ARMED SERVICES BOARD OF CONTRACTAPPEALS Appeal of

-- ) ) Bell Helicopter Textron Inc. and )

The Boeing Company ) ) Under ContractNos. NOOO 19-96-C-0054 ) NOOO 19-99-C-l090 ) N00019-05-C-0002 ) NOOO 19-06-C-0292 ) NOOO 19-07-C-OOO 1 ) APPEARANCES FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ASBCANo. 59561

Justin M. Ganderson, Esq Frederic M. Levy, Esq.

Covington & Burling LLP Washington, DC Ronald J. Borro, Esq.

Navy ChiefTrial Attorney Richard A. Gallivan, Esq.

Assistant Director David L. Koman, Esq.

Senior Trial Attorney OPINION BYADMINISTRATIVE JUDGE O'CONNELL ON DEEMED GOVERNMENT MOTION TO DISMISS FORLACK OF JURISDICTION

The Board requested briefing in response to an affirmative defense in which the government challenged the Board'sjurisdiction. In its brief, the government questions the authority ofthe person who certified the claim and contends thatthe appeal should have been brought by "Bell Boeing Joint Project Office" and not by the two entities listed above. We have treated the government's briefas a motion to dismiss for lack of jurisdiction. Forthe reasons set forth below, we deny the motion. STATEMENT OF FACTS (SOF) FORPURPOSES OF THEMOTION The Contracts 1. This appeal involves five contracts to fabricate Multi-Purpose, Vertical(MV)-22 Osprey aircraft (and on some contracts the Air Forcevariant, the Cargo) as follows:

7 June 1996

31 March 1999

24 January 2005 Contractor ContractNo. Bell-Boeing Joint Program Office N00019-96-C-0054 (Contract 0054) (R4, tab 1 at 3) Bell-Boeing Joint Program Office N00019-99-C-1090 (Contract 1090) (R4, tab 6 at 578) Bell Boeing Joint Project Office N00019-05-C-0002 (Contract 0002) (R4, tab 15 at 1165) 28 December 2005 Bell Boeing Joint Project Office N00019-06-C-0292 (Contract 0292) (R4, tab 32 at 2432) 2 April 2007 Bell Boeing Joint Project Office N00019-07-C-0001 (Contract 0001) (R4, tab 59 at 3058) The Bell-BoeingBusinessRelationship 2. On 18 December 1995 (about six months before execution ofthe first ofthe five contracts at issue), Bell Helicopter Textron Inc. (Bell Helicopter) and The Boeing Company, Defense & Space Group (Boeing), (collectively Bell Boeing) entered into a jointventure agreement for the V-22 program (gov'tbr., ex. 2). The agreement stated that the parties had entered into a teaming agreement back in 1982 with respect to the JVXprogram, which is nowknown as the V-22 program (id. at 1). The teaming agreement hadbeen amended several times overthe years (id.). 3. Paragraph F ofthe "RECITALS" section ofthejointventure agreement statedthatthe parties had characterized their relationship underthe teaming agreement as a partnership for federal income taxpurposes and had agreed to continue to do so (gov'tbr., ex. 2 at 1 ). 4. Article three ofthejointventure agreement, "INTERESTS OF JOINT VENTURE PARTIES,"provided that work wouldbe performed on V-22 contracts so as to maintain an "equal (50/50) division ofwork" and thatthe parties would share

2equally all aspects of jointventure activity, including profits and losses (gov'tbr., ex. 2 at 4). 5. Article 14 ofthe agreement, "CONTRACTINGAUTHORITY,"provided that all proposals should state that the award ofany V-22 contract should be to the "Bell-Boeing Tiltrotor Team" (gov'tbr., ex. 2 at 33). However, as we have found (SOF**~** 1), none ofthe contracts were actually awarded to Bell-Boeing Tiltrotor Team. The proposals are not in the record; it is not clearwhy the contracts were awarded to Bell-Boeing Joint Program Office and Bell Boeing Joint Project Office. Modification No. P00318 to Contract 0054 identified the contractor as Bell Boeing Tilt Rotor Team (R4, tab 4), but this appears to have been an exception. 6. On or about 22 August 2006 (after the fourth but before the fifth contract listed above), Bell and Boeing entered into a "STRATEGIC ALLIANCE AGREEMENT" (SAA) which, as appellants put it in theirbrief, supersededthejoint venture agreement (gov't br., ex. 11). After referencing the December 1995joint venture agreement, the opening paragraph ofthe SAA stated "This Agreement is converted from ajointventure agreementto a Strategic Alliance Agreement and consolidated to include all amendments to thejointventure agreement as ofthe 11th day ofAugust, 2006

