NOTE: This disposition is nonprecedential.

United States Court of Appeals 

for the Federal Circuit ______________________ 

CCI, INC.,

Appellant

v.

JOHN MCHUGH, Secretary of the Army,

Appellee

______________________ 

2014-1470

______________________ 

Appeal from the Armed Services Board of Contract 

Appeals in No. 57316, Administrative Judge Cheryl L. 

Scott. 

______________________ 

Decided: April 10, 2015

______________________ 

JAMES E. HOWARD, Davis Wright Tremaine LLP, Seattle, WA, argued for appellant. Also represented by LISA M.

MARCHESE, TRAEGER MACHETANZ, JONATHAN A. DEMELLA. 

JEFFREY A. REGNER, Commercial Litigation Branch, 

Civil Division, United States Department of Justice, 

Washington, DC, argued for appellee. Also represented by 

JOYCE R. BRANDA, ROBERT E. KIRSCHMAN, JR., MARTIN F.

HOCKEY, JR. 

______________________ 
2 CCI, INC. v. ARMY

Before NEWMAN, REYNA, and HUGHES, Circuit Judges.

HUGHES, Circuit Judge. 

CCI appeals the Armed Services Board of Contract 

Appeals’ denial of its Type I claim for equitable relief 

under Differing Site Condition Clause FAR 52.236-2. The 

Board concluded that CCI had not proven any of the four 

elements necessary to establish a Type I equitable adjustment claim. Accordingly, to prevail on appeal, CCI 

must show the Board erred on all four elements. Because 

substantial evidence supports the Board’s decision on at 

least two of these elements—whether the site conditions 

were reasonably foreseeable to CCI and whether CCI 

relied on the alleged site representations—we find that 

CCI has not met this burden. Accordingly, we affirm. 

I 

On April 25, 2008, the Army issued a Request for 

Proposals (RFP) to plan, design, and construct an Lshaped pier and perform related work at Umm Qasr, the 

only deep-water seaport in Iraq. The Army found that 

Umm Qasr was “a critical link towards the import of lifeproviding assistance being provided to the people of Iraq.” 

J.A. 4859. 

Attached to the RFP was a 2007 engineering report 

from Andrea Engineering Tests Laboratory (the Andrea 

Report). The Andrea Report describes a field investigation of an area including the Umm Qasr project site, and 

included results obtained from disturbed samples1, undis1 Disturbed samples have been altered in a way 

that makes them unrepresentative of in-situ conditions. 

They are frequently used to determine properties of the 

soil that are not dependent on in-situ conditions, such as 

soil grain size. 

 
CCI, INC. v. ARMY 3

turbed samples2, and a Standard Penetration Test3

performed on three boreholes. 

In the “Discussion of Results” section, the Andrea Report includes several descriptions of the soil, such as: 

• “The site subsoil consists mainly from two layers, 

the first layer of very soft, soft to medium gray 

sandy silty clay with amount of soluble salts and 

organic matter overlaying on a layer of medium, 

dense to very dense gray silty sand.” J.A. 4809.

• “[T]he site was within the ebb and tide zone of the 

sea. The saturated soil condition below the water 

table makes the problem of settlement significant 

. . . .” Id.

• “The low bearing capacity of the soft clayey layer; 

could lead to excessive settlement to go out of control.” J.A. 4810. 

• “[The] samplers that extruded from shelby tubes of 

the soft clayey layer . . . exudes between the fingers 

when squeezed in the fist so this could described as 

very soft to soft sandy clayey soil.” Id.

• “Investigation of the site area has produced evidence of some kind of collapse due to the reaction 

between fundamental compounds of the soil (sandy 

2 Undisturbed samples contain conditions close 

enough to the in-situ conditions to be used to approximate 

in-situ structural properties. 

