Free Motion to Dismiss - Rule 12(b)(1) - District Court of Federal Claims - federal

Case 1:99-cv-00961-LAS

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

Introduction
On August 20, 1998, the Federal Highway Administration (FHWA or the Government) entered into Contract Number DTFH70-98-C-00027, FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020 with White Buffalo Construction, Inc. (WBC) in the amount of $1,370,480.00. The type of construction to be performed consisted of riprap, embankment, surfacing, retaining walls, and drainage for several sites damaged by the 1997 floods. The Government terminated WBC for default on December 1, 1998, and later converted the termination to a termination for convenience on January 15, 2004, based on overburden at MP 46.7 that appeared to provide an independent reason why the road could not be opened by the contractually required due date. WBC submitted their first settlement proposal on January 13, 2005. The Government audited the settlement proposal. WBC did not allow the auditor access to its materials at its business, but required the audit to be performed at the office of WBC's attorney. WBC did not provide its records until June 21, 2005. Data and records requested by the Defense Contract Audit Agency (DCAA) months earlier were continuing to be provided by WBC in late October. On January 18, 2006, WBC still had not provided answers to requests from DCAA. Thereafter, WBC asked for additional time to review the draft audit before holding the exit conference. The audit was completed on May 12, 2006 by the DCAA and provided to WBC on May 25, 2006. On October 16, 2006, WBC submitted a revised settlement proposal. As part of this proposal WBC included an appendix that contained its "Justification for Anticipatory Profit and a Summary of Facts Supporting Bad Faith". This revised settlement proposal was provided to the auditor for review. On March 29, 2007, WBC notified the Government that it would be providing a third settlement proposal by the end of April. It provided its third settlement proposal on June 26, 2007. For purposes of this Contracting Officer's decision the analysis is based on this third settlement proposal. WBC is asking for its costs on the project and lost profit on the work it was not able to perform. Its lost profit argument is based on an allegation that the Government acted in bad faith in administering and terminating the contract. This analysis will address first the termination settlement proposal and then the bad faith claim.

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Termination Settlement Analysis
In its third proposal, WBC requests $1,274,854.71. This is broken down into 10 categories (including payments received). In the following paragraphs, I analyze each category separately and determine the costs that I believe should be paid.

Direct Labor
WBC proposed $128,478.00 in direct labor costs. The audit supported $127,463.00. The difference ($1,015.00) is the cost of an onsite supervisor after the termination. The audit did not question the amount of the direct labor, but rather the validity of it being charged to the project. I concur with the auditor's findings, and disallow the $1,015.00. I will allow $127,463.00 for direct labor.

Other Direct Job Costs
WBC proposed $128,598.08 in other direct job costs. The audit supported $94,523.00. The difference ($34,075.00) is broken down into six areas: Owner Operators, McBride Legal Costs, Landmark Extra Work, Landmark Legal Costs, Landmark Contract Work and Landmark Interest. Owner Operators The audit questioned $18,113.00 of owner operator costs due to insufficient support. The auditor noted that WBC was unable to produce invoices supporting the amount of time worked, the item of equipment, the agreed-to rates, or the amount billed to this job. The auditor noted that without invoices or other independent corroboration, there was no evidence of the purpose and applicability of the cost to the termination. Despite repeated requests, WBC did not provide this information during the initial audit or with the second and third settlement proposals. Instead WBC continued to state that the information was in the boxes provided to the auditor during the initial audit. Without some proper invoices or other independent corroboration, I cannot tie these costs to this project. Accordingly, this portion of the Other Direct Job Costs will be disallowed. McBride Legal Costs The audit questioned $3,117.00 of legal costs. I will allow this cost in the amount of $3,117.00. Landmark Extra Work The audit questioned $2,102.00 of extra work by the surveyor on the project. I will allow this cost in the amount of $2,102.00. Landmark Legal Costs The audit questioned $1,272.00 for legal costs claimed by the surveyor on the project. I will allow this cost in the amount of $1,272.00.

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

Landmark Contract Work The audit questioned $7,056.00 of contract work by the surveyor on the project. The Government estimated that no more than 50% of the survey work on the project was performed by the time the contract was terminated. A settlement should compensate the contractor fairly for the work done on the project. In this case, no more than 50% of the survey work was performed. Accordingly, WBC should receive no more than 50% of the bid price for the survey bid item. The questioned amount of $7,056.00 represents the amount in excess of 50% of the survey bid price. I conclude that the amount over 50% should be denied. Accordingly, I will disallow this amount. Landmark Interest The audit questioned $2,415.00 for interest for work by the surveyor on the project. Under FAR 31.205-20, "interest on borrowings (however represented)" are not allowable. This interest charge is an interest on borrowings financed by Landmark. Radcliffe Const. Co., Inc., 90-2 BCA P 22,651, ASBCA Nos. 39252, 39253 (Jan. 26, 1990). Furthermore, WBC did not provide any evidence that it has paid the interest or is obligated to pay the interest. The proposal does not even provide a breakdown of the how the interest was calculated. The proposal gives a total amount of interest requested ($2,415.00), provides the dates and amounts for which interest is due and provides a reference to a website from the U.S. District Court for the District of Utah that provides rates for post judgment interest. Accordingly, I will disallow this amount.

Summary of Other Direct Job Costs
I will allow all of the costs that the audit allowed. In addition, I will allow $6,491.00 in costs the audit questioned for a total amount allowed for Other Direct Job Costs of $101,014.00.1

Equipment, Vehicle and Fuel Costs
WBC proposed $26,985.00 in Equipment, Vehicle and Fuel costs. The audit supported $26,985.00. I will allow $26,985.00 for Equipment, Vehicle and Fuel costs.

Other Equipment and Vehicle Costs
WBC proposed $91,968.00 in Other Equipment and Vehicle Costs. The audit supported $65,808.00. The difference ($26,160.00) is broken down into two categories: LS 3400 and Truck Tires.

