Free Response to Proposed Findings of Uncontroverted Fact - District Court of Federal Claims - federal

Case 1:04-cv-00632-LJB

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS INFORMATION SYSTEMS AND NETWORKS CORPORATION, Plaintiff, v. THE UNITED STATES, Defendant. ) ) ) ) ) ) ) ) ) )

No. 04-632C (Judge Bush)

DEFENDANT'S RESPONSE TO PLAINTIFF'S AMENDED PROPOSED ADDITIONAL FINDINGS OF UNCONTROVERTED FACT REGARDING OPPOSITION TO DEFENDANT'S MOTION FOR SUMMARY JUDGMENT CONCERNING AMENDED COMPLAINT 1. Contract No. F49642-88-D-0054, ("the Prime Contract")

was a contract between the Small Business Administration ("SBA") and the Air Force District of Washington ("defendant"). See

Plaintiff's Appendix to Amended Opposition to Defendants Motion for Summary Judgment Concerning Amended Complaint ("A_") at 2, 60; Defendant's Appendix to Defendant's Motion for Summary Judgment Concerning Amended Complaint ("DA_") at 18. RESPONSE: We object upon the grounds that proposed finding is vague and argumentative (particularly the characterization of the defendant). follows. Admits, in part. Information Systems and Networks Without waiving any objection, we respond as

Corporation ("Info Systems"), a section 8(a) contractor, entered into a tripartite contract (contract no. F49642-88-D-0054) with the Small Business Administration ("SBA") and the United States

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Air Force.

Amended Complaint, ¶¶ 7-8; A2 (tripartite signature

page); A1-79 (tripartite contract).1 2. Plaintiff Information Systems & Networks Corporation

("ISN") entered into Subcontract no 3-88-1-2885 (the "Subcontract") with the SBA. RESPONSE: We object upon the grounds that proposed finding is incomplete and misleading. We further object upon the grounds See A at 2, 59; See DA at 2.

that this fact is not material to our motion for summary judgment. Without waiving any objection, we respond as follows. Finding no. 2 implies that there was a

Admits, in part.

separate document that was the subcontract, but that is not true. Info Systems entered into a tripartite contract (contract no. F49642-88-D-0054) with the SBA and the Air Force. Amended

Complaint, ¶¶ 7-8; A2 (tripartite signature page); A1-79 (tripartite contract). However, we admit that this single

document (the tripartite agreement) did include provisions referencing a subcontract numbered 3-88-1-2885. 3. In September 1988, ISN, SBA, and defendant entered into

"Amended Complaint" refers to the amended complaint filed in this action by the plaintiff on or about November 30, 2004. "A" refers to the appendix filed together with "Defendant's motion for summary judgment concerning amended complaint" and these proposed findings of uncontroverted facts. The pages are identified as pages "a" through "j," and then by the numbers 1 through 81. -2-

1

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a Tripartite Agreement covering the Subcontract and the Prime Contract. See DA at 2. Included within the Tripartite

Agreement are the various Prime Contract provisions including standard FAR provisions. See DA at 1-60. Provision 23, entitled

"Subcontract Provisions," sets forth the rights and obligations of ISN and defendant under the Subcontract including ISN's obligation to perform the Subcontract in accordance with the terms of the Prime Contract in exchange for the defendant paying ISN under the Subcontract in accordance with the terms of the Prime Contract. See A at 60; DA at 18. The Tripartite Agreement

also contained FAR 52.216-18 which states that supplies or services furnished under the Subcontract were to be delivered through Delivery Orders ("DO's). RESPONSE: We object to finding 3 upon the grounds that it does not state findings of fact; instead, it characterizes legal agreements and legal obligations. we respond as follows: Admits, in part. We admit that the tripartite agreement Without waiving any objection, See DA at 13.

contains references to a prime contract between SBA and the Air Force, and a subcontract between SBA and Info Systems. E.g., A2.

We admit that the tripartite agreement contains several standard FAR provisions, including FAR 52.216-18. See A33 (delivery order

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provision).

We admit that the tripartite agreement includes a A18.

section 23 titled "Special 8(a) Subcontract Conditions." 4.

