ARMED SERVICES BOARD OF CONTRACTAPPEALS Appeal of

-- ) ) Melwood Horticultural Training Center, Inc.) ) Under ContractNo. W911S0-11-F-0040 ) APPEARANCES FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ASBCA No. 60666

Larysa Kautz, Esq.

General Counsel Christie Roberts, Esq.

Assistant General Counsel Raymond M. Saunders, Esq.

Army ChiefTrial Attorney MAJ David H. Stem, JA

Trial Attorney OPINION BYADMINISTRATIVE JUDGE WOODROW ON THE GOVERNMENT'S MOTION TO DISMISS FORLACK OF JURISDICTION This appeal arises out ofa contract between the United States Army (Army) and Melwood Horticultural Training Center, Inc. (Melwood or appellant) for base operations facility maintenance services at Fort George G. Meade (FortMeade or FGGM) in Maryland. Appellant's request for additional funds in ASBCANo. 60666 seeks to recover costs for three separate matters: (1) reimbursement for retentionbonuses; (2) reimbursement for subcontractorpayments associated with allegedbreaches ofthe contract; and (3) an amount "TBD" (to be determined) for lost profits associated with services procured from vendors other than appellant, allegedly in violation ofthe terms of the contract. The Board consolidatedthis appeal with ASBCANo. 60323* and appellant subsequently filed a consolidated complaint. The Army moves to dismiss ASBCANo. 60666 for lack of jurisdiction. The government challenges the Board'sjurisdiction onthree grounds: (1) that the contracting officer (CO) never issued a final decision as to appellant's claim; (2) that appellant's claim fails to state a sum certain; and (3) that appellant's claim fails to state a claim on which reliefmay be granted. Although appellant's request for additional relief
*While ASBCA No. 60666 is consolidatedwith ASBCA No. 60323, this decision pertains only to the government's motion to dismiss in ASBCA No. 60666. However, the Rule 4 and supplemental Rule 4 references in this decision pertain to the submittal filed under ASBCANo. 60323.contains specific dollar amounts for some elements, the total amount ofthe request is an unspecified amount "tobe determined" and a total amount cannot readily be calculated by simple arithmetic. Accordingly, we holdthat we lackjurisdictionto entertain appellant's request in ASBCA No. 60666, because it fails to state a sum certain.
STATEMENT OF FACTS CSOF) FORPURPOSES OF THE MOTION
1. On 1July 2011, the Mission & Installation Contracting Command, Fort Eustis, Virginia (MICC orArmy) awarded ContractNo. W911S0-11-F-0040 to Melwood for facilities maintenance andrepair, sustainment, restoration, and modernization at FortMeade (supp. R4, tab 5 at 1).
2. The contract incorporatedby reference FAR 52.212-4, CONTRACTTERMS AND CONDITIONS

- COMMERCIAL ITEMS (JUN 2010), which reads in pertinentpart: (d)Disputes. This contract is subjectto 41 U.S.C. chapter 71, Contract Disputes. Failure oftheparties to this contract to reach agreement on any request for equitable adjustment, claim, appeal or action arising under orrelating to this contract shall be a dispute to be resolved in accordance withthe clause at FAR 52.233-1, Disputes, which is incorporated herein by reference. The Contractor shall proceed diligently with performance ofthis contract, pending final resolution ofany dispute arising underthe contract. (Supp. R4, tab 5 at 46)
3. The contract also incorporated by reference FAR52.233-1, DISPUTES (MAY 2014), which reads in pertinentpart: (c) Claim, as used in this clause, means a written demand orwritten assertion by one ofthe contractingparties seeking, as a matter ofright, the payment ofmoney in a sum certain, the adjustment or interpretation ofcontractterms, or otherreliefarising under orrelating to this contract. However, a written demand orwritten assertionby the Contractor seeking the payment ofmoney exceeding $100,000 is not a claim under 41 U.S.C. chapter71 until certified. A voucher, invoice, or other routine request for paymentthat is not in dispute when submitted is not a claim under 41 U.S.C. chapter 71. The submission may be convertedto a claim under41 U.S.C. chapter 71, by complying with the submission and certificationrequirements