1

$94,523.00 + $3,117.00 + $2,102.00 + $1,272.00 =App. 65 $101,014.00

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

LS 3400 WBC proposed $25,000.00 for repairs to the LS 3400 Excavator. The audit questioned the full amount because the repairs were never performed. The LS 3400 Excavator had been fully depreciated before the beginning of the fiscal year that ended on March 31, 1999. Any remaining capital value of the equipment could not be charged against the project. Any new value given to the equipment by a major repair would need to be depreciated. However, until such repair is made, there is no further value of that equipment that can be charged to the project. I note that in the nearly 9 years since the damage occurred, it has not been fixed. Thus, when major segments of the equipment fails after full depreciation, such failure does not become a cost of the project, unless they are repaired and then, for major repairs that appreciably prolong its intended life, only the new depreciation can be charged. WBC claims that the equipment had $25,000.00 less residual value after the incident than before, based on appraisals conducted in 2006. I do not conclude under the cost principles of FAR Part 31 that this loss of value is allocable to the project. To allow this loss would be to allow WBC to depreciate more than the full value of the equipment. WBC claims that under FAR 31.205-24, in effect at the time of this contract but since removed, extraordinary repair costs are allowable. WBC has performed no repairs so this provision is not applicable. In addition, the FAR 31.205-24 provision allowed extraordinary maintenance and repair costs for property only as long as such repair costs did not add to the permanent value of the property or appreciably prolong its intended life. In this case, the intended life of the equipment already had expired, as it was fully depreciated. The repair would have added to its value and would have prolonged its intended life. I do not find that the loss of value attributed to the Link Belt 3400 excavator is reasonably allocable to this project. I will disallow this portion of the Other Equipment and Vehicle Costs. Truck Tires WBC proposed $1,160.00 for the value of tires that were taken from a truck on the project. The audit questioned the full amount because the tires were not replaced so the expense was not incurred. The audit also questioned charging the full cost to this project as this project only used the truck for 2 months of its life. It is more appropriate to recover the costs from WBC's insurance company if the tires were stolen or from the winterization contractor (Kerr) if it was using the truck at the time the tires were removed. I will disallow this portion of the Settlement proposal.

Summary of Other Equipment and Vehicle Costs
I concur with the audit on the questioned amount of $26,160.00 and I will allow $65,808.00 for Other Equipment and Vehicle Costs.

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

Surety
WBC proposed $276,768.00 for Surety expenses. The audit supported $261,646.00. The difference ($15,122.00) is for the portion of payments WBC made to the surety for interest on monies due to the surety. WBC claims its interest payments to the surety are an allowable expense. FAR 31.205-20 specifically disallows interest on borrowings. The interest WBC paid to the surety was paid because WBC did not pay the surety timely for what it owed the surety. I agree with the audit that this interest payment is not allowed; therefore I deny this portion of the proposal. I concur with the audit and will disallow the $15,122.00. I will allow $261,646.00 for Surety costs.

G&A Expenses
WBC proposed $28,183.00 in G&A expenses. The audit supported $28,183.00. I will allow $28,183.00 for G&A expenses.

Subcontractor Claim
WBC proposed $39,222.35.00 in Subcontract Claim costs. The audit supported $29,528.00. The difference ($9,694.00) is for interest. As stated above, interest is not allowable. Furthermore, WBC did not provide any evidence that it has paid the interest or is obligated to pay the interest. The proposal does not even provide a breakdown of the how the interest was calculated. Accordingly, the interest amount will be disallowed. I will allow $29,528.00 for Subcontractor Claim costs.

Profit
WBC proposed $870,667.00 in "profit." The audit supported $253,211.00, qualified by the fact that the auditor was required to perform the audit on documents WBC made available at its attorney's office. The auditor was not able to view the documents at WBC's place of business. WBC also restricted access to documents it claimed were privileged. Based on the historical records provided, the auditor supported "profit" in the amount of $253,211.00. This amount, however, is not true profit, as it includes G&A and depreciation. Further, this historical figure, to the extent that it is valid, is not definitive under the FAR in the determination of profit for this project. Under FAR 49.203(a), I am not authorized to allow profit when it appears that the contractor would have incurred a loss had the entire project been completed. Based upon the Profit / Loss Analysis at the end of this decision, I determined WBC would have incurred a loss if the entire project had been completed. Accordingly, profit will be disallowed.

Anticipatory profit
Anticipatory Profit addressed following the Bad Faith Claim analysis.

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

Settlement Expenses
WBC proposed $163,070.28 in Settlement Expenses. The audit supported $11,674.00. The difference ($151,396.28) is broken down into five categories: Legal ­ Stoel Rives, Airfare Upgrade, Owner Labor, Miscellaneous Settlement Costs, and Third Party Review of Proposal. Legal ­ Stoel Rives WBC proposed $91,014.24 for incurred legal expenses and $2,500.00 for estimated additional legal expense that will be needed. The audit disallowed these costs per FAR 31.205-47 "Costs related to legal and other proceedings". Further, only actual incurred costs will be reimbursed. Estimated future costs are not eligible for payment. Therefore, this portion of the settlement expenses is denied. Legal expenses are allowable expenses when such expenses are reasonably necessary for the preparation and presentation of settlement claims to the contracting officer. FAR 31.205-42(g)(1)(i). When settlement expenses are significant, the contractor is required to establish a cost account or work order to separately identify and accumulate them. FAR 31.205-42(g)(2). In the present situation, WBC has established no cost account or work order, even though its settlement expenses are stated to be $163,070.28, over a quarter of its total costs sought in its settlement proposal. Further, WBC refused to provide its original invoices to the auditor. WBC offered to allow the Government's in-house counsel to review its invoices. The Government's inhouse counsel, however, is not an auditor; nor does he have expertise to audit records. Further, any audit performed by Government counsel of such records may subject Government counsel to being called as a witness in subsequent litigation. This is not a proper role for Government counsel. Accordingly, WBC's offer was never accepted by the Government. WBC, in its first settlement proposal, requested $16,770.03 in legal costs. The auditor questioned WBC's legal costs because he was not allowed to review the original invoices and the invoices it had did not support the claimed costs. WBC responded by submitting a second settlement proposal asking for $79,265.68 in legal costs. WBC stated that a "substantial portion" was represented by research into the very issue of whether an auditor can require original invoices. Expending a substantial portion of $62,495.65 to research this single issue does not seem reasonable. In its third settlement proposal, WBC again increased its claim for attorney fees, this time to $93,514.24. It is uncertain what these additional fees represent, as the invoices provided by WBC are very vague. In reviewing the invoices provided, I note that there are some entries for items that are not allowable under the FAR. For instance, there is work for WBC's bad faith claim. A bad faith claim is not a settlement proposal, but rather falls under FAR 31.205-47(f)(1). Also, there is work on deemed denial, which also is not a cost allocable or allowable to the settlement proposal, as such relates to claims.