3 A Standard Penetration Test is a common test 

used to determine the geotechnical engineering properties 

of soil. It involves driving a thick-walled hollow tube into 

the soil with a 140-pound hammer and recording the blow 

count—the number of blows to the hammer necessary to 

increase the depth of the tube by a predetermined distance. 

 
4 CCI, INC. v. ARMY

clayey layer) with organic matter, this collapse is 

impact the settlement of shallow foundation about

(2 – 5) %.” J.A. 4810–11.

Appendix B of the Andrea Report includes soil descriptors and the blow count data obtained from the 

Standard Penetration Test. The parties agree that Appendix B of the Andrea Report contains inconsistent

information, because the soil descriptors indicate the soil 

is very soft to soft, but the blow count data indicates the 

soil is harder. 

Another attachment to the RFP is a U.S. Agency for 

International Development report entitled “Umm Qasr 

Port Assessment” (the USAID Report). The USAID 

Report was prepared as a “general assessment of functions at the port and historical dredging operations at the 

port.” J.A. 18354. It describes the history of dredging at 

the site, the need for continuous dredging at the site, and 

the locations of the dredged material disposal sites. The 

report also includes the following site condition description: 

The streams are alluvial and the channels are apparently composed primarily of sand and silt. Clay 

may be present, but no clay balls were seen in the 

dredged material disposal areas. There is a thin 

film of sun-cracked silt or clay at some of the final 

settlement ponding areas. Boring information 

shows the materials encountered in the original 

“new” port excavation as silty sand with small fine 

gravel and clay. Infill sediments since then may 

be of a finer, more silty nature. 

J.A. 4863. 

After the RFP issued, CCI agreed to join two other 

companies, PolyEarth Construction, International LLC 

(PCI) and PND Engineers, Inc. (PND), in preparing a bid 

proposal for the Umm Qasr project. PND and PCI were 
CCI, INC. v. ARMY 5

responsible for the engineering and logistical aspects of 

the proposal, and CCI was responsible for the financial 

aspects of the proposal. 

During the Umm Qasr bidding period, a number of 

questions were submitted to, and subsequently answered 

by, the Army. Two are relevant to this appeal:

Question 11: Soil investigation not enough we 

need more point of locations.

Answer 11: The best soil investigation data available to the government is provided in Appendix-C 

Geotechnical Investigation of the SOW. The contractor should assume the data provided in Appendix C is representative of the project site. 

Question 42: Geotechnical Conditions: Will the 

government be providing any bidding assumptions 

associated with the existing geotechnical conditions? For bidding purposes, should the contractor assume the three borings provided are 

representative of the entire site?

Answer 42: The contractor should assume the 

three borings provided are representative of the 

entire site for the purposes of developing a proposal. However, additional geotechnical information may be required during the design phase 

of this project.

J.A. 4833; J.A. 4838. 

In May 2008, CCI submitted an initial proposal for 

the Umm Qasr project. In August 2008, CCI submitted a 

revised proposal. On September 10, 2008, the Army 

awarded CCI the contract for the Umm Qasr project. The 

contract incorporated Differing Site Conditions Clause 

FAR 52.236-2 and Site Investigations Affecting the Work 

Clause FAR 52.236-3. 
6 CCI, INC. v. ARMY

In 2009, CCI began construction on the Umm Qasr 

project. CCI initially used land-based construction methods and encountered difficulties building a crane pad due 

to the soil conditions at the project site. It ultimately 

switched to marine-based construction to complete the 

project. 

In August 2009, CCI submitted a Type I request for 

equitable adjustment to the Army, alleging that it incurred additional costs as a result of soil conditions that 

were different than represented in the Andrea Report. 

The Army denied CCI’s claim, and CCI appealed to the 

Board. The Board also denied CCI’s claim. CCI appeals. 

We have jurisdiction under 28 U.S.C. § 1295(a)(10). 

