Court Opinion

ID: 4468032
Source: CourtListenerOpinion
Date Created: 2019-12-27 17:00:37.321722+00
Date Added: 2024-06-11T14:35:18.073148
License: Public Domain

United States Court of Appeals
      for the Federal Circuit
                ______________________

     DAI GLOBAL, LLC, FKA DEVELOPMENT
            ALTERNATIVES, INC.,
                  Appellant

                           v.

  ADMINISTRATOR OF THE UNITED STATES
AGENCY FOR INTERNATIONAL DEVELOPMENT,
                  Appellee
           ______________________

                      2019-1330
                ______________________

   Appeal from the Civilian Board of Contract Appeals in
Nos. 5942, 5943, 5944, 5945, 5946, Administrative Judge
Jonathan D. Zischkau, Administrative Judge Catherine B.
Hyatt, Administrative Judge Jeri Kaylene Somers.
                ______________________

              Decided: December 27, 2019
                ______________________

    JONATHAN    DAVID   SHAFFER,    Smith,    Pachter,
McWhorter, PLC, Vienna, VA, argued for appellant. Also
represented by ARMANI VADIEE; TODD MATTHEW GARLAND,
ZACHARY DAVID PRINCE, Tysons Corner, VA.

    GEOFFREY MARTIN LONG, Commercial Litigation
Branch, Civil Division, United States Department of Jus-
tice, Washington, DC, argued for appellee.          Also
2                 DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID

represented by JOSEPH H. HUNT, ROBERT EDWARD
KIRSCHMAN, JR., PATRICIA M. MCCARTHY.
                ______________________

    Before MOORE, SCHALL, and TARANTO, Circuit Judges.
MOORE, Circuit Judge.
    DAI Global, LLC (DAI), formerly known as Develop-
ment Alternatives, Inc., appeals a decision by the Civilian
Board of Contract Appeals (Board) dismissing DAI’s five
appeals for lack of jurisdiction. See Developmental Alts.,
Inc. v. Agency for Int’l Dev., CBCA No. 5942, CBCA 5943,
CBCA 5944, CBCA 5945, CBCA 5946, 18-1 BCA ¶ 37147.
Because the Board has jurisdiction to consider DAI’s ap-
peals, we reverse and remand.
                       BACKGROUND
    From 2006 to 2010, the United States Agency for Inter-
national Development (USAID) awarded DAI five con-
tracts for developmental services in Afghanistan. DAI
subcontracted with a private security company, ERSM (Af-
ghanistan) Limited, d/b/a Edinburgh International (EI). EI
employed over 1,000 individuals to provide DAI with secu-
rity services. On April 1, 2011, Afghanistan imposed a
nearly $2 million fine on EI based on the size and composi-
tion of EI’s private security workforce. EI paid the fine and
allocated a portion of the expense to each of DAI’s five con-
tracts.
    On May 10, 2017, DAI submitted a cover letter and EI’s
five claims to USAID, seeking reimbursement for the fine.
DAI’s cover letter characterized itself as a certification.
Along with each claim, DAI also included EI’s certification
stating that the claim was made in good faith. On July 10,
2017, USAID’s contracting officer sent DAI a letter stating
that she would provide a decision on the claims by August
24, 2017. On July 19, 2017, 70 days after DAI submitted
its claims, the contracting officer sent a second letter
DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID                     3