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However, trying to discern how much of the legal costs relate to such issues is not easy, as most of the descriptions contained in the invoices provide no linkage to issues or claims. A further complication is that there is no set rate for the attorneys or the paralegals. For instance, in dividing the amount billed by the hours stated, the rates for the two main attorneys who worked on this case range from a low of $246.87 in February 2006 to a high of $400.00 in March 2004. No two months have the same rate. Also, I could find no correlation between a specific attorney and a higher or lower rate. The average rate is $308.16. I will use this rate in my calculations. I also will use the rate of $160.50 for the paralegal's rate. Using the information provided, I find that the following amounts are not permitted as being related to the bad faith claim: $1,201.812 for REA, $4,961.333 for CFA, and $465.454 for the paralegal time, for a total of $6,628.595. I am unable to determine how much of the rest of the legal fees relate to the bad faith claim. Because the burden of proof is on WBC to support its costs, and because WBC does not differentiate these costs, I believe that assigning another $5,000.00 to the work on this item appears appropriate. Accordingly, of the $91,041.24, I assign $11,628.59 to the lost profit claim, and find this amount to be unallowable as being legal costs for a claim under FAR 31.205-27(f)(1). Further, WBC includes legal costs relating to research done on deemed denial. Such research is for the purposes of determining whether WBC can bring a direct claim to the court without waiting for a COD. I do not find that these costs are reasonably related to the settlement proposal. These amounts include $421.79 of the legal fees. I also subtract out the cost of a meal on February 6, 2004 in the amount of $261.00. There is no support for this cost other than the invoice. The invoice does not say what the two charges ($206.00 and $55.00) represent, other than that they are meals for a luncheon. I cannot determine how this luncheon cost relates to the settlement proposal. There is no attorney time or fees noted for that date. Given these facts, I deny this cost. Further, the legal costs, besides being allowable and allocable, must be reasonable. While the cost associated with a site visit by the attorney may be reasonable for purposes of litigation, I do not find that such costs are reasonable in relation to the settlement proposal. Accordingly, I subtract out the $2,927.526 associated with this trip. The remaining amount of $78,275.347 must be analyzed in terms of the settlement proposal to determine whether it is a reasonable amount. Reasonable is defined as being a cost that does not exceed what would be incurred by a "prudent person in the conduct of competitive business." FAR 31.201-3. There is no presumption that costs are reasonable or unreasonable. FAR 31.201-3(a). When a contracting officer challenges a specific cost, the burden is on the contractor to prove that the cost is reasonable. FAR 31.201-3(a).
2 3

3.9 hours x $308.16 = $1,201.81 16.1 hours x $308.16 = $4,961.33 4 2.9 hours x $160.50 = $465.45 5 $1,201.81 + $4,961.33 + $465.45 = $6,628.59 6 9.1 hours x $308.16 = $2,927.52 7 $93,514.24 - $11,628.59 - $421.79 - $261.00 - $2,927.52 = 69 App. $78,275.34

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

In determining what a prudent person would do in the conduct of competitive business, I find that one factor is the ratio of the legal cost to the value of the matter in issue. A prudent contractor would not expend a large sum of legal costs to address an issue involving a small dollar amount. Another factor is whether the legal costs significantly affect the settlement proposal. A prudent contractor would not expend legal costs for research into merely hypothetical matters. In the present situation, the auditor questioned $239,887.718 of the costs, of which $163,070.28 were settlement expenses, composed mostly of the $93,514.24 in claimed attorney fees and $43,321.90 in claimed payroll for WBC employees. The claimed payroll was merely a matter of the consistent practices of WBC and I am at a loss to determine why legal assistance was needed on this issue. Also, I do not understand how significant legal work would be needed to determine allowability of legal fees. Outside of the attorney fees and claimed payroll, the auditor questioned $102,051.579 of the costs. While it is very difficult to discern anything with certainty from the invoices, comparing the dates of the audit with the invoices leads me to conclude that apparently WBC incurred nearly $50,000.00 in legal fees on and after it began working on the audit. Taking into account the relatively small amount of issues and the small amount of dollars at stake, spending $50,000.00 in legal fees for $102,051.57 in challenged costs is not prudent. I note in Tagarelli Bros. Const. Co., Inc., ASBCA No. 34793, 88-1 BCA P 20363 (November 24, 1987), the Board concluded that legal fees in the amount of 1/3rd of the claim were not reasonable. In this case, I believe that legal fees in the amount of nearly one-half of the amount in dispute is not reasonable. In determining reasonableness, I consider the amount actually at issue, the issues raised, the need for legal assistance, and the value of that assistance to the process. In this case, the amount actually at issue is small, the issues raised (salary of owners, lack of invoices, equipment damage, interest, airfare upgrade, and legal costs) are not complex, and I do not find that the legal input provided much assistance to the auditor or this office. Accordingly, I find that a prudent contractor given these factors would not have expended more than the approximate $15,000.00 in legal costs that WBC expended to prepare the settlement proposal, and would not have expended more than an equal amount in responding to the audit. Accordingly, I find that a prudent contractor would not have expended more than $30,000.00 in legal fees associated with the settlement. I will allow $30,000.00 for legal costs.

