CP ofBozeman was not in breach ofcontract (findings 11,



### 1313-15). We sustain this aspect ofthe appeal and convert the termination for cause into a termination for convenience (see finding 3). CONCLUSION We deny the claim for misrepresentation and sustain the appeal ofthe termination for cause and convert it to a termination for convenience. Dated: 8 July 2015

I concur

MARK N. STEMPLER Administrative Judge Acting Chairman Armed Services Board ofContractAppeals Administrati e Judge Armed Services Board ofContractAppeals

CKLEFORD 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 ASBCANo. 58491, Appeal ofCP of Bozeman, Inc., rendered in conformance with the Board's Charter. Dated:

14 JEFFREYD. GARDIN Recorder, Armed Services Board ofContract Appeals