The Air Force issued Delivery Order 6009 on September

14, 1989. RESPONSE: We object to finding 4 upon the grounds that it is not material to our motion for summary judgment. objection, we respond as follows: Admits. 5. On or about October 23, 1991, ISN submitted a certified Without waiving any

CDA Claim for $1,383,111, which represented payment of claimed amounts plus CDA interest in connection with the termination of DO 6009. RESPONSE: We object to finding 5 upon the grounds that it is not material to our motion for summary judgment, and upon the grounds that it is vague and confused. respond as follows: Admits, in part. We admit that Info Systems submitted a Without waiving any objection, we See A at 38.

claim for $1,383,110.93 on October 23, 1991 in connection with a termination for convenience of delivery order 6009. 6. The cognizant contracting officer did not issue a final See A at 40. ISN filed a notice of

decision on ISN's CDA claim.

appeal with the Armed Services Board of Contract Appeals -4-

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("ASBCA") based upon the deemed-denial of its claim on May 21, 1993. See A at 40. The case was assigned ASBCA No. 46119. See

A at 40. RESPONSE: We object to finding 6 upon the grounds that it is not material to our motion for summary judgment. objection, we respond as follows: Admits. 7. at 51. On July 10, 2002, the ASBCA issued its Opinion. See A Without waiving any

The ASBCA Opinion concluded that ISN was entitled to

recover damages for various losses and costs incurred on the 4 sites under the Delivery Order. See A at 41 to 51. It also

stated that the Subcontract and Prime Contract were distinct from one another. RESPONSE: We object to finding 7 upon the grounds that it is not material to our motion for summary judgment, and upon the grounds that it does not set forth a statement of fact. characterizes legal findings and holdings. objection, we respond as follows: Denies. There was no holding concerning whether the Instead, it See A at 2.

Without waiving any

subcontract and prime contract were distinct from one another. To the contrary, the board included both in its defined term, "contract" -- a recognition that both were part of a single -5-

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document, the tripartite agreement.

Plaintiff's appendix at 2.

Furthermore, Info Systems mis-characterizes the board's decision. The board did not focus upon whether Info Systems was The principal issue concerned an

"entitled to recover damages."

Air Force defense limiting the Info Systems recovery following a termination for convenience. A general entitlement to payment

(as limited in the regulations and by case law) in the wake of a decision to terminate for convenience was not at issue. In any

event, the board decision is not material to our motion for summary judgment. 8. The ASBCA Opinion remanded to the parties the resolution

of the quantum of the issues decided in ISN's favor on entitlement. RESPONSE: We object to finding 8 upon the grounds that it is not material to our motion for summary judgment, and upon the grounds that it does not set forth a statement of fact. characterizes legal rulings. respond as follows: Denies. The case was remanded for determination of proper Instead, it See A at 51.

Without waiving any objection, we

termination for convenience costs in light of the board's rulings concerning various defenses raised by the Air Force. In any

event, the board decision is not material to our motion for summary judgment. -6-

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9.

On April 14, 2003, ISN executed a settlement agreement

with the government only related to the four claims set forth in the Opinion as well as claims under the Prime Contract, but it did not relate to the Subcontract, which is a separate agreement. See A at 56-57; See DA at f-g. RESPONSE: We object to finding 9 upon the grounds that it does not set forth a statement of fact. interpretation: Instead, it offers contract Without waiving any

a statement of law.

objection, we respond as follows: Denies. The interpretation of the contract offered by Info

Systems is inconsistent with the plain meaning of the release in the settlement agreement. Af-g; see the motion for summary

judgment and reply brief filed by the United States in the case. 10. The "subject contract" referred to in the settlement See A at

agreement was Prime Contract No. F49642-88-D-0054 only. 56-57; See DA at F-G. RESPONSE:

We object to finding 10 upon the grounds that it does not set forth a statement of fact. interpretation: Instead, it offers contract Without waiving any

a statement of law.

objection, we respond as follows: Denies. The "subject contract" was the tripartite Furthermore,

agreement, which bears the number F49642-88-D-0054. -7-

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the word "only" does not appear in the release.