..." (id at 4). 7. The original SAA, like thejointventure agreement, stated that all contracts would be awarded to the Bell Boeing Tiltrotor Team (gov't br., ex. 11 at 39). However, amendment one to the SAA stated that contracts would be awarded to the Bell Boeing Joint Project Office (id. at 40, article 14.1). The date ofamendment one is not in the record. 1 8. Just as in thejointventure agreement, paragraph F ofthe SAA recitals stated that the parties would continue to characterize theirrelationship as a partnership for federal income taxpurposes (gov'tbr., ex. 11 at 5). However, amendment two to the SAA stated that as of 1January 2010 (more than two years after award ofthe last of the five contracts), the SAA would no longerbe considered a partnership for federal taxpurposes and that eachparty would be responsible for reporting the appropriate revenue and costs for the agreement on its own corporate income tax return (id. at 20, article 6.2.2). The date ofSAA amendment two is not in the record. 9. Similar to thejointventure agreement, the SAA emphasized that, unless

1The government filed a conformed copy ofthe SAA that indicates language added or stricken by amendments butnot the amendment dates.

3stated otherwise, everything would continue to be "50/50" and that: [T]he Parties shall share equally all aspects ofthe Strategic Alliance activity including profits and losses, Allowable Costs, fees paidby Customers, expenses, taxable income or loss and tax credits, and other obligations and liabilities incurred in the furtherance ofStrategic Alliance work. (Gov'tbr., ex. 11 at 9, article 3.1-3.2) 10. Amendment one to the SAA added the following sentence to article 14, Contracting Authority: "TheParties intend to act in any contract covered by this Agreement as dual primes"2 (gov't br., ex. 11 at 40). As stated above, the record does not reveal the date ofamendment one but a 28 August 2009 memorandum from the Defense ContractAudit Agency indicates that the government knew ofthe dual prime arrangement by that date (app. resp., ex.Bat 1). 11. There is no evidence in the record thatthe contracting officer novated any ofthe contracts from ajointventure to a dual prime arrangement. ActionsRelating to Claim Certification 12. In March and April 2012, Bell, through its Executive Vice President Programs, and Boeing, through its Vice President and General Manager, Mobility Division, executed a power ofattorney that granted a number ofindividuals, including James Ariail and William Reis, the powerto negotiate and execute "bids

...contracts, contract modifications, change orders, certificates

...and similar documents." Further, it grantedthem authority toperform "every act whatsoever requisite or necessary to be done in or about the exercise ofthe powers and authority" granted. (App. resp., ex. C at 1) 13. These same representatives ofBell and Boeing also issued a "SPECIAL INSTRUCTION CONCERNING POWEROF ATTORNEY"toMr. Ariail. This document instructed Mr. Ariail not to exercise his power ofattorney "unless the terms and conditions to be signedhave been subjected to a coordinated review as to their content acceptability and legal sufficiency" and approved by both Bell and Boeing. (App. resp., ex. C. at 5)

2 Article two ofthe SAA, Formation, Name and Places ofBusiness, states that the SAA applies to all contracts entered into by the parties after 22 October 1992 (gov'tbr., ex. 11 at 6).

414. On 17 April 2013, appellants submitted a certified claim for more than $8 million. They submitted the claim on letterhead that stated "Bell Boeing The Tiltrotor Team" at the top and "Bell Boeing V-22 Joint Project Office" at the bottom. (Gov'tbr., ex. 14) Appellants referred to themselves as "Bell Boeing" in the cover letter. In the body ofthe claim, they identified each company by its corporate name and thereafterreferred to themselves as "Bell Boeing" (R4, tab 79 at 4626). 15. James Ariail certified the claim. He stated in relevant partthat the claim "accurately reflects that contract adjustment for which Bell Boeing believes the Government is liable; and that I am duly authorized to certify the claims on behalfof Bell Boeing." (Gov'tbr., ex. 16) The contracting officer denied the claim on 17 June 2014 (R4, tab 84). The first page ofthat decision refers to the contractor as both "Bell-Boeing Joint Program Office" and "Bell Boeing Joint Project Office" and thereafterrefers to them (or it) as "Bell Boeing" (id.). 16. Appellants have provided the Board with a series ofemails exchanged between Bell and Boeing employees on 10 April 2013, one week before claim submission. In general, these emails indicate that representatives ofboth companies reviewed the claim. In the penultimate email inthis chain, Mr. Reis, Boeing's Senior Manager V-22 Contracts, Pricing and Estimating, informed Mr. Ariail that the claim was "Goodto go." (App. resp., ex. D at 1, Reis decl.**~** 2) 17. Both Mr. Reis and Mr. Ariail submitted declarations. Inhis declaration, Mr. Reis testified that hereviewed and provided comments onthe claim and approved Mr. Ariail's certification and its submission to the contracting officer (app. resp., Reis decl.**~** 3). Mr. Arial testified that he was at that time "Manager US Contracts (V-22)" for Bell and had authority to certify the claim on behalfofBell (app. resp., Ariail decl.**~~** 2-4). 18. On 15 September 2014, appellants filed this appeal listing the full name of each corporation as appellants, as identified in the caption above. Mr. Ariail testified that he coordinated review ofthe notice ofappeal with Boeing and that both companies approved filing ofthe notice ofappeal (app. resp., Ariail decl.**~** 6). Mr. Reis confirmed in his declaration that he concurred in the filing ofthe notice of appeal (app. resp., Reis decl.**~** 4). DECISION The government challenges Mr. Ariail's authority to certify the claim on behalf ofthe appellants, which the government contends was ajoint venture at all times. The government also contends that the appeal should have beenbrought by Bell Boeing Joint Project Office. In the government's view, both issues may deprive the Board of jurisdiction. We will considerthese contentions in turn.