informing DAI that the submission did not contain a con-
tractor certification.
    On November 20, 2017, DAI filed five notices of appeal
with the Board. The Board dismissed DAI’s claims on Sep-
tember 27, 2018, for lack of jurisdiction based on DAI’s fail-
ure to certify the claims. The Board stated that DAI’s May
10, 2017 certification bears no resemblance to the required
statutory language. The Board also stated that only tech-
nical errors are correctable, and that DAI made its certifi-
cation with reckless disregard for the certification
requirements. It concluded that nontechnical mistakes in
the certification and DAI’s recklessness rendered DAI’s
purported certification unsalvageable. DAI appeals. We
have jurisdiction under 28 U.S.C. § 1295(a)(10).
                         DISCUSSION
    We review a contract board’s decision on a question of
law de novo. Agility Logistics Servs. Co. KSC v. Mattis, 887
F.3d 1143, 1148 (Fed. Cir. 2018). Whether a contract board
has jurisdiction over an appeal is such a question. Id.
    A government contractor seeking payment on a govern-
ment contract must submit a claim to the contracting of-
ficer. 41 U.S.C. § 7103(a)(1). When the claim is for more
than $100,000, an individual authorized to bind the con-
tractor must certify that:
    (A) the claim is made in good faith;
    (B) the supporting data are accurate and complete
    to the best of the contractor’s knowledge and belief;
    (C) the amount requested accurately reflects the
    contract adjustment for which the contractor be-
    lieves the Federal Government is liable; and
    (D) the certifier is authorized to certify the claim on
    behalf of the contractor.
4                  DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID

Id. § 7103(b)(1). 1 However, “[a] defect in the certification
of a claim does not deprive a court or an agency board of
jurisdiction over the claim.” Id. § 7103(b)(3). Rather, when
a certification is “defective,” the “court or agency board
shall require a defective certification to be corrected.” Id.
    DAI argues that the Board erred in dismissing its ap-
peals for lack of jurisdiction based on nontechnical defects
and reckless or negligent disregard for the certification re-
quirements. Appellant’s Br. at 16–19. We agree. Contrary
to the Board’s statement of the law, there is no statutory
requirement that a defect in a certification be merely “tech-
nical” to be correctable. See Developmental Alts., Inc.,
CBCA 5942 at 8. Nor is there a statutory basis for finding
a defective certification uncorrectable based on “inten-
tional, reckless, or negligent disregard for the applicable
certification requirements.” See id. In reaching the oppo-
site conclusion, the Board relied on the text of an unen-
acted version of the governing statute, which passed only
in the Senate:
    If the certification of a claim pursuant to this Act is
    technically defective, a court or agency board of
    contract appeals may permit the certification to be
    corrected at any time prior to a final decision by the
    court or agency board of contract appeals unless the

    1   The particular language required to certify a claim
is prescribed by regulation:
    I certify that the claim is made in good faith; that
    the supporting data are accurate and complete to
    the best of my knowledge and belief; that the
    amount requested accurately reflects the contract
    adjustment for which the contractor believes the
    Government is liable; and that I am duly author-
    ized to certify the claim on behalf of the contractor.
48 C.F.R. § 33.207(c).
DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID                   5

    failure properly to certify in the first instance was
    fraudulent, in bad faith, or with reckless or grossly
    negligent disregard of the requirements of the rele-
    vant statutes or regulations.
138 Cong. Rec. 21,033, 21,036 (1992) (emphasis added).
The House removed the italicized language from the legis-
lation prior to its vote. Id. at 31,172, 31,174. The Senate
adopted the House version and it was signed into law. Id.
at 33,632, 33,635.
    The statute, as enacted, mentions only “defective certi-
fication[s]” without reference to the technical nature of the
defect or mens rea. See 41 U.S.C. § 7103(b)(3). It is axio-
matic that a statute should not be read to implicitly include
language specifically rejected by Congress. I.N.S. v.
Cardoza-Fonseca, 480 U.S. 421, 442 (1987). The Board’s
statement to the contrary, declaring the differences to be
irrelevant, is erroneous and inconsistent with the plain
language of the statute itself. See Developmental Alts.,
Inc., CBCA 5942 at 9 n.3 (citing Engineered Demolition,
Inc. v. United States, 60 Fed. Cl. 822, 828–29 (2004)). We
hold that § 7103(b)(3) does not limit defects to those that
are technical in nature nor does it limit a contractor’s right
to correct a defect if the initial certification was made with
“intentional, reckless, or negligent disregard for the appli-
cable certification requirements.” See id. at 8.
    The plain language of the statute that “[a] defect in the
certification of a claim does not deprive a court or an agency
board of jurisdiction over the claim” requires that we re-
verse the contract board’s contrary conclusion. The con-
tract board erred in its statutory interpretation regarding
a defective certification.
    DAI argues that its May 10 submission to USAID con-
tained a defective certification. Appellant’s Br. at 11–16.
Under a proper reading of the statute, DAI is correct that
its submission constitutes a defective certification. The
May 10, 2017 cover letter conveys a clear intent to certify
6                  DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID

the underlying claims and expressly states that it is an at-
tempt to comply with the Contract Disputes Act:
    As DAI believes there is a sound basis for these
    claims, we are sponsoring these . . . certified claims.
    [EI], DAI’s Security Service Provider, was not able
    to receive an exemption to the five-hundred-person
    [c]ap imposed by the changes in the local laws of
    [Afghanistan]. Therefore, [EI] incurred the result-
    ing fines during [its] performance under the above-
    referenced awards.
    Given that [EI] is the real party in interest and is
    the only one who can logically and realistically cer-
    tify these claims, DAI hereby submits this certifi-
    cation in satisfaction of the requirements of the
    Contract Disputes Act. As DAI is not the real party
    in interest, DAI must accept and rely on the [EI]
    certification at face value. In addition, DAI has no
    knowledge, which suggests that [EI] has knowingly
    or intentionally failed to comply with the require-
    ments of the Contract[] Disputes Act or has acted
    in bad faith.
J.A. 29. EI’s certifications, which mirror the certification
language required by 48 C.F.R. § 33.207(c), further evi-
dence an intent to certify the claims:
    I certify that the claim is made in good faith; that
    the supporting data are accurate and complete to
    the best of my knowledge and belief; that the
    amount requested accurately reflects the contract
    adjustment for which the subcontractor believes
    DAI and the Government to be liable; and that I am
    duly authorized to certify the claim on behalf of the
    subcontractor.
DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID                    7

See, e.g., J.A. 47. Taken together, these documents are suf-
ficient to constitute a defective certification within the
meaning of § 7103(b)(3). 2
     A contracting officer must, within 60 days of receiving
a submitted certified claim, issue a decision or notify the
contractor of the time within which a decision will be is-
sued. 41 U.S.C. § 7103(f)(2). If the contracting officer fails
to issue a decision in the specified time, the claim is deemed
denied and becomes appealable to the Board.                 Id.
§§ 7103(f)(5), 7105(e)(1)(B). The contracting officer is re-
lieved of the obligation to issue a decision, however, if
“within 60 days after receipt of the claim, the contracting
officer notifies the contractor in writing of the reasons why
any attempted certification was found to be defective.” Id.
§ 7103(b)(3).
     It is undisputed that the contracting officer failed to
notify DAI of the defect within the statutory period. Appel-
lee’s Br. at 28. DAI submitted its claims on May 10, 2017
and did not receive notice of the defect until July 19, 2017,
more than 60 days after DAI filed its claim. The contract-
ing officer was therefore required to issue a decision on
DAI’s claims. See 41 U.S.C. §§ 7103(f)(2), (b)(3). But the
contracting officer failed to do so. Because the contracting
officer failed to issue a decision within the statutory period,
DAI’s claim was deemed denied and became appealable to
the Board. 41 U.S.C. §§ 7103(f)(5), 7105(e)(1)(B).
                        CONCLUSION
     Because the Board has jurisdiction over DAI’s appeals
of its deemed denied claims, we reverse the Board’s deci-
sion and remand for further proceedings.
             REVERSED AND REMANDED

    2    We do not decide whether DAI’s May 10, 2017 cover
letter alone constitutes a “defective certification.”
8                 DAI GLOBAL, LLC v. ADMINISTRATOR OF USAID

                          COSTS
    Costs to appellant.