II

To receive an equitable adjustment for a Type I differing site condition, a contractor must prove by a preponderance of the evidence that: (1) “a reasonable contractor 

reviewing the contract documents as a whole would 

interpret them as making a representation about the site 

conditions”; (2) “the actual site conditions were not reasonably foreseeable to the contractor, with the information available to the particular contractor outside the 

contract documents”; (3) “the contractor in fact relied on 

the contract representation”; and (4) “the conditions 

differed materially from those represented, and the contractor suffered damages as a result.” Int’l Tech. Corp. v. 

Winter, 523 F.3d 1341, 1348–49 (2008). Whether a reasonable contractor reading the contract documents as a 

whole would interpret them as making a site-condition 

representation is a legal question reviewed de novo. Id. at 

1349. The other three elements are questions of fact 

reviewed for substantial evidence. Id. “Substantial 

evidence means such relevant evidence as a reasonable 

mind might accept as adequate to support a conclusion.” 

E.L. Hamm & Assocs., Inc. v. England, 379 F.3d 1334, 

1338 (Fed. Cir. 2004).
CCI, INC. v. ARMY 7

The Board held that CCI did not prove any of these 

four elements. Accordingly, to prevail on appeal, CCI 

must show that the Board erred on each of these four 

elements. See Int’l Tech. Corp., 523 F.3d 1348–49. Because CCI has failed to show that the record does not 

provide substantial evidence to support the Board’s 

findings that (1) the site conditions were reasonably 

foreseeable to CCI or (2) CCI did not rely on the alleged 

site condition representations, CCI has not met this 

burden.

A 

When determining whether site conditions were reasonably foreseeable to the contractor, both the contract

and any other information available to the contractor are

considered. Id. at 1349. Under this standard, substantial 

evidence supports the Board’s finding.

Specifically, the Andrea Report supports the finding 

that the soil conditions actually encountered were reasonably foreseeable. It frequently describes the area as 

having soil settlement issues and as containing soft to 

very soft soils. See, e.g., J.A. 4809 (describing the first 

layer of the site subsoil as “very soft, soft to medium gray 

sandy silty clay”); id. (“The saturated soil condition below 

the water table makes the problem of settlement significant . . . .”); J.A. 4810 (“The low bearing capacity of the 

soft clayey layer; could lead to excessive settlement to go 

out of control.”); id. (“[The] samplers that extruded from 

Shelby tubes of the soft clayey layer . . . exudes between 

the fingers when squeezed in the fist so this could described as very soft to soft sandy clayey soil.”); J.A. 4810–

11 (“Investigation of the site area has produced evidence 

of some kind of collapse due to the reaction between

fundamental compounds of the soil (sandy clayey layer) 

with organic matter . . . .”). 

CCI asserts that because of the Army’s answer to 

Question 42—that contractors “should assume the three 
8 CCI, INC. v. ARMY

borings provided are representative of the entire site”—it 

reasonably relied solely on the borehole data in Appendix 

B of the Andrea Report. But even if this is correct, it does 

not show a lack of substantial evidence because the soil 

descriptors in Appendix B describe the soil near the 

project site at the relevant depth as being “[v]ery soft to 

soft gray to dark gray silty CLAY.” J.A. 4818–19. 

CCI argues that because the blow count data in Appendix B of the Andrea Report indicates a harder soil, and 

engineers view objective data, such as blow count data, as 

more reliable than soil descriptors, the soil conditions it 

encountered were not reasonably foreseeable. 

The record shows that the inconsistencies in the Andrea Report caused engineers to be skeptical of its reliability. For example, the engineer CCI used to prepare its 

proposal, Mr. Nottingham, admitted that the information 

in Appendix B of the Andrea Report is “not consistent.” 

J.A. 330. The Army’s expert, Mr. Apted, agreed and 

testified that “it should have been clear that the Andrea 

report was limited in extent and quality and there was a 

risk of more difficult conditions” and that—given the 

amount of other data indicating softer soil conditions—the 

blow count data is “clearly an anomalous set of data[.]” 

