Free Motion to Amend Pleadings - Rule 15 - District Court of Federal Claims - federal

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS YATES INTERNATIONAL, LLC, Plaintiff, v. THE UNITED STATES, Defendant. ) ) ) ) ) ) ) ) )

No. 06-157C (Judge Allegra)

DEFENDANT'S AMENDED ANSWER AND COUNTERCLAIM For its answer to the complaint, defendant admits, denies, and asserts as follows: 1. The allegations contained in paragraph 1 constitute

plaintiff's characterization of its case, to which no response is required; to the extent they may be deemed allegations of fact, they are denied. 2. Defendant denies the allegation contained in paragraph

2, that defendant violated contractual or other obligations; denies the remainder of the allegations contained in paragraph 2 for lack of knowledge or information sufficient to form a belief as to their truth. 3. Denies the allegation contained in paragraph 3 for lack

of knowledge or information sufficient to form a belief as to its truth. 4. 5. Admits. The allegation contained in paragraph 5 constitutes a

conclusion of law, to which no response is required; to the extent it may be deemed an allegation of fact, it is denied.

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6.

Admits the allegations contained in paragraph 6 to the

extent supported by the contracts cited, which are the best evidence of their contents; otherwise denies the allegations contained in paragraph 6. 7. Admits the allegations contained in paragraph 7 to the

extent supported by the contracts cited, which are the best evidence of their contents; otherwise denies the allegations contained in paragraph 7. 8. 9. 10. Admits. Admits. Admits the allegations contained in the first sentence

of paragraph 10 to the extent supported by the contracts cited, which are the best evidence of their contents; otherwise denies the allegations contained in the first sentence of paragraph 10. Admits the allegation contained in the second sentence of paragraph 10. 11. Denies the allegations contained in paragraph 11 for

lack of knowledge or information sufficient to form a belief as to their truth. 12. Admits the allegations contained in paragraph 12 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in paragraph 12.

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13.

Admits the allegations contained in paragraph 13 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in the first sentence of paragraph 13. 14. Admits the allegations contained in paragraph 14 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in the first sentence of paragraph 14. 15. Admits the allegations contained in paragraph 15 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in the first sentence of paragraph 15. 16. Admits the allegation contained in paragraph 16 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegation contained in the first sentence of paragraph 16. 17. Admits the allegations contained in paragraph 17 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in the first sentence of paragraph 17. 18. Admits the allegation contained in paragraph 18 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegation contained in the first sentence of paragraph 18.

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19.

Admits the allegation contained in paragraph 19 to the

extent supported by the modification cited, which is the best evidence of its contents; otherwise denies the allegation contained in the first sentence of paragraph 19. 20. Admits the allegations contained in paragraph 20 to the

extent supported by the modification cited, which is the best evidence of its contents; otherwise denies the allegations contained in the first sentence of paragraph 20. 21. Admits the allegations contained in paragraph 21 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in paragraph 21. 22. Admits the allegation contained in paragraph 22 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegation contained in the first sentence of paragraph 22. 23. Admits the allegations contained in paragraph 23 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise denies the allegations contained in the first sentence of paragraph 23. 24. Admits the allegations contained in paragraph 24 to the

extent supported by the Show Cause Notice cited, which is the best evidence of its contents; otherwise denies the allegations contained in paragraph 24.

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25.

Admits the allegations contained in paragraph 25 to the

extent supported by plaintiff's response to the Show Cause Notice cited, which is the best evidence of its contents; otherwise denies the allegations contained in paragraph 25. 26. Admits the allegation contained in the first sentence

of paragraph 26 to the extent supported by the letter cited, which is the best evidence of its contents; otherwise, denies the allegation contained in the first sentence of paragraph 26. Admits the allegations contained in the second sentence of paragraph 26 to the extent supported by plaintiff's second response to the Show Cause Notice cited, which is the best evidence of its contents; otherwise denies the allegations contained in the second sentence of paragraph 26. 27. 28. Admits. Admits the allegation contained in paragraph 28 to the

extent supported by the Show Cause Notice cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 28. 29. Admits the allegation contained in paragraph 29 to the

extent supported by the Show Cause Notice cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 29. 30. Admits the allegation contained in paragraph 30 to the

extent supported by the Show Cause Notice cited, which is the

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best evidence of its contents; otherwise, denies the allegation contained in paragraph 30. 31. 32. Admits. Admits the allegations contained in paragraph 32 to the

extent supported by the notice of termination cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 32. 33. Admits the allegation contained in paragraph 33 to the

extent supported by the notice of termination cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 33. 34. Admits the allegations contained in paragraph 34 to the

extent supported by the notice of termination cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 34. 35. Denies the allegations contained in paragraph 35 for

lack of knowledge or information sufficient to form a belief as to their truth. 36. Denies the allegations contained in paragraph 36 for

lack of knowledge or information sufficient to form a belief as to their truth. 37. 38. Denies. Admits the allegation contained in paragraph 38 that

