ARMED SERVICES BOARD OF CONTRACTAPPEALS Appeal of

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BAE Systems Land & Armaments Inc.
Under ContractNo. W56HZV-07-C-0660
APPEARANCES FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ) ) ) ) ) ASBCA No. 59374

BarbaraA. Duncombe, Esq. Suzanne Sumner, Esq.

Taft Stettinius & Hollister LLP Dayton, OH
John G. Horan, Esq. Justin M. Ganderson, Esq.

McKenna Long & Aldridge LLP Washington, DC Raymond M. Saunders, Esq.

Army ChiefTrial Attorney CPT Tyler L. Davidson, JA Robert B. Neill, Esq.

Trial Attorneys
OPINIONBYADMINISTRATIVE JUDGE NEWSOM ONAPPELLANT'S MOTION TO COMPEL THE GOVERNMENT TO FILE A COMPLAINT
Beforethe Board is appellant's motion to compel the government to file the complaint in this appeal. The government opposes. For the reasons explained below, the Board grants appellant's motion. The government is directed to file the complaint
no laterthan 30 days following the date ofthis decision.
STATEMENTOF FACTSFORPURPOSES OF THEMOTION
This dispute arises from the government's award ofContract No. W56HZV-07-C-0660 (contract) to BAE Systems Land & Armaments Inc. (BAE Systems or appellant). The contract was a firm-fixed-price contractto produce parts for a military vehicle. (R4, tab 1) BAE Systems subcontracted with Ibis Tek, LLC, for a portion ofthe work (app. supp. R4, tab 47). The contract required submission ofsubcontractor cost orpricing data and contained clauses for price reductions ifthe data were defective (R4, tab 1at 1, 17).

# I The Defense ContractAudit Agency (DCAA) audited appellant's cost or pricing data and concludedthat the subcontractor's cost orpricing data were defective, i.e.,
were not current, accurate, or complete as required by the Truth in Negotiations Act, 10 U.S.C. §2306a. DCAArecommended aprice reduction (R4, tab 3 at 1-2). On 14 May 2013, the contracting officer issued a "DefectivePricing DemandLetter" seeking debt recoupment for the alleged defective pricing identified inthe DCAA audit reports. The letter did not state that it was a contracting officer's final decision, nor did it include contractor appeal rights. (R4, tab 22) On 30 July 2013, BAE Systems submitted a certified claim "challeng[ing] the Government's price adjustment and demand

...for alleged defective pricing" (R4, tab 29 at 1 ). On 24 March 2014, the contracting officer issued a final decision denying the claim (R4, tab 44 at 1, 4).
BAE Systems filed this appeal from that final decision on or about 20 June 2014 and now requests thatthe Board compel the government to file the complaint. Arguing that its claim is a defense to the government's allegations ofdefective pricing, appellant asserts that the "proceedings will benefit" from greater efficiency ifthe government files the initial pleading and presents the factual and legal underpinnings for its allegations ofdefective pricing. (App. mot. at 5-6) The government acknowledges that Boardproceedings may be facilitated ifthe government filed a complaint with regard to its defective pricing contentions. Itasserts, however, that this appeal also includes a contractor claim, and advises that "appellant is in a far betterposition to provide the underlying basis ofits own claim" (gov't opp'n at 3).
DECISION
Under the unique procedural requirements ofthe Contract Disputes Act (CDA), all claims, whether contractor or government claims, mustbe the subject ofa contracting officer's final decision. 41 U.S.C. § 7103. The contractor, however, is the only party who may initiate proceedings at the Board, 41 U.S.C. § 7104, and Board Rule 6(a) requires the appellant to file the complaint in an appeal. Ifthe contractor appeals from a final decision on a government claim, the contractor typically presents in the complaint enough information about the government claim to form a sufficient predicate for its response.
In appropriate cases, the Board may exercise its discretion to direct the government to file the complaint, ifdoing so will facilitate efficientresolution ofthe appeal. BeechcraftDefCo., ASBCANo. 59173, 14-1BCAii35,592;LGTCorp., ASBCA No. 44066, 93-3 BCAii 26,184. Such situations can arise ifrelevant information concerning the basis for the claim resides withthe government, and not the appellant. InBeechcraft, for example, the contractor appealed from a government claim alleging that the contractor was noncompliant with the Cost Accounting Standards (CAS). Observing that the governmentbears the burdento prove a CAS violation and the government was "fully conversant with its own claim," the Board found

2that theproceedings would benefit from the government setting forth, in an initial pleading, the facts and rationale for its determination ofCAS noncompliance. 14-1 BCA 

### if 35,592 at 174,395; see also, e.g., RO. VlB. SrL, ASBCANo. 56198, 09-1 BCA 

### if 34,068 (ordering governmentto file initial pleading in appeal from default termination); HughesAircraft Co., ASBCANo. 46321, 94-2 BCA

### if 26,801 (ordering government to file complaint in appeal involving allegations ofdefective pricing). We do not always direct the governmentto file a complaint in appeals from government claims. Where, for example, the contractor uniquely possessedrelevant information about the claim and proceedings would not have been aided by the government filing the initial pleading, we declined to orderthe government to file the complaint. See GeneralDynamics Corp., ASBCANo. 49339, 96-1 BCA

### if 28,244.
This motionpresents a twist onBeechcraft, in that the contractor is appealing from the denial ofa contractor claim, not a government claim, and yet still seeks an order compelling the governmentto file the complaint. Appellant argues that its claim "relates tothe Government's defective pricing claim" for which the government bears the burden ofproof, the government is in the bestpositionto set forth the facts and legal arguments to support its defective pricing allegations, andthe "proceedings will benefit" from greater efficiency (app. mot. at 4-5).

We agree. Appellant's claim appears to be a defense against the government's allegations ofdefectivepricing, not a separate claim for contract adjustment (R4, tab 29 at 11, Conclusion). Indeed, the Board and the parties are in this unusual posture because the government did not issue a final decision finding defectivepricing except in response to the contractor's claim. Moreover, the contracting officer's final decision does not explain in any depth why it rejectedthe contractor's arguments, except with occasional summary remarks (R4, tab 44). In these particular circumstances, proceedings would be more efficient ifthe Board could start with a government articulation ofthe basis for its determination ofdefective pricing, rather than appellant's speculation about the basis for the government's assertions.

Boththe government defective pricing allegations and the contractor's claim appear to spring from the same set ofoperative facts. This should alleviate the government's concern abouthaving to articulate the underlying basis for the contractor's claim (app. mot. at 3). In any event, the government should only assert the underlying basis for its defectivepricing allegations and is not required to plead the contractor's defenses. The appellant should do that in its answer.

3CONCLUSION
The Board grants appellant's motion to compel the governmentto file the complaint in this appeal. The government is directed to file the complaint no laterthan 30 days following the date ofthis order. The government should assert the underlying basis for its defective pricing allegations. Appellant's answer shall be due 30 days after receipt ofthe government's complaint.
Dated: 18 November 2014

I concur

# ~~# Administrative Judge Acting Chairman Armed Services Board ofContractAppeals Administrative Judge Armed Services Board ofContract Appeals

RICHARD SHACKLEFORD Administrative Judge Vice Chairman Armed Services Board ofContractAppeals

I certifythatthe foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContract Appeals in ASBCA No. 59374, Appeal ofBAE Systems Land & Armaments Inc., rendered in conformance with the Board's Charter.
Dated:

4 JEFFREYD. GARDIN Recorder, Armed Services Board ofContractAppeals