5The Authority of JamesAriail to Certify the Claim The ContractDisputes Act (CDA) has been amended several times over the years but the provisions relevant to claim certification have remained consistent from June 1996, when the parties entered into the first ofthe contracts at issue, until today. Contractor claims must be submitted to a contracting officer and claims over $100,000 must be certified. 41 U.S.C. 

### § 7103(a)(l), (b). The certification "may be executed by an individual authorized to bind the contractor with respect to the claim." Id., 

### § 7103(b)(2). Federal Acquisition Regulation (FAR) 33.207(e) clarifies that the certification may be executed "by any person duly authorized to bind the contractor with respect to the claim." The Board cannot entertain an appeal ifthe claim is not certified. AlRafideen Co., ASBCANo. 59156,**15-1BCA~35,983.** We possessjurisdiction ifthere is a certification that contains a defect, but it must be corrected before we can enter final judgment. 41 U.S.C. 

### § 7103(b)(3). Given this distinction, the question at hand is whether a certification that lacked authority is tantamount to no certification at all, or whether it is merely a defective certification. The answer is that it is clearly the latter. A "defective certification" is defined in the FARto include "acertificate

...which is not executed by a person duly authorized to bind the contractor with respect to the claim." 48 C.F.R. § 33.201. Accordingly, we possessjurisdiction even ifMr. Ariail lacked authority to certify the claim. We will examine Mr. Ariail's authority solely to determine whether Bell Boeing needs to file a corrected certification. The government makes two contentions in its opening briefconcerning Mr. Ariail's authority to certify the claim. First, it contends that "Mr. Ariail by signing on behalfof'Bell Boeing' appears to only be signing on behalfofBell Helicopter Textron Inc. and not Bell Boeing Joint Project Office" (gov'tbr. at 10). The apparent source ofthis somewhatpuzzling contention is not the certification (which refers to "Bell Boeing"three times), butthe coverpage ofthe claim (gov't br., ex. 15), which, appellants concede, has a typographical error (app. resp. at 7,**~** 9 n.5). While the first sentence ofthe executive summary ofthe claim states thatBell Helicopter and Boeing are "collectively known as 'Bell Boeing,"' (R4, tab 79 at 4626), the coverpage omits the words "collectively known as" (gov't br., ex. 15). Thus, although not spelled out in the government's brief, the government appears to read the cover page to define "Bell Boeing" as only Bell. We do not agree that the coverpage created any serious confusion. The executive summary makes it abundantly clear that "Bell Boeing" refers to both companies. Second, the government contends that article 14.2 ofthe SAArequired Mr. Ariail (aBell employee) to have prior written approval from Boeingbefore he certified the claim. That article provides that "NeitherParty hereto shall execute

6Proposals, Contracts, modifications thereto, or other contractual instruments in the name ofand on behalfofthe Strategic Alliance without the prior written approval of the other Party" (gov't br., ex. 11 at 41). The government assumes that a claim certification is a proposal, contract, modification, or other contractual instrument. However, we conclude that the power ofattorney and the special instruction directly speakto Mr. Ariail's authority to issue certificates (SOF ,, 12-13). These documents gave Mr. Ariail the authority to issue certificates as long as he engaged in coordinated review with Boeing. (The government does not contend that the Bell and Boeing officials who issued the power ofattorney lackedthe authority to do so.) We find that the emails Mr. Ariail exchanged with Mr. Reis, which concluded with Mr. Reis stating thatthe claim was "Goodto go" (SOF ,, 16-17), as amplified by the testimony in the Reis andAriail declarations, are convincing evidence that Mr. Ariail carried out his responsibilities in accordance with the power ofattorney and spe'cial instruction. Tobe fair, the government did notpossess the 10 April 2013 emails or the Reis andAriail declarations when it filed its opening brief. But, undeterred, the governmentpresses on in its reply brief. Itrejects the sufficiency ofthe Ariail and Reis declarations because they do notprovide contemporaneous documents that demonstrate that both Boeing and Bell approved the claim submission and the certification. (Gov'treply at 4). The government contends that the 10 April 2013 emails are not sufficient for these purposes. We disagree. It suffices to say that the level ofdocumentation that the government is seeking is notrequired by the CDA, the FAR, orthe power ofattorney and special instruction. See SadelmiJoint Venture v. Dalton, 5 F.3d 510, 513 (Fed. Cir. 1993) (relying on affidavits to conclude certifier had authority). Finally, the cases that the government cites are inapposite. We observed above that the CDA certificationrequirements have beenthe same since the parties executed the first contract at issue in 1996. These standards relate backto enactment ofthe Federal Courts AdministrationAct (FCAA) of 1992 on 29 October 1992, which, among otherthings providedthat a defective certification does not deprive the Board of jurisdiction. Pub. L. No. 102-572, § 907(a). Until enactment ofthe FCAA, FAR 33.207(c)(2) restrictedthe categories ofindividuals who could certify claims to: (i) A senior company official in charge at the contractor's plant or location involved; or (ii) An officer or general partner ofthe contractor having overall responsibility for the conduct ofthe contractor's affairs. Becausethese certificationrequirements were both restrictive and viewed to be jurisdictional, they spawned a significant amount oflitigation. For example, in