The

interpretation offered by Info Systems is inconsistent with the plain meaning of the release in the settlement agreement and the tripartite agreement. 11. Af-g; A1-79.

Subcontract no. 3-88-l1-2885 was not a "subject See A at 56-57; See DA

contract" under the settlement agreement. at F-G. RESPONSE:

We object to finding 11 upon the grounds that it does not set forth a statement of fact. interpretation: Instead, it offers contract Without waiving any

a statement of law.

objection, we respond as follows: Denies. The interpretation offered by Info Systems is

inconsistent with the plain meaning of the release in the settlement agreement and the tripartite agreement, which bears the number F49642-88-D-0054. Af-g; A1-79. The subcontract is a

part of the tripartite agreement, which is a single document. A1-79. 12. While the settlement resolved issues arising under the

Delivery Order, it had no bearing on separate entitlements arising under the Subcontract between ISN and the defendant. A at 56-57; See DA at F-G. Neither party contemplated the See

inclusion of the Subcontract within the scope of the settlement agreement. See A at 56-57; See DA at F-G. -8Specifically, ISN's

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entitlement to indirect costs and profit was not within the scope of the April 14, 2003 settlement agreement. DA at F-G. RESPONSE: We object to finding 12 upon the grounds that it does not set forth a statement of fact. interpretation: Instead, it offers contract Without waiving any See A at 56-57; See

a statement of law.

objection, we respond as follows: Denies. The interpretation offered by Info Systems is

inconsistent with the plain meaning of the release in the settlement agreement and the tripartite agreement, which bears the number F49642-88-D-0054. Af-g; A1-79. The subcontract is a

part of the tripartite agreement, which is a single document. A1-79. The last sentence of finding 12 is unintelligible,

compound and unsupported; no "entitlement to indirect costs and profits" is clearly identified, and we know of no such entitlement. Indeed, Info Systems has failed to even identify

any specific contract provision allegedly giving rise to such entitlement. 13. Under the terms set forth in Table B1 of the

Subcontract, ISN is entitled to reimbursement of indirect costs and profit. RESPONSE: We object to finding 13 upon the grounds that it does not -9See A at 58 and DA at 4.

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set forth a statement of fact. interpretation:

Instead, it offers contract Without waiving any

a statement of law.

objection, we respond as follows: Denies. The interpretation offered by Info Systems is

inconsistent with the plain meaning of the tripartite agreement, which bears the number F49642-88-D-0054. Af-g; A1-79. The

subcontract is a part of the tripartite agreement, which is a single document. A1-79.

Table B-1 identifies labor rates for work performed by various categories of employees, and further provides for four separate mark-ups to be added to labor costs: overhead (on site), G&A and profit. A4. fringe benefits,

Accordingly, pursuant

to table B-1, these four categories of price are recovered only in conjunction with labor costs. A4 ("the following cost

elements will be applied to direct labor costs"). The tripartite agreement further provides that all supplies and services will be ordered pursuant to delivery orders. 34. A33-

Accordingly, absent a delivery order for labor, there could

be no liability for any of the four categories described on table B-1. A4,33-34. In this case, Info Systems has failed to

identify any relevant delivery order as part of the basis for its claim. Respectfully submitted, PETER D. KEISLER Assistant Attorney General -10-

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DAVID M. COHEN Director S/ Franklin E. White, Jr. FRANKLIN E. WHITE, JR. Assistant Director S/ James W. Poirier JAMES W. POIRIER Attorney Commercial Litigation Branch Civil Division Department of Justice Attn: Classification Unit 8th Floor, 1100 L St, N.W Washington, D.C. 20530 Tele: 202-307-6289 Fax: 202-514-7969 July __, 2005 Attorneys for Defendant

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CERTIFICATE OF FILING I hereby certify that on July __, 2005, a copy of the foregoing "DEFENDANT'S RESPONSE TO PLAINTIFF'S AMENDED PROPOSED ADDITIONAL FINDINGS OF UNCONTROVERTED FACT REGARDING OPPOSITION TO DEFENDANT'S MOTION FOR SUMMARY JUDGMENT CONCERNING AMENDED COMPLAINT" 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. through the Court's system. S/ James W. Poirier Parties may access this filing