Airfare Upgrade WBC proposed $200.00 for the cost of an upgraded airfare. The audit disallowed this cost per FAR 31.205-46(b) "Travel Costs" as the upgrade represents the portion of the airfare in excess of customary standard or coach airfare. I agree with the audit determination and thus this portion of the settlement expense will be disallowed.

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This number is the difference between what DCAA supported and WBC's third proposal. $ 239,887.71 - $93,514.24 - $43,321.90 = $102,051.57 App. 70

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Owner Labor WBC proposed $43,321.90 for incurred payroll expenses and $1,200.00 for estimated additional payroll expenses that will be needed. Only actual incurred costs are eligible for payment, so estimated future costs are not eligible for payment. I will allow $43,321.90 in Owner Labor. Miscellaneous Settlement Costs In its first settlement proposal, WBC proposed $9,249.00 in miscellaneous settlement costs that the audit supported. In its second settlement proposal, WBC proposed an additional $12,431.96 in miscellaneous settlement costs beyond the first proposal amount. Of this the auditor indicated $2,425.03 was allowable. In its third settlement proposal WBC proposed an additional $13,835.14 in miscellaneous settlement costs beyond the first proposal amount10. The auditor did not review the portion of these additional settlement costs that were not in the second proposal. The additional miscellaneous settlement costs can be broken down into 11 categories: Westlaw subscription, parking fees, mileage, food, lodging, clerical supplies, photocopying, laptop, software, damage to pickup, rental vehicle. Allowable costs All the costs contained in the parking fees, mileage, food, lodging, clerical supplies and photocopying are allowable settlement costs. Therefore, I allow $2,864.7111 for these costs. Unallowable costs Westlaw subscription: WBC proposed $4,633.89 for a subscription of Thompson West (Westlaw) from February 2005 through April 2007. This cost does not seem to be reasonable given the scope of the settlement proposal and extensive involvement of legal counsel; therefore I will disallow this cost. Laptop and software: WBC proposed $1,899.99 for a laptop computer and $198.00 for an additional copy of its accounting software that it used for composing its settlement proposal and conducting the audit. The audit did not support the full cost of the laptop and software being allocated to this project. The laptop and software should be capitalized and depreciated and the appropriate portion of the depreciation could be charged to this project. I do not know WBC's standard capitalization and depreciation process so can not determine the appropriate portion allocable to this project. Assuming the computer and software have a three year life, I will allow one year of depreciation of $700.00.12 Damage to pickup and rental vehicle: WBC proposed $3,638.55 for damage to the 1996 Dodge pickup and $600.00 for costs of a rental vehicle that would be needed during the repair of the pickup. The audit did not support these costs as the repair work has not been completed; the rental vehicle has not been used, so no cost has been incurred. These costs are not allocable to the settlement proposal, and should have been covered under insurance. Accordingly, these costs will be disallowed.
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This amount includes all the additional miscellaneous settlement costs in proposal two and proposal three. $102.26 + $679.50 + $544.50 + $258.44 + $147.38 + $8.45 + $148.50 + $50.40 + $70.08 + $855.20 = 2,864.71 12 $1899.99 + $198.00 = $2,097.99. $2,097.99/3 = $699.33 round to $700.00 App. 71

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Contracting Officer's Decision FS ERFO 97-18(2) - FDR 33 (MP 44.5 ­ MP 47.3), FDR 3347, FDR 3367020

Summary of Miscellaneous Settlement Expenses I will allow $3,564.7113 for the Miscellaneous Settlement Expenses. Third Party Review of Proposal In its third proposal WBC proposed $1,750.00 for costs related to having an independent third party review its settlement proposal. The auditor did not review this cost. I will allow $1,750.00 for Third Party Review of Proposal.

Summary of Settlement Expenses
Based on the above analysis, I will allow a total of $78,636.6114 for Miscellaneous Settlement Costs.

Prior Payments
WBC proposed $479,085.00 as the amount of payments that it has received to date from the Government in relation to this project. The audit supports $479,085.00 in prior payment. I agree that the Government previously has paid $479,085.00 to WBC.

Overall Summary of Allowed Amounts
Based on the above analysis, I conclude that WBC is due $240,178.61as its termination costs and profit. This amount is the sum of the above approved amounts, which are summarized here: Direct Labor: Other Direct Job Costs: Equipment, Vehicle and Fuel: Other Equipment and Vehicle Costs: Surety: G&A Expenses: Subcontractor Claim: Profit: Settlement Expenses: Subtotal: Payments Received: $127,463.00 $101,014.00 $ 26,985.00 $ 65,808.00 $261,646.00 $ 28,183.00 $ 29,528.00 $ 0.00 $ 78,636.61 $719,263.61 ($479,085.00)

Allowed Amount:

$240,178.61

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$2,864.71 + $700.00 = $3,564.71 $30,000.00 + $43,321.90 + $3,564.71 + $1,750.00= $78,636.61 App. 72