7Universal Canvas, Inc. v. Stone, 975 F.2d 847, 849-50 (Fed. Cir. 1992), the Federal Circuit heldthatwe lackedjurisdictionto consider an appeal even though the claim had been certified by the contractor's vice president for accounting because he did not meet the section 33.207(c) requirements. Notably, all ofthe opinions that the government cites in its briefs are from this bygone era. For example, in its reply brief, the governmentrelies on Kiewit/Tulsa-Houston v. UnitedStates, 25 Cl. Ct. 110 (1992), which involved a claim and lawsuit filed long before enactment ofthe FCAA. Inthat case, the Claims Court granted the government's motion to dismiss for lack of jurisdiction in part because the certification did not meetthe requirements ofFAR 33.207. Id. at 120-21. The court also based its decision onthe specific language ofthejointventure agreement andthe power ofattorney. Among otherthings, the courtheld that the power ofattorney at issue did not grant the authority to certify claims. Id. at 118-19. We have reached the opposite conclusion based onthe specific language ofthe power ofattorney in this case. In short, Kiewit/Tulsa involves different facts and different law, and is not in any eventbinding upon us. We Construe This AppealAsFiled in the Name of BellBoeingJointProject Office The CDAprovides that "A contractor

...may appeal the [contracting officer's final] decision to an agency board

..." 41 U.S.C. 

### § 7104(a). The CDA defines a contractor as "aparty to a Federal Government contract otherthan the Federal Government." 41 U.S.C. 

### § 7101(7). The government contends that this appeal should have been brought in the name of"Bell-Boeing Joint Project Office," and not by Boeing and Bell Helicopter in their own corporate names (gov't br. at 1). The government does not cite any precedentholdingthat filing in this manner deprives the Board of jurisdiction. As our findings indicate, there is some confusion as to the correct name ofthe contractor and the nature ofthe Bell Boeing business arrangement (SOF 

### iii! 1, 5-8). However, it is clear that Bell Boeingwas ajointventure through the execution date of the first four ofthe five contracts at issue and thatthere is no evidence ofany novation (SOF 

### iii! 6, 15). It is also clearthat the contracting office issued the fifth contractto Bell BoeingJoint Project Office (SOF 

### if 1), which was consistent with the name used on the mostrecent contracts. The contractor did not objectto the issuance ofthe fifth contract by informing the contracting officerthatthe listed name no longerreflected the business relationship between Bell and Boeing. Instead, it signed the contract as issued bythe contracting officer (id.). Finally, it is also clearthat Bell and Boeing both approved the filing ofthis appeal (SOF 

### if 18).



### 8Underthese circumstances, we see no basis to question ourjurisdiction. However, to remain consistent with the requirement in the CDA that the "contractor" file the appeal we will: 1) construe this appeal as having been brought in the name of Bell Boeing Joint Project Office, the named contractor in the last three contracts; and 2) treat Bell Boeing Joint Project Office and Bell-Boeing Joint Program Office as different names for the same entity.CONCLUSION Forthe foregoing reasons, the government's motion is denied. Dated: 16 September 2015

I concur

. MARKN.S

Administrative Judge Acting Chairman Armed Services Board ofContract Appeals

# '/VJA,~cnoc~ MICHAEL N. O'CONNELL Administrative Judge Armed Services Board ofContract Appeals I concur 

# <±:r.··

,, RICHARD SHACKLEFORD Administrative Judge Vice Chairman Armed Services Board ofContractAppeals I certify thatthe foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContractAppeals in ASBCA No. 59561, Appeal ofBell Helicopter Textron Inc. and The Boeing Company, rendered in conformance with the Board's Charter.

Dated:

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