2ofthis clause, ifit is disputed either as to liability or amount or is not acted upon in a reasonable time. (Supp. R4, tab 5 at 46) (Emphasis added)
4. By letter dated 11April2016, appellant mailed (via FedEx) a package with a completed version ofits "Claim: Request for Contracting Officer's Final Decision" to the CO on 14 April 2016 (supp. R4, tab 54). Also included in the letterwas a signed certification in accordance with FAR 33.207 (id. at 9).
5. In its submittal to the CO, appellant sought the following relief: [R]eimbursement for $114,000.00 for Retention Bonusespaid to Melwood'skey projectpersonnel and $130,985.00 for Melwood's GFEBS subcontractor, Thompson Gray, and Melwood's IT subcontractor, Corsica. Additionally, Melwood seeks the anticipatory margin andprofit associated with Fort Meade and MICC subcontracting andpurchasing made outside ofthe designated BASOPS ProcurementList provider, Melwood. (Supp. R4, tab 54 at 1)
6. Specifically, appellant soughtto recover costs for three items. First, appellant sought reimbursement for retention bonuses paid to Melwood's keyprojectpersonnel in the amount of$114,000.00plus a markup of20.87%. Second, appellant sought reimbursement for two ofMelwood's subcontractors, Thompson Gray and Corsica, in the amount of$130,985.00 plus a markup of20.87%. The total amount for these two elements not including mark-up is $244,985.00. Third, appellant sought "anticipatory lost profits" for alleged breaches ofthe contract associated with subcontracting andpurchasing made outside ofthe designated BASOPS ProcurementList provider, Melwood, in an amount "TBD." (See supp. R4, tab 54 at 1, 354)
7. Melwood subcontracted with Thompson Gray for General FundEnterprise Business System support (supp. R4, tab 54 at 6). Contract section C.1.9.l explains that the General Fund Enterprise Business System (GFEBS) is the Army's automated financial management system, which replaced the Integrated Facilities System-Maintenance (IFS-M) real property managementrecordkeeping system in fiscal year 2011 (supp. R4, tab 5 at 130).
8. Melwood subcontractedwith Corsica to provide additional Information Technology (IT) support (supp. R4, tab 54 at 6).
9. "BASOPS" stands for Base Operations SupportPlan (supp. R4, tab 5). The BASOPS ProcurementList, in turn, refers to the AbilityOne ProcurementList (PL), a list 3maintained by United States AbilityOne Commission ofproducts and services designed to create work opportunities for people who are blind or who have significant disabilities. See FAR Subpart 8.703, Procurement List.
10. Attachment 60 to appellant's 11 April 2016 letter states that it seeks total reimbursement in the amount: "$295,892.88 

### +TBD" (supp. R4, tab 54 at 354):

Retention Bonuses $114,000 IT Subcontractors (Thompson Gray & Corsica) $130,985 PL Violations $TBD Subtotal $244,985 

### +TBD Markup at 20.78% $50,907.88 

### +TBD Total $295,892.88 

### +TBD
11. Appellant mentions seven contracts, discussed in the chronology set forth in Attachment 1to the letter, as among the contracts that the Army awarded outside the designated BASOPS procurement list, allegedly in violation ofFAR 8.704, Purchase Priorities and FAR 8.706, Purchase Exceptions (PL Violations) (supp. R4, tab 54 at 8, 13, 71-72). Appellant does not set forth the dollar amount ofany ofthese contracts (id. at 71-72).
12. Appellant also states that the Army awarded an additional eight contracts during 2011through2014 which were worth "over $28,431,350." Accordingly, it "seeks the anticipatoryprofit from these 15 procurement actions described above as well as any other similar inappropriate actions not fully disclosed by FGGMMICC at this time." (Supp. R4, tab 54 at 8) 13. In a letter dated 13 June 2016, the CO responded to appellant's submittal, stating that: Based on a review ofthe claim, as well as the accompanying supporting documentation, the Government cannot make a Determination regarding Melwood's claim at this time, and the purpose ofthis correspondence is to request specific information in order for the Governmentto properly address Melwood's concerns.