DOD/DLA provided plaintiff with photographs of the cylinder

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storage site; denies the remainder of the allegations contained in paragraph 38. 39. 40. 41. Denies. Denies. Denies the allegations contained in paragraph 41 for

lack of knowledge or information sufficient to form a belief as to their truth. 42. 43. Denies. Admits the allegations contained in paragraph 43 to the

extent supported by the electronic mail cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 43. 44. Admits the allegation contained in paragraph 44 to the

extent supported by the request for equitable adjustment cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 44. 45. Admits the allegation contained in paragraph 45, that

in response to plaintiff's claim, DOD/DLA authorized reimbursement to plaintiff for the actual cost, plus 10 percent profit, for removing the rusted caps; denies the remainder of the allegations contained in paragraph 45. 46. Admits the allegations contained in paragraph 46 to the

extent supported by the contracting officer's February 7, 2005 decision, which is the best evidence of its contents; otherwise

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denies the allegations contained in paragraph 46. 47. 48. 49. Denies. Denies. Admits the allegations contained in paragraph 49 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 49. 50. Admits the allegation contained in paragraph 50 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 50. 51. Denies the allegation contained in the first sentence

of paragraph 51 for lack of knowledge or information sufficient to form a belief as to its truth. Denies the allegation

contained in the second sentence of paragraph 51. 52. Admits the allegations contained in paragraph 52 to the

extent supported by the delivery order cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 52. 53. Admits the allegation contained in paragraph 53 to the

extent supported by the request for progress payment cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 53.

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54.

Admits the allegations contained in paragraph 54 to the

extent supported by the requests for progress payment cited, which are the best evidence of their contents; otherwise, denies the allegations contained in paragraph 54. 55. Admits the allegation contained in paragraph 55 to the

extent supported by the modification cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 55. 56. Admits the allegation contained in paragraph 56 to the

extent supported by the written request cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 56. 57. Admits the allegation contained in paragraph 57 to the

extent supported by the written request cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 57. 58. 59. 60. Denies. Denies. Denies the allegations contained in paragraph 60 for

lack of knowledge or information sufficient to form a belief as to their truth. 61. 62. 63. Denies. Denies. Denies.

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64. 65.

Denies. Admits the allegation contained in the first sentence

of paragraph 65 to the extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in the first sentence of paragraph 65. Denies the allegation contained in the second sentence of paragraph 65. 66. 67. 68. Denies. Admits. Admits the allegation contained in paragraph 68 to the

extent supported by the regulations cited, which are the best evidence of their contents; otherwise, denies the allegation contained in paragraph 68. 69. The allegation contained in paragraph 69 constitutes a

conclusion of law, to which no response is required; to the extent it may be deemed an allegation of fact, it is denied. 70. Admits the allegations contained in paragraph 70 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 70. 71. The allegations contained in paragraph 71 constitute

conclusions of law, to which no response is required; to the extent they may be deemed allegations of fact, they are denied.

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72.

Admits the allegation contained in the first sentence

of paragraph 72 that plaintiff contacted DOD/DLA in October 2003 and claimed that the 500 cylinders had to be vented and hydrostatically tested; denies the remainder of the allegation contained in the first sentence of paragraph 72, that plaintiff referred to the European Union transportation regulations. Denies the allegation contained in the second sentence of paragraph 72 for lack of knowledge or information sufficient to form a belief as to its truth. 73. 74. Admits. Admits the allegation contained in paragraph 74 that

DOD/DLA agreed to allow plaintiff to vent, hydrostatically test, and refurbish the cylinders; denies the remainder of the allegations contained in paragraph 74 for lack of knowledge or information sufficient to form a belief as to their truth. 75. Denies the allegation contained in paragraph 75 for

lack of knowledge or information sufficient to form a belief as to its truth. 76. 77. Denies. Denies the allegations contained in the first sentence Admits the allegation contained in the second

of paragraph 77.

sentence of paragraph 77. 78. 79. Denies. Denies.

