N OTE : This disposition is nonprecedential. 

# United States **Court of Appeals**  **for the Federal Circuit**

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WESTERN STATES FEDER AL CONTRACTING, LLC, Appellant

v.

DEPARTMENT OF VETERA NS AFFAIRS, Appellee

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2016

- 1042

______________________ Appeal from the Civilian Board of Contract Appeals in No. CBCA 4612(3359)

- REM, Administrative Judge Patr icia J. Sheridan.

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Decided: J uly 15, 2016

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R OBERT J. B ERENS , Salamirad Morrow Timpane & Dunn LLP, Phoenix, AZ, argued for appellant.

E LIZABETH A NNE S PECK , Commercia l Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for appellee

. Also represented b y B ENJAMIN C. M IZER , R OBERT E. K IRSCHMAN , J R ., P ATRICIA M. M C C ARTHY ; D AVID G. F AGAN ,WESTERN STATES FEDER AL v. DVA 2

United States Department of Veterans Affairs, Washin gton, DC.

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Before N EWMAN , C HEN , and H UGHES , Circuit Judges.

H U GHES , Circuit Judge.

Western States Federal Contracting, LLC appeals the Civilian Board of Contract Appeals’ decision dismissing its appeal for lack of jurisdiction . Because the Board erred in finding that Western States lacked capacity to maintain the la wsuit

, we reverse the Board’s decision and remand for further proceedings.

I
On September 30, 2009, the Department of Veterans Affairs contracted Western States to , among other things, alter and expan d the fire alarm and sprinkler system at the VA facility located in Phoenix, Arizona. The project took 699 days to complete

— 549 days longer than estima ted.
After the project was completed, Western States su bmitted a claim for $760,852.01 to the VA seeki ng compe nsation for damages related to the delay

. Because t he VA never issued a final decision on t he c laim it was deemed denied.
Upon denial of the claim, Western States appealed to the Board. The Board requested , at least three times, that Western Sta tes provide documentation establishing that it was in good standing in Delaware, the state of its organization

. Western States failed to provide this doc umentation, and o n February 11, 2014, the Board di smissed the case a fter finding that Western States did not have the capacity to maintain the action because it was not in good standing due to its failure to pay its Delaware franchise taxes

. Immediately thereafter, Western StatesWESTERN STATES FEDER AL v. DVA 3

paid its franchise taxes and was returned to good stan ding.

Western Stat es appealed to this court on June 10, 2014. Afte r Western States filed its opening brief, the VA filed an unopposed motion seeking to voluntarily remand the case so that the Board could address, among other things, whether Western States was an “unincorpo rated association” under Fed. R. C iv. P. 17(b)(3)(A). On March 19 , 2015, we entered an order vacating the Board’s d ec ision and remand ing the case for additional procee dings consistent with the order

. On remand, Western States argued that because it

was then in good standing

, and the decision dismissing its claim had been completely vacated

, the Board was r equired to consider the merits of its claim

. The Board disagreed “ be cause, at the time [the Board] dismissed this case for lack of jurisdiction, Western States was not in good standing, and Board Rule 26(a) (48 CFR 6101.26(a) (2014)) does not allow relief based on evidence that could have been presented at the underlying proceeding.” J.A. 12. The Boa rd dismissed the claim a second time after conclud ing that Western States was not an “unincorp orated association” under Fed . R. Civ. P. 17(b)(3)(A)

. J.A.
1– 15

. Western States a gain a ppeals

, arguing that the Board erred in finding that it did not have capacity to prosecute the case on remand. We have jurisdiction under 28 U.S.C. § 1295(a)(10).

II

We review the Board’s conclusions of law without de ference. Reliab le Contracting Grp., LLC v. Dep’t of Vete rans Affairs , 779 F.3d 1329, 1331 (Fed. Cir. 2015). We will uphold the Board’s factual findings unless those findings are “(A) fraudulent, arbitrary, or capricious; (B) so grossly erroneous as to necessarily imply bad faith; or (C) notWESTERN STATES FEDER AL v. DVA 4

supported by substantial evidence.” 41 U.S.C. § 7107(b)(2)

. D uring the first appeal, this court vacated the Board’s initial opinion in its entirety

. J.A. 68. T o “vacate” a decision “means to annul; to cancel or rescind; to declare, to make, or to render, void; to defeat, to deprive of force; to make of no authority or v alidity; to set aside.” Ala

. Power Co. v. EPA , 40 F.3d 45 0, 456 (D .C. Cir. 1994).

A lthough the Board initially dismissed the case b ecause Western States was not in good standing under Delaware law, s ee Del. Code Ann. tit. 6, § 18

- 1107(l ); J.A. 55, the va catur annulled this d ismissal in its entirety

, Ala

. Power Co. , 40 F.3d at 456

. Consequently

, on remand, the Board could not rely on the initial dismissal as grounds for finding that Western States lacked the capa city to maintain the action. Moreover, the Board could not justify dismissing the case based on the fact that Western States was not in good standing at the time of the initial dismissal because Delaware law allows an LLC to mai ntain an action once it has been r estored to good standi ng. Del. Code Ann. tit. 6, § 18

- 1107(l ).

B ecause we vacated the Board’s in itial dismissal in its entirety and Western States had been restored to good standing at the time of the remand, the Board was r equired to consider the merits of Western States’ claim. Further, because Western States had the capacity to maintain the action under Delaware law, we need not decide whether the Board erred in its determination that Western States was not an “unincorporated association” under Fed. R. Civ. P. 17(b)(3)(A ).
We appreciate that Western States was not diligent in this matter and that the Board gave them sufficient opportunities to correct their lack of good standing before initially dismissing the appeal. Moreover, we recognize that the VA in good faith sought a limited remand to address an alternative legal theory not first considered byWESTERN STATES FEDER AL v. DVA 5

the Board. We applaud the government’s willingness to seek such voluntary remands and do not intend to di scourage that practice. However, this court’s prior order did not grant a limited remand, but, rather, vacated the B oard’s prior decision in its entirety. As a subsequent panel, we are bound by the plain language of that order. Therefore, we reverse and remand to the Board for co nsideration of the merits of Western States’ claim.

REVERSED AND REMANDE D