This is not a final decision ofthe contracting officer, but rather a request for more information which, hopefully, will allow me to render an informed decision on your claim. (Supp. R4, tab 55 at 1, 4)

414. The CO's 13 June 2016 response did not notify Melwood ofthe time within which the CO would issue a final decision (supp. R4, tab 55).
15. Melwood did not respond to the CO'srequest for information (gov't mot. to dismiss at 3). 16. On 16 June 2016, appellant filed a notice ofappeal with the Board. Appellant's notice ofappeal stated that the "inability ofthe Contracting Officerto issue a decision, in accordance with FAR 33.21, Contracting officer's decision, (g) is deemedto be a denial ofthe claim thereby authorizing Melwood to file this appeal."
17. On 13 July 2016, the Board notifiedthe parties that appellant's 16 June 2016 notice ofappeal was docketed as ASBCANo. 60666 and consolidatedwith ASBCANo. 60323.
18. On 28 July 2016, the government filed a motion to dismiss ASBCANo. 60666.
19. On 12 August 2016, appellant filed an amended complaint. In its amended complaint, appellant statedthat it "is entitled to the anticipatory margin and profit associated withthe aggregate amount ofcontracts and purchases made outside ofthe designated PL [ProcurementList], which amount is $28,431,350." (Am. compl. 

### iii! 65-67)
20. On 29 August 2016, appellant filed its response to the government's motion to dismiss. 21. On 21 October 2016, the government filed its reply briefin support ofits motion to dismiss. DISCUSSION
The government challenges the Board'sjurisdictionto entertainASBCANo. 60666 on three grounds: (1) thatthe CO never issued a final decision as to appellant's claim; (2) that appellant's claim fails to state a sum certain; and (3) that appellant's claim fails to state a claim on which reliefmay be granted. Becausethe threshold issue regarding our jurisdictionbegins with the filing ofa claim with the CO, wewill first address whether appellant's 11April2016 submittal constituted a claim as defined by the contract, applicable regulations, and case law. Appellant's Claim Fails to State a Sum Certain Ourjurisdictionunderthe CDA is predicatedupon the filing ofa claim by one of the contractingparties, 41 U.S.C. § 7103(a). The CDA does not define "claim,"butthe Federal Acquisition Regulation (FAR) does so. FAR2.101 states in pertinentpart as follows:

5Claim means a written demand orwritten assertionby one ofthe contracting parties seeking, as a matter ofright, the paymentof money in a sum certain, the adjustment or interpretation ofcontract terms, or otherreliefarising under orrelating to the contract. However, a written demand or written assertion by the contractor seeking the payment of money exceeding $100,000 is not a claim under the Contract Disputes Act of 1978 until certified as required by the Act. [Emphasis added]
This definition of"claim" also is incorporated into appellant's contract as a part ofthe Disputes clause, set forth at FAR 52.233-1, Disputes (SOF**~** 3). The specific issue before us is whether appellant's letterto the CO, dated 11 April 2016, asserts a claim in a "sum certain" in accordance withthis definition. Ifit does not, appellant has not asserted a proper claim, and we do notpossessjurisdiction.
Attachment 60 to appellant's submittal states that appellant seeks total reimbursement in the amount of$295,892.88 plus an amount "TBD" (SOF**~** 10). The specific dollar figure of$295,892.88 is the sum ofthe amounts for retention bonuses for Melwood employees ($114,000), IT subcontracts with Thompson Gray & Corsica ($130,985), plus a markup of20.78 percent onboth ofthose amounts ($50,907.88) (id.). In contrast, the component ofappellant's request for lostprofits associated with services procured from vendors otherthan appellant does not set forth a specific dollar amount. Instead, it states thatthe amount is TBD. Appellant admits as much in its response brief: "[t]he only request that does not specify the precise final monetary amount due to Appellant is for the lostprofits" (app. resp. at 5).
While it is true that portions ofappellant's submittal contain specific dollar amounts, the overall claim fails to state a sum certain. We decline to severportions of the claim in orderto maintainjurisdiction overthe portions containing specific dollar amounts. Specifically, inIslands Mechanical Contractor, Inc., ASBCANo. 59655, 17-1 BCA**~** 36,721 at 178,809 (citingEaton ContractServices, Inc., ASBCANo. 52888 etal., 02-2 BCA**~** 32,023, aff'don recon., 03-1 BCA**~** 32,239), we held:
The failure to meetjurisdictional requirements remains even if, as here, the "claims" contain one component...which were stated in a sum certain but the overall "claim" is not. We will not entertain thatportion ofa claim stated in a fixed amount and discard the remainder, as an "entire claim is in a sum certain, or it is not." Thus, ifaportion ofa claim does not contain a sum certain, the submittal to the CO does not meet the definition ofa claim as set forth in the contract (SOF**~** 3) and in FAR2.101.