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80.

Admits the allegations contained in paragraph 80 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 80. 81. Admits the allegations contained in the first and

second sentences of paragraph 81 to the extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in the first and second sentences of paragraph 81. Admits the allegation

contained in the third sentence of paragraph 81 to the extent supported by the option award cited, which is the best evidence of its contents; otherwise, denies the allegation contained in the third sentence of paragraph 81. 82. Admits the allegations contained in paragraph 82 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 82. 83. 84. Admits. Admits the allegation contained in paragraph 84 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 84. 85. Admits.

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86.

Admits the allegation contained in paragraph 86 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 86. 87. Admits the allegations contained in paragraph 87 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 87. 88. Admits the allegation contained in the first sentence

of paragraph 88 that the contracting officer may have told plaintiff that the Refill Contract was "the same as" the National Welders contract in some respects; denies that the contracting officer told plaintiff that the Refill Contract "was the same as the National Welders contract" with respect to the minimum and maximum delivery orders. Admits the allegation contained in the

second sentence of paragraph 88 to the extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in the second sentence of paragraph 88. 89. 90. Admits. Admits the allegation contained in paragraph 90 to the

extent supported by the Show Cause Notice cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 90.

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91.

Admits the allegation contained in paragraph 91 to the

extent supported by the Show Cause Notice cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 91. 92. Admits the allegation contained in paragraph 92 to the

extent supported by the Show Cause Notice cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 92. 93. Admits the allegation contained in paragraph 93 to the

extent supported by the notice of termination referred to, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 93. 94. Admits the allegations contained in paragraph 94 to the

extent supported by the notice of termination cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 94. 95. Admits the allegation contained in paragraph 95 to the

extent supported by the notice of termination cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 95. 96. Admits the allegations contained in paragraph 96 to the

extent supported by the notice of termination cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 96.

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97.

Admits the allegations contained in paragraph 97 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 97. 98. Admits the allegation contained in paragraph 98 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 98. 99. Admits the allegation contained in paragraph 99 to the

extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 99. 100. Admits the allegation contained in paragraph 100 to

the extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 100. 101. Denies the allegation contained in paragraph 101 for

lack of knowledge or information sufficient to form a belief as to its truth. 102. The allegation contained in paragraph 102, that "EU

regulations15 . . . are more stringent than DOD/DLA regulations" constitutes a question of law, to which no response is required; to the extent it may be deemed an allegation of fact, it is denied; admits the remainder of the allegations contained in

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paragraph 102 to the extent supported by the regulations cited, which are the best evidence of their contents; otherwise, denies the remainder of the allegations contained in paragraph 102. 103. 104. Denies. Admits the allegations contained in paragraph 104 to

the extent supported by the memorandum cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 104. 105. Admits the allegation contained in paragraph 105 that,

on or before September 18, 2003, which was before the Refill Contract was awarded, plaintiff notified the contracting officer that contractors in Germany typically use T-carts; denies the remainder of the allegations contained in paragraph 105. 106. Admits the allegations contained in paragraph 106 to

the extent supported by the electronic mail cited, which is the best evidence of its contents; otherwise, denies the allegations contained in paragraph 106. 107. 108. Denies. Admits the allegation contained in paragraph 108 to

the extent supported by the contract cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 108. 109. Admits the allegation contained in the first sentence

of paragraph 109 to the extent supported by the modification

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cited, which is the best evidence of its contents; otherwise, denies the allegation contained in the first sentence of paragraph 109. Admits the allegation contained in the second

sentence of paragraph 109 to the extent supported by the facsimile cited, which is the best evidence of its contents; otherwise, denies the allegation contained in the second sentence of paragraph 109. 110. 111. 112. Denies. Denies. The allegation contained in paragraph 112, that "EU

regulations . . . are typically more stringent than U.S./DOD/DLA regulations" constitutes a question of law, to which no response is required; to the extent it may be deemed an allegation of fact, it is denied; admits the remaining allegation contained in paragraph 112 to the extent supported by the parties' Refill contract, which is the best evidence of its contents; otherwise, denies the remaining allegation contained in paragraph 112. 113. Admits the allegation contained in paragraph 113 to

the extent supported by the regulations cited, which are the best evidence of their contents; otherwise, denies the allegation contained in paragraph 113. 114. 115. Admits. Denies the allegation contained in paragraph 115 for

lack of knowledge or information sufficient to form a belief as

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to its truth. 116. Admits the allegation contained in paragraph 116 to

the extent supported by the regulations cited, which are the best evidence of their contents; otherwise, denies the allegation contained in paragraph 116. 117. 118. 119. 120. 121. 122. 123. 124. Denies. Admits. Denies. Denies. Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 123 of

the complaint are incorporated by reference. 125. 126. 127. 128. 129. Denies. Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 128 of

the complaint are incorporated by reference. 130. 131. 132. 133. Denies. Admits. Denies. Denies.