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BAD FAITH CLAIM
WBC has submitted a claim that the Government acted in bad faith in the administration and termination of the contract. The bad faith claim is relevant to the extent that if bad faith exists, such would constitute a breach of the contract and may entitle the contractor to recover lost profits it would have earned on uncompleted work under the contract. In the absence of bad faith, the contractor is restricted to its termination for convenience costs and any profit associated with such costs. WBC has listed several incidents that it alleges show bad faith on the part of the Government. These will be considered to determine whether bad faith existed on the contract However, preliminarily, I note that the long-standing standard for reviewing claims of bad faith has been called into question by WBC. Citing Am-Pro Protective Agency, Inc. v. United States, 281 F.3d 1234 (Fed.Cir. 2002), and Tecom, Inc. v. United States, 66 Fed.Cl. 736 (2005), WBC asserts that the standard for evaluating bad faith claims has changed, and that at the heart of the Government's "wrongful conduct" is the Government's "failure to cooperate with, and indeed its actual interference with, WBC's performance," thus breaching the implied duty of good faith and fair dealing. This, according to the claim, allows WBC to claim lost profits. I do not read Am-Pro to do anything more than state that the standard of proof in cases where bad faith is alleged is the clear and convincing standard. The court stated that this standard most closely aligns with the "well-nigh irrefragable" proof required by the courts. Am-Pro, 281 F.3d at 1239-1240. The Am-Pro court does not purport to lessen the standard of proof, but to place the standard into one of the three generally accepted standards of proof, namely, the clear and convincing standard. Although Tecom argued for a different standard, it is hard to square that case with the long precedence established for claims of bad faith. See, North Star Alaska Housing Corporation v. United States, 76 Fed.Cl. 158, n. 34 (2007). Further, subsequent courts have not followed Tecom's lead. North Star, 76 Fed.Cl. at 187-188 (requirement to show clearly and convincingly animus on the part of the Government); L.P. Consulting Group, Inc. v. United States, 66 Fed.Cl. 238 (2005) (specific intent to injure the plaintiff is required). In any event, the issue of bad faith arises only if the Government acted inconsistently with its obligations under the contract. The covenant of good faith and fair dealing is linked ultimately to the contract, and the manner in which the Government carried out its discretion under the contract. The covenant does not serve to place on the Government a requirement that the contract places on the contractor, nor to impose on the Government obligations not contemplated under the contract. With this framework in mind, I turn to a consideration of WBC's allegations.

SUBPART 1
Government Prevented the Contractor from Starting Work on Time and Did Not Extend the Contract Completion Date
CLAIM SUMMARY ­ SUBPART 1
Primary Issue - Prevention of Contractor's Start of Work WBC claims the Government failed to issue an unrestricted Notice to Proceed on September 1, 1998, which resulted in them not being allowed to perform full construction operations until

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September 15, 1998. It also claims that the Government did not issue a time extension as allowed under FAR Clause 52.211-10. They further contend that commencement was initially not allowed due to an unreasonable belief that the contractor could not begin on September 1, 1998 due to environmental restrictions; only to later be changed to failure to provide an approved schedule. Due to this late issuance of notice to proceed, WBC contends the Government erred in issuance of both the Cure Notice and the Notice of Termination for Default. Secondary Miscellaneous Issues Under this subpart, WBC also claims a pattern of interference on behalf of Henry "Paul" Rettinger, III throughout the project. Some of the claimed assertions by WBC include the following: · Agreements between WBC and Sajid Aftab for pay estimates, items of work, and other items demanding attention, that were later overruled by Mr. Rettinger. · Many letters were written by Mr. Rettinger, and Mr. Aftab was forced to sign them.

FINDINGS OF FACTS ­ SUBPART 1
1) Prevention of Contractor's Start of Work a) Contract FAR Clauses The contract included the following Federal Acquisition Regulation (FAR) clauses pertinent to Subpart C of the claim: FAR Clause 52.211-10, Commencement, Prosecution, and Completion of Work (APR 1984) Alternate 1 (APR 1984); FAR Clause 52.236-13, Accident Prevention (NOV 1991) Alternate 1 (NOV 1991); and FAR Clause 52.236-15, Schedules for Construction Contracts (April 1984). FAR Clause 52.211-10 is included below for reference.
FAR Clause 52.211-10, COMMENCEMENT, PROSECUTION, AND COMPLETION OF WORK (APR 1984) ALTERNATE 1 (APR 1984) The Contractor shall be required to (a) commence work under this contract within 10 calendar days after the date the Contractor receives the notice to proceed, (b) prosecute the work diligently, and (c) complete the entire work ready for use not later than October 29, 1999 subject to such extensions as may be authorized. The time stated for completion shall include final cleanup of the premises. The completion date is based on the assumption that the successful offeror will receive the notice to proceed by September 1, 1998. The completion date will be extended by the number of calendar days after the above date that the contractor receives the notice to proceed, except to the extent that the delay in issuance of the notice to proceed results from failure of the contractor to execute the contract and give the required performance and payment bonds within the time specified in the offer.

b) Standard Specifications (FP-96) and Special Contract Requirements
The contract included the following Standard Specifications in accordance with the Standard Specifications for Construction of Roads and Bridges on Federal Highway Projects (FP-96) as amended by the Special Contract Requirements (SCR) applicable to this Subpart: Section 107 ­ Legal Relations and Responsibilities to the Public; Section 108 ­ Prosecution and Progress; Section 153 ­ Contractor Quality Control; and Section 155 ­ Schedules for Construction Contracts. These Sections, or portions thereof, are included below for reference.

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Section 107 ­ LEGAL RELATIONS AND RESPONSIBILITIES TO THE PUBLIC
(Text Omitted) 107.10 Environmental Protection (Text Omitted) Submit a Hazardous Spill Plan, prior to construction, stating what actions will be taken in case of a spill. (Emphasis Added) This plan will also incorporate preventative measures to be implemented, such as the placement of refueling facilities, storage and handling of hazardous materials, etc. Immediately notify the CO of all hazardous spills. (Text Omitted)

Section 108 ­ PROSECUTION AND PROGRESS
108.01 Commencement, Prosecution, and Completion of Work. FAR Clause 52.211-10, Commencement, Prosecution, and Completion of Work is supplemented as follows. A preconstruction conference will be held after the contract is awarded and prior to notice to proceed is issued. Seven days before the preconstruction conference, furnish three copies of the preliminary construction schedule according to Section 155. (Emphasis Added) (Text Omitted)