6Appellant's argument that the amount oflost profits readily is calculable is unavailing. While a claim may be sufficient ifthe amount in dispute can be determined by simple mathematical calculation, this is not such a case. See, e.g., PHIApplied PhysicalSciences, Inc., ASBCA Nos. 56581, 58038, 13 BCA**~** 35,308 at 173,337 ("Although the amount sought was not expressly totaled by appellant, a sum certain total is readily calculable by simple arithmetic."). According to appellant, the amount ofappellant's lost profits can be calculated with "pertinent contractual details, including cost" from the contracts the government entered into with other vendors allegedly in violation ofappellant's contract (app. resp. at 5). Although appellant filed a Freedom ofInformation Act (FOIA) request for these contracts, it states that it "has notbeen successful in obtaining them" (id. at 6). Instead, appellant contends that the government has information in its possession and, therefore, has adequate notice ofthe monetary amount ofappellant's "claim for anticipatory lost profits." Appellant's argument that its anticipated lost profits can be calculated from information in the government's possession is flawed for several reasons. First, appellant has not explained

- in its 11 April 2016 submittal to the CO or its brief

- how the government would make such a calculation. Appellant asserts in its briefthat the government is "familiarwith Appellant's pricing model, includingthe agreed-upon mark-up for Appellant's services." (App. resp. at 7) According to appellant's argument, the government should inferthat it could multiply appellant's mark-up percentage by the aggregate value ofthe contracts that allegedly were diverted from appellant in orderto calculate appellant's anticipated lost profits. Not only mustthis calculation be inferred, the inputs to the calculation also mustbe inferred. Second, appellant's request does not identify the specific contracts that it alleges were diverted from appellant, nor does the request set forth specific dollar amounts for the allegedly diverted contracts. In its submittal, appellant mentions seven contracts, discussed in the chronology set forth in Attachment 1and also mentions an additional eight contracts revealed from FOIArequests. (SOF**~** 11) Appellant states that FGGM MICC awarded these eight contracts during 2011 through 2014 and were worth "over $28,431,350.00" (SOF**~** 12). Appellantthen states that it "seeks the anticipatory profit from these 15 procurement actions described above as well as any othersimilar inappropriate actions not fully disclosed by FGGMMICC at this time" (id.). These statements demonstrate that the amount ofanticipatory lost profits is a moving target and is based on appellant's allegations ofwhat constitutes "inappropriate"procurement actions. It would be impossible for the governmentto speculate as to what contracts appellant considers to be "inappropriate." Moreover, appellant's statements in its briefacknowledge the ambiguity in the calculation ofits lost profits. Specifically, appellant states that its request is based on the amount ofdiverted contracts "inexcess of$28,431,350.00," leaving open the possibility
7that there is some other undisclosed amount that would serve as the basis ofappellant's lost profits claim. (App. resp. at 6) Indeed, ifthe calculation were as straightforward as appellant claims, it could have made the calculation in its request to the CO. Finally, appellant cannot rehabilitate its submittal to the CO by relying on information obtained during discovery (app. resp. at 5-6). While a contractor may properly amend its claim upon learning additional facts pertaining to a valid claim, Tecom, Inc. v. UnitedStates, 732 F.2d 935, 938 (Fed. Cir. 1984), it cannot later furnish a sum certain to "rehabilitate" an invalid claim orportion thereof. Northrop "Grumman, 10-2 BCA

## ii 34,517 at 170,233 (citing Eaton, 02-2 BCA

## ii 32,023 at 158,266-67). The sufficiency ofa claim is determined at the time it is submitted to the CO; ifit was improperly made, the Board lacksjurisdiction. Id.
In summary, because Melwood's submittal to the CO in ASBCA No. 60666 is not stated as a sum certain, it does not meet the definition ofa claim and, as such, we lack jurisdiction to entertain the appeal. CONCLUSION
Forthese reasons, we grant the government's motion to dismiss.
Dated: 7 June 2017

I concur

RICHARD SHACKLEFORD Administrative Judge Acting Chairman Armed Services Board ofContractAppeals

8 I concur

OWEN C. WILSON Administrative Judge Acting Vice Chairman Armed Services Board ofContractAppealsI certify that the foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContractAppeals in ASBCA No. 60666, Appeal ofMelwood Horticultural Training Center, Inc., rendered in conformance with the Board's Charter.
Dated:

9 JEFFREY D. GARDIN Recorder, Armed Services Board ofContract Appeals