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134. 135.

Denies. Defendant's responses to paragraphs 1 through 134 of

the complaint are incorporated by reference. 136. The allegation contained in paragraph 136 constitutes

a conclusion of law, to which no response is required; to the extent it may be deemed an allegation of fact, it is denied. 137. The allegation contained in paragraph 137 constitutes

a conclusion of law, to which no response is required; to the extent it may be deemed an allegation of fact, it is denied. 138. Denies the allegation contained in paragraph 138 for

lack of knowledge or information sufficient to form a belief as to its truth. 139. 140. Denies. Defendant's responses to paragraphs 1 through 139 of

the complaint are incorporated by reference. 141. 142. 143. 144. 145. 146. Denies. Denies. Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 145 of

the complaint are incorporated by reference. 147. 148. Denies. Admits.

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149. 150. 151. 152.

Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 151 of

the complaint are incorporated by reference. 153. 154. 155. 156. Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 155 of

the complaint are incorporated by reference. 157. 158. 159. 160. Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 159 of

the complaint are incorporated by reference. 161. 162. 163. Denies. Denies. Defendant's responses to paragraphs 1 through 162 of

the complaint are incorporated by reference. 164. 165. 166. Denies. Denies. Defendant's responses to paragraphs 1 through 165 of

the complaint are incorporated by reference. 167. Denies.

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168. 169.

Denies. Defendant's responses to paragraphs 1 through 168 of

the complaint are incorporated by reference. 170. 171. 172. Denies. Denies. Defendant's responses to paragraphs 1 through 171 of

the complaint are incorporated by reference. 173. 174. 175. Denies. Denies. Defendant's responses to paragraphs 1 through 174 of

the complaint are incorporated by reference. 176. 177. 178. 179. Denies. Denies. Denies. Defendant's responses to paragraphs 1 through 178 of

the complaint are incorporated by reference. 180. 181. Denies. Admits the allegation contained in paragraph 181 to

the extent supported by the electronic mail cited, which is the best evidence of its contents; otherwise, denies the allegation contained in paragraph 181. 182. 183. Denies. Denies.

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184.

Denies that plaintiff is entitled to the relief

requested in its prayer for relief immediately following paragraph 183 or to any relief whatsoever. 185. Denies each and every allegation not previously

admitted or otherwise qualified. AFFIRMATIVE DEFENSES 186. All or part of plaintiff's claims are barred by the

doctrine of accord and satisfaction. 187. All or part of plaintiff's claims are barred by the

doctrine of waiver. DEFENDANT'S COUNTERCLAIM 188. This Court has jurisdiction over these counterclaims

pursuant to 28 U.S.C. §§ 1503 and 2508. 189. The Refurbishment Contract incorporated by reference

FAR clause 52.245-3, "Government Property (Fixed Price Contracts)." 190. The Refill Contract incorporated by reference FAR

clause 52.245-3, "Government Property (Fixed Price Contracts)." 191. FAR § 45.103 states that "[C]ontractors are

responsible and liable for Government property in their possession unless otherwise provided by contract." 192. Yates International, L.L.C. ("Yates") was responsible

for ensuring the safety and security of the cylinders, T-carts, and other Government Furnished Property ("GFP") in its possession

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as a result of its performance of the Refurbishment Contract. 193. Yates was responsible for ensuring the safety and

security of the cylinders, T-carts, and other GFP in its possession as a result of its performance of the Refill Contract. 194. The Refurbishment Contract incorporated by reference

FAR clause 52.249-8, "Default (Fixed-Price Supply and Service)." 195. The Refill Contract incorporated by reference FAR

clause 52.249-8, "Default (Fixed-Price Supply and Service)." 196. Under the Default clause (Fixed-Price Supply and

Service), the contractor is liable to the Government for the excess costs of procuring "supplies or services similar to those terminated." 197. On February 24, 2005, Yates employee Trevor Noble

informed the Government that Yates would abandon its Holland facility on February 25, 2005. 198. facility. On February 25, 2005, Yates abandoned its Holland Yates abandoned in excess of 8,000 cylinders which

were the property of the United States Government, as well as other GFP such as T-Carts, at its Holland facility. 199. When Yates International abandoned its Holland

facility on February 25, 2005, it left debris other than GFP scattered about the facility. 200. Of the empty cylinders discovered in Yates' abandoned On March 1, 2005, Trevor

facility, 2,627 did not have valves.