J.A. 17468–69. According to Mr. Apted, the Andrea

Report would have caused him to expect “very soft clay.” 

J.A. 2904. Given this evidence, a reasonable mind could 

conclude that the soil conditions were reasonably foreseeable to CCI. 

The USAID Report provides additional support for the 

Board’s finding. It describes the need for continuous 

dredging near the site and the locations of the dredged 

material disposal sites. The Army’s expert, Mr. Apted, 

testified that, given this report, “the risk of accumulation 

of silt and clay disposal arising[] from dredging could have 

reasonably be[en] foreseen as a significant risk.” J.A. 

17469. 
CCI, INC. v. ARMY 9

Moreover, CCI was already aware of the area’s dredging issues before it read the USAID Report. Mr. Nunn, a

civil and nuclear engineer and co-founder of PCI involved 

in the Umm Qasr proposal and project, worked near the 

project site before CCI submitted its proposal. He was 

familiar with the area’s dredging issues and knew that a 

dredging contractor was on site, that “[t]hey were spending millions of dollars dredging the naval port[,]” and that 

“the other piers were already clogged with siltation.” J.A. 

420. 

In light of this evidence, we conclude that a reasonable mind could agree with Mr. Apted that “the conditions 

encountered could and should have been within the 

reasonable contemplation of CCI.” J.A. 17469. Accordingly, we conclude that substantial evidence supports the 

Board’s finding that the soil conditions were reasonably 

foreseeable to CCI. 

B 

Substantial evidence also supports the Board’s finding 

that CCI did not prove that it relied on the alleged misrepresentation. CCI admits that it viewed the Andrea 

Report as containing inconsistent information and being

insufficient to determine whether the project could be 

completed with land-based construction. This admission 

makes it unlikely that CCI relied on the Andrea Report, 

and provides support for the Board’s finding.

Additionally, we agree with the Board that the proposal itself does not support CCI’s assertion that it relied 

on the Andrea Report. Nothing in the proposal identifies 

whether land or marine construction would be performed. 

Although Mr. Nottingham testified that he relied on the 

Andrea Report and that the cost estimate in the proposal 

specifically factored in the cost of land-based construction,

this does not mean that the Board was required to accept 

his testimony. The Board has “broad discretion in determining credibility because he saw the witness and heard 
10 CCI, INC. v. ARMY

the testimony.” J.C. Equip. Corp. v. England, 360 F.3d 

1311, 1315 (Fed. Cir. 2004) (internal quotation omitted). 

Accordingly, “[t]he Board’s determinations of witness 

credibility are virtually unreviewable.” Id. (internal 

quotation omitted) (alteration in original). Moreover, 

even if Mr. Nottingham’s cost estimate shows that CCI

assumed the project could be completed using land-based 

construction, it does not show that the Andrea Report was 

the basis for CCI’s assumption. 

Additionally, the proposal actually provides support 

for the Board’s finding that CCI did not rely on the Andrea Report. As CCI concedes, the Andrea Report and the 

proposal “depict different approximations of the depth at 

which sand and silt would be encountered.” Appellant’s 

Br. at 55. If CCI did in fact rely on the borehole log data

from the Andrea Report to predict harder soil conditions, 

there is no plausible reason to believe it would not have

also used the Andrea Report’s approximations for what 

depths sand and silt would be encountered. 

In light of this evidence, we hold that a reasonable 

mind could conclude that CCI did not rely on the Andrea 

Report in preparing its proposal.

III

Because we conclude that substantial evidence supports the Board’s findings that (1) the site conditions were 

reasonably foreseeable to CCI and (2) CCI did not rely on 

the Andrea Report in preparing its proposal, we do not 

need to reach the other two elements of CCI’s equitable 

adjustment claim. Accordingly, we affirm the Board’s 

conclusion that CCI is not entitled to a Type I equitable 

adjustment. 

AFFIRMED