Section 153 ­ CONTRACTOR QUALITY CONTROL
(Text Omitted) 153.02 Contractor Quality Control Plan. Before start of the work, submit a written quality control plan for acceptance. (Emphasis Added) With prior approval, submission of a quality control plan for items of work not immediately scheduled to begin may be deferred. (Text Omitted)

Section 155 ­ SCHEDULES FOR CONSTRUCTION CONTRACTS
(Text Omitted) 155.02 General. Submit 3 copies of a preliminary construction schedule at least 7 days before the preconstruction conference. A preliminary construction schedule is a written narrative with a detailed breakdown of all contract activities for the first 45 days after the notice to proceed is issued. Within 7 days after the preconstruction conference, the preliminary construction schedule will be accepted or rejected. If rejected, submit a revised schedule within 3 days. Do not begin work, except mobilization, traffic control, and Section 637 work, without an accepted preliminary construction schedule. (Emphasis Added)

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Use the Critical Path Method (CPM) described below to develop the construction schedule for the total contract work. (Text Omitted) 155.05 Written Narrative. The following applies to the written narrative: (a) Estimate starting and completion dates of each activity. (b) Describe work to be done within each activity including the type and quantity of equipment, labor, and material to be used. (c) Describe the location on the project where the activity occurs. (d) Describe planned production rates by pay item quantities (e.g., cubic meters of excavation per day/week). (e) Describe work days per week, holidays, number of shifts per day, and number of hours per shift. (f) Estimate any periods during which an activity is idle or partially idle. Show the beginning and end dates for reduced production or idle time. (g) Describe expected and critical delivery dates for equipment or material that can affect timely completion of the contract. (h) Describe critical completion dates for maintaining the construction schedule. (i) Identify the vendor, supplier, or subcontractor to perform the activity. State all assumptions made in the scheduling of the subcontractor's or supplier's work. (Text Omitted)

c) Initial Contract Award Documentation i) Contract Award On August 20, 1998, WBC was awarded the contract in the amount of $1,370,480.00. ii) Preconstruction Conference Package The Preconstruction Conference Package Letter, written by Howe T. Crockett, Construction Operations Engineer, was sent to WBC on August 21, 1998. The Preconstruction Package Letter identified a list of items to be provided by the Contractor at or prior to the Preconstruction Conference, which included the following: a) Submit three copies of a preliminary construction schedule. [See Standard Specification 155.] b) Submit a written Quality Control Plan. [See Standard Specification 153.] c) Identify your Traffic and Safety Supervisor. [See Standard Specification 156.08] d) If you elect to subcontract a portion of the work, submit SF 1413, Statement and Acknowledgement, and WFLHD 130, Subcontracting Statistics. [See Standard Specification 108.02] e) Submit a written proposed plan for implementing Accident Prevention. [See FAR 52.236-13, Standard Specification 107.08, and WFLHD-28, Guide for Contractor's Accident Prevention Plan.] f) Designate the Contractor's authorized representatives on the project and define the extent of each representative's authority. Complete WFHLD-298, Statement of Authorized Signatures. g) Identify your EEO officer. [See FAR 52.222-27(n).] h) Submit Electronic Funds transfer information if you have not already done so. [See FAR 52.232-28]

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i) Submit "certificates of insurance" for Worker's Compensation, Bodily Injury Liability, and Property Damage Liability if you have not already done so. [See Standard Specification 107.05.]

iii) Delegation of Authority (Government) The Delegation of Authority letter was issued by William L. Parsons, Contracting Officer, on August 24, 1998, which identified the appropriate levels of contract authority applicable to this contract. The authority to issue the Notice to Proceed was specifically delegated to Mr. Crockett, Construction Operations Engineer. The authority to approve/disapprove contractor shop drawings and other submittals (including CPM schedules and QC plans), and the authority to evaluate a contractor's progress with respect to approved progress schedule and request updated schedules when necessary were delegated both to Mr. Rettinger, Resident Engineer, and Mr. Aftab, Project Engineer.

d) Preconstruction Conference
The preconstruction conference was held on August 27, 1998, with many key project personnel in attendance, some of whom include: · Howe T. Crockett, Construction Operations Engineer, WFLHD · Paul Rettinger, Resident Engineer, WFHLD · Sajid Aftab, Project Engineer, WFHLD · Luther Clevenger, President, WBC · Julie Clevenger, Secretary/Treasurer, WBC. · Robin McAlpine, District Engineer, U.S. Forest Service At the preconstruction conference, the importance of the completion of this project was expressed by the Forest Service. Robin McAlpine reiterated the importance of the schedule as the roads to be repaired are the main access roads to the town of Powers through Gold Beach and nearby towns; and the public is very anxious for this road to be repaired. Mr. McAlpine stated that when this is accomplished and the road is again open, tourism will increase as will job development in the area. At the time of the Preconstruction Conference, WBC had not provided the Government the preliminary construction schedule according to Mr. Aftab's notes from the meeting. The Government expressed the importance of providing the preliminary construction schedule on four separate occasions during the preconstruction conference. The notes also stated, "Luther responded that he couldn't understand the amendment to the solicitation on various dates (E10) and expressed concern about the schedule he had to abide by. Paul then explained the schedule (the third time)."

e) Notice to Proceed
The Notice to Proceed letter dated August 27, 1998 from Mr. Crockett was issued with an effective date of September 1, 1998 with a fixed completion date of October 29, 1999. According to a fax from Mr. Crockett to Mr. Aftab and Mr. Rettinger, this letter was faxed and mailed to WBC on August 28, 1998.

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The Notice to Proceed was issued with stipulations requiring the Contractor to perform specific actions prior to commencing work as specified in the original contract. The letter stated the following: You are hereby notified to begin construction effective on September 1, 1998, on Siskiyou N.F., FDR 33 (MP 44.5-47.3), FDR 3347, FDR 3347020, awarded to you on August 20, 1998, under contract number DTFH70-98-C-00027. The Notice to Proceed is granted subject to the following stipulations: 1) The Contractor's CPM schedule and Quality Control Plan are submitted to the Project Engineer by August 31, 1998, and approved by him. 2) All other documentation or requirements contained in our August 21, 1998, letter to your office, and not supplied by you at the Preconstruction Conference, has been received by the Project Engineer by August 31, 1998. In accordance with your contract you will be allowed until October 29, 1999, in which to complete the contract.