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Noble, Yates' general manager in Holland, e-mailed the contracting officer that "Jim [Yates] stopped sending over valves for us to fit to the cylinders. These cylinders are fully I beleive [sic] Jim has

refurbished and only miss the valves.

been paid the full $40-00 for these cylinders." 201. On or about March 3, 2005, Yates received a

modification to the Refill Contract, which notified Yates that the contract was terminated for default and that Yates would be liable to the Government for excess reprocurement costs the Government incurred as a result of the termination for default. 202. On or about March 3, 2005, Yates received a

modification to the Refurbishment Contract, which notified Yates that the contract was terminated for default and that Yates would be liable to the Government for excess reprocurement costs the Government incurred as a result of the termination for default. 203. On March 9, 2005, the termination contracting officer The letter noted

sent a letter to Yates about retaining GFP.

that Yates had apparently abandoned its facility and failed to take any action to protect the GFP provided to it under the contracts. The letter further notified Yates that it would be

liable to the Government for any potential losses of GFP. 204. Yates did not return to its Holland facility to secure

the GFP or clean up the facility.

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205.

The Government was forced to expeditiously secure the The Government at the

abandoned GFP and clean the abandoned facility. was also forced to pay for the removal of the GFP facility to its follow-on contractor. 206.

On March 10, 2005, the Government awarded contract

SP0406-05-M-Z791 to Exploitatiemaatschappij Laanweg BV, the owner of the facility and Yates' former landlord, to temporarily provide secure storage for four weeks of the GFP which Yates had abandoned. The Government paid $31,837.41 for the performance of

this contract. 207. On May 3, 2005, the Government awarded contract

SP0406-05-D-4067-001Z to International Gas & Services, NV ("IGS") in Belgium to perform the remainder of the term of the Refill Contract and to complete the Refurbishment Contract. The

contract includes a separate contract line item number ("CLIN") for the removal of the GFP from Yates' abandoned facility to IGS and for cleanup of Yates' Holland facility. The Government paid

$62,901.88 to IGS for services under this CLIN. 208. By letter dated June 29, 2006, the contracting officer

issued a final decision to Yates demanding breach of contract, and termination and reprocurement related costs from Yates in the amount of $127,576.79, plus interest. Exhibit "A."

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COUNT I Reprocurement Costs (Temporary Storage of Government Furnished Property) 209. The Government's requirements to procure services and

supplies under Contract No. SP0406-05-M-Z791 were a direct result of the termination for default of the Refurbishment and Refill Contracts. 210. The services and supplies purchased under Contract

No. SP0406-05-M-Z791, required to secure the storage of GFP, were similar to those purchased under the Refurbishment and Refill Contracts. 211. Yates is liable to the Government for costs it

incurred, in the amount of $31,837.41, under Contract No. SP0406-05-M-Z791, pursuant to the Default clauses contained in the Refurbishment and Refill Contracts.

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COUNT II Reprocurement Costs (Removal of GFP and Debris from Yates International Facility)1 212. The Government's requirement to procure CLIN 9905 of

Contract No. SP0406-05-D-4067-001Z was a direct result of the termination for default of the Refurbishment and Refill Contracts. 213. The services and supplies purchased under CLIN 9905

under Contract No. SP0406-05-D-4067-001Z, for transfer of the abandoned GFP and cleanup of the Yates facility, were similar to those purchased under the Refurbishment and Refill Contracts. 214. Yates is liable to the Government for costs it

incurred under CLIN 9905 under Contract No. SP0406-05-D-4067001Z, in the amount of $62,901.88, pursuant to the Default clauses contained in the Refurbishment and Refill Contracts.

1

Performance under Contract SP0406-05-D-4067-001Z is still continuing and the Government is not therefore currently able to assess the entire reprocurement costs it will incur under this or any other follow-on contract. However, because the nature of CLIN 9905 of the contract is severable from the remainder of the contract because it was a one-time cost resulting from Yates International's default, the Government is asserting damages for this single CLIN now. By doing so, the Government is in no way forfeiting or waiving its rights to seek additional reprocurement costs from Yates International in the future under this or any other contract. 27

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COUNT III Breach of Contract Damages (Temporary Storage of Government Furnished Property) 215. Yates' abandonment of the Refurbishment Contract

constituted a breach of contract. 216. Yates' abandonment of the Refill Contract constituted

a breach of contract. 217. The Government's requirement to obtain temporary

secure storage of the GFP abandoned by Yates was a direct and proximate result of Yates' breach of the Refurbishment Contract and/or the Refill Contract. foreseeable by Yates. 218. Yates is liable to the Government for costs it This requirement was reasonably

incurred under Contract No. SP0406-05-M-Z791, in the amount of $31,837.41, as damages for breach of contract. COUNT IV Breach of Contract Damages (Removal of GFP and Debris from Yates International Facility) 219. Yates' abandonment of the Refurbishment Contract

constituted a breach of contract. 220. Yates' abandonment of the Refill Contract constituted

a breach of contract. 221. As a direct and proximate result of Yates' breach of

the Refurbishment Contract and/or the Refill Contract, the Government was required to clean up the premises abandoned by 28

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Yates and transfer the abandoned GFP to the follow-on contractor. This requirement was reasonably foreseeable by Yates. 222. Yates is liable to the Government for costs it

incurred under CLIN 9905 of Contract No. SP0406-05-D-4067-001Z, in the amount of $62,901.88, as damages for breach of contract. COUNT V Breach of Contract Damages (Cylinder Valves) 223. Yates accepted payment for 2,627 cylinder valves under

the Refurbishment Contract which it failed to provide to the Government. 224. Because Yates did not tender the 2,627 cylinder valves

to the Government, it breached the parties' contract. 225. The Refurbishment Contract contains a price list which

provides a price for miscellaneous parts that the contractor might need to purchase. $12.50 each. 226. Yates is liable for breach of contract damages to the The price listed for "Cylinder Valve" is

Government for the 2,627 cylinder valves, in the amount of $32,837.50, as a result of its breach of the Refurbishment Contract.

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COUNT VI Conversion (Cylinder Valves) 227. The abandoned property at Yates' Holland facility Yates accepted payment

included 2,627 cylinders without valves.

for providing these 2,627 cylinders, including the valves, to the Government. 228. Upon payment, these cylinder valves became Government The Government possessed title to the

Furnished Property. cylinder valves.

Yates maintained possession of the cylinder

valves and has failed to return them to the Government. 229. Yates' failure to provide the 2,627 cylinder valves to

the Government after receipt of payment constitutes a conversion of the cylinder valves. 230. Yates is liable to the Government for conversion of

the 2,627 cylinder valves, in the amount of $32,837.50 for the value of the converted property plus any additional damages or relief available at law or equity. PRAYER FOR RELIEF WHEREFORE, defendant respectfully requests that the Court enter judgment in its favor, order that the complaint be dismissed, and grant defendant a monetary judgment against Yates International in the amount of $127,576.79 and such other and further relief as the Court may deem just and proper.

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Respectfully submitted, PETER D. KEISLER Assistant Attorney General DAVID M. COHEN Director s/ Brian M. Simkin BRIAN M. SIMKIN Assistant Director s/ Lauren S. Moore OF COUNSEL: DONALD S. TRACY Chief Trial Attorney Office of Counsel Defense Supply Center Richmond 8000 Jefferson Davis Highway Richmond, VA 23297-5701 (804) 279-4811 LAUREN S. MOORE Attorney Commercial Litigation Branch Civil Division Department of Justice 1100 L Street, N.W. Attn: Classification Unit 8th Floor Washington, D.C. 20530 Tele: (202) 307-6288 Facsimile: (202) 514-8640 Attorneys for Defendant JULY 25, 2006

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CERTIFICATE OF ELECTRONIC FILING I hereby certify that on the 25th day of July, 2006, a copy of the foregoing "DEFENDANT'S AMENDED ANSWER AND COUNTERCLAIM" was filed electronically. I understand that notice of this

filing will be sent to all parties by operation of the Court's electronic filing system, and that the parties may access this filing through the Court's system. /s/ Lauren S. Moore