Each of the items identified in the Notice to Proceed letter were requirements of the original contract. Details of the events surrounding the preliminary construction schedule, accident prevention plan, and quality control plans are as follows: f) Preliminary Construction Schedule The following summarizes the preliminary construction schedule submittals provided by WBC and reviewed by the Government. At the time of submitting its bid, WBC understood that it was required to submit several plans and have an approved schedule before it could begin work on the project. Transcript (Tr), Clevenger, 52:23-53:11. i) Submittal No. 1 WBC brought a schedule to the pre-construction meeting on August 27, 1998, but decided at the meeting that the schedule would not meet the contract requirements and accordingly never submitted that schedule. Tr, Clevenger, 64:3-65:14. Four days later, on August 31, 1998, WBC faxed to the Government's field office the preliminary construction schedule no. 1, a one-page roughly drawn schematic, referenced in the fax as "Preliminary Critical Path Schedule." This schedule did not contain a written narrative nor did it have a detailed breakdown of all contract activities for the first 45 days, as required by the contract. The Government faxed and mailed a letter to WBC on August 31, 1998 rejecting the construction schedule based on the format submitted and overall content not meeting the contract requirements under Section 155. Included with the rejection letter was an example schedule the Contractor could follow. In this letter, the Government granted permission for WBC to begin some work, specifically silt fence and straw bale operations. The letter specifically stated that no other work would be allowed until the schedule was re-submitted in the proper format.

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In the September 1, 1998 diary entry of Mr. Aftab, his telephone conversation with Mr. Clevenger is noted as follows:

The schedule submittal by White Buffalo is very bad condition (as mentioned earlier). It doesn't include any narrative summary & operations shown on or before September 15th were not allowed according to specifications. Luther again apologized & told me he will redo it. Luther also in a joking way told me if he is incompetent? I told him I won't comment on that.

This discussion was followed up on September 3, 1998, where the diary entry of Mr. Aftab relates the following regarding a conversation between Mr. Aftab, Mr. Rettinger, and Mr. Clevenger:

Sajid: When I will be expecting your schedule? Luther: He is still working on it & delivered to us on 9/4/98. Paul (FHWA) asked him if he is working on first 45 days schedule or the whole project schedule?" Luther: I am working on whole project schedule. Luther: As my first schedule was not approved, can I still start doing some clearing and others? Sajid: I allowed you to do mobilization, survey & staking, silt fence & straw bales operation, other than that, no other operation will begin until the proper schedule submitted and approved by us. Luther: I understand that. (Text Omitted) The meeting concluded with a promise from Luther that he will provided all necessary documents as soon as possible.

The revised schedule was not received on September 4, 1998 as indicated by WBC. ii) Submittal No. 2 On September 8, 1998, WBC resubmitted the preliminary construction schedule. This resubmission was faxed, and included a CPM of the work, along with a work plan for the first 45 days. Mr. Aftab's diary for September 8, 1998 states the following:

@ 6:45 am I arrived at the office. Contractor (White Buffalo) schedule was sent to me thru fax. After initial reviewing the schedule & discussing with Paul Rettinger, we decided not to accept this schedule in the format as it does not include narrative/written with a detailed breakdown of all contract activities for the first 45 days. Then I called Luther (White Buffalo) told him that I won't be able to meet him @ the job site today as I have to write some letters & review his plans/schedule. Mike Barber (CI) will be @ job site to collect all the forms & dailies from him.

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Luther asked me again if he can do excavation as he had sent me schedule thru FAX. I told him no. I need 7 work days to review your schedule before approval. He can not work until his schedule get approved. (Text Omitted) Luther called me back around 2:30 pm. He asked me the following questions: 1. Is my schedule look okay? 2. Can I start any other operations? 3. He is asking for waiver of USFS as project falls under Level II. 4. He told me that he is sending 3 copies of schedule to our office. I replied: 1. Open your FP-96 check 152.02 & 152.05 that what we need to satisfy the requirement for acceptable schedule. 2. He cannot start work while & unless his schedule has been approved by us. 3. He told me he understand what we want. 4. I asked if he had any other questions. He replied no.

The second submittal was rejected by letter dated September 8, 1998 because it lacked a written narrative as required by the contract and as the Government had reminded WBC after the first submittal. iii) Submittal No. 3 On September 10, 1998, WBC again submitted the preliminary construction schedule; this time including a written narrative. The written narrative however lacked four of the nine elements required under the contract. The specific deficiencies were identified in the rejection letter from the Government to WBC dated September 10, 1998. iv) Submittal No. 4 The final submission of the preliminary construction schedule was faxed to the Government on September 11, 1998, but not received until September 14, 1998. The specific elements from the previous letter were addressed. A note in the file states that the preliminary construction schedule was verbally accepted on September 14, 1998. WBC was allowed to begin all construction work on September 15, 1998. g) Accident Prevention Plan As identified in the Preconstruction Conference Package letter, an accident prevention plan was required in accordance with FAR Clause 52.236-13. The accident prevention plan was received by the Government on August 31, 1998, and required no subsequent submittal. FAR Clause 52.236-13, Accident Prevention required submission of the accident prevention plan "before commencing the work." h) Quality Control Plan As identified in the Preconstruction Conference Package letter, a quality control plan was required in accordance with Standard Specification 153. The quality control plan dated September 2, 1998 was not received by the Government until September 8, 1998. It was determined to be acceptable and approved on September 8, 1998.

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Section 153, Contractor Quality Control and Quality Assurance, required submission of the quality control plan "before start of the work." By this contract requirement, work contractually could not begin until the quality control plan for that portion of work was provided and accepted. As stated under subsection 153.02, with prior approval, submission of a quality control plan for items of work not immediately scheduled to begin may be deferred. Nevertheless, in an effort to aid the contractor, the Contractor's Daily Record of Construction Operations (Contractor daily) verify the Government allowed work items such as mobilization, preliminary surveying, and installation of silt fence and straw bales to begin prior to receipt and acceptance of the quality control plan. i) Hazardous Spill Plan The contract required WBC to submit a Hazardous Spill Plan prior to construction under subsection 107.10 of the Special Contract Requirements. WBC submitted a Hazardous Spill Plan on September 15, 1998. j) Contract work performed prior to September 15, 1998 From the Contractor's Daily Record of Construction Operations, Form WFLHD 465, work was performed prior to September 1, and throughout the period of time in dispute. · · · Mobilization of equipment to the project site o August 29 thru September 2, 1998 Laborers installing silt fence and straw bales o September 2 thru September 15, 1998 Survey Subcontractors performing preliminary surveying from o August 31 thru September 4, 1998 o September 9 and September 12, 1998

Starting September 15, 1998, WBC was allowed to begin full construction operations as allowed under the contract.

2) Environmental Restriction Error by Paul Rettinger
Mr. Clevenger stated in his deposition that during a call when he complained to Mr. Rettinger about not getting an approved schedule, Mr. Rettinger stated that WBC could not begin work at Milepost (MP) 46.2 prior to September 15 because no clearing was allowed. Tr, Clevenger, 104:12-20. The contract did not allow clearing operations at MP 46.7 or between MP 47.07 and 47.25 on Forest Development Road (FDR) 33 during the time between August 6 and September 15. The contract did not restrict work at MP 46.2 during these dates.

3) Sajid Aftab was forced to sign letters written by Paul Rettinger
As identified in Mr. Aftab's daily diary entries, there are several entries where he identifies letters written by Mr. Rettinger; however he indicates in many of the entries that the letters were discussed with him prior to his signature. For instance, on September 24, 1998, his diary states, "Paul wrote & discussed with me serial letter no. 017 & I signed it."

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4) Paul Rettinger overturning agreements between Sajid Aftab and Luther Clevenger WBC makes a general allegation that there were verbal agreements made between Mr. Aftab and Mr. Clevenger concerning "pay estimates, items of work, and other items demanding attention," only to have Mr. Rettinger overrule Mr. Aftab later. WBC does not provide any specifics to support this claim. I only found one situation where one of the multitudes of miscellaneous pay item tickets was signed by Mr. Aftab and afterwards rejected by Mr. Rettinger because the ticket was not according to contract specifications. Tr, Aftab, 80:21-81:6. 5) Sajid Aftab requesting to be assigned to another project away from Rettinger In his October 21, 1998 diary entry, Mr. Aftab specifically recounts a conversation between himself and Mr. Crockett, the Government's Construction Operations Engineer. The excerpt from the diary stated the following: I told Paul my frustrations on this job. I am Project Engineer on this job, I am not making any decisions. I am not informed in which I expected has to come or go. I am only signing letters & feel that I am out of loop. I don't know why I am Project Engineer. Howe Crockett called (COE). I express my great displeasure regarding this job. I told him also that I am not being performing my duties as a P.E. Although Contractor's operations & performance is below average but we are also not helping to complete the job. I also asked Howe if he can pull me out of this job as I cannot perform my duties as Project Engineer. Inspectors are frustrated. Wayne told me that he don't agree w/ Paul's attitude towards Contractor & Paul is putting all effort is to stop this job. I told Wayne that's not true. I will talk to Paul but again I cannot promise you anything as I don't have authority on any issue. On October 30, 1998, Mr. Aftab expressed his frustration again on the project in his diary. His diary states the following: Told Paul again I need training in T&A & Estimate. Facts Arrived at the project around 10:00 am. Contractor is still placing the pipe & preparing bedding material for the last section of the pipe observe contractors operations. Bob Gietz told me that Jim told him that tomorrow on Oct. 31, they would be out of wetted perimeter & he is going to use riprap material which hasn't been approved for his energy dissipater. I told bob I will be here at job site tomorrow. Comments: Bob Gietz keep on insisting that he should inform Paul about the situation. I told him I can handle it but he keep insisting. Maybe Paul has given him some specific direction to contact him rather than me. I told him okay go head & tell Paul. Again, I am frustrated as I am not given an opportunity to get involved in project, writing letters, making decisions, scheduling inspectors at the job or even making spreadsheets for my job. When I came to this job as Project Engineer with understanding that Resident Engineer is there to help me not to run my job. Resident Engineer in the starting has given me an opportunity & slowly took over my job. I am not even being consulted regarding scheduling inspectors. If inspectors has any

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problem, they now go to Resident Engineer than I. I have not been trained or helped as a Project Engineer. I was always on the project. Spend very little time in office. So I have not achieved or not been able to get help from Resident Engineer to prepare myself for the future projects. In his deposition, Mr. Aftab was questioned if he asked to be transferred because of his problems with WBC, Mr. Clevenger personally, or Mr. Rettinger. Mr. Aftab answered, "There was no personal issue between you and me. All it was, was that you are the Contractor. We are seeing that this Contractor is not going to be done or completed. It was frustration on both sides, which always comes down ­ and again, this was my first project. That's why I wrote that statement in my diary. It frustrated me why the Contractor was not performing what he is supposed to perform according to the contract. That was my frustration. That's why I asked them to remove me from the project." He was asked specifically what problems he was having with Mr. Rettinger. Mr. Aftab replied, "Paul was not assigning me the assignment of a Project Engineer. That was a big frustration that I can tell you ­ these are all combinations of all these. The job was not going good. My boss is not giving me those assignments ­ which he's suppose to give me those assignments. That's how it, you know, happened." Tr, Aftab, 20:3-21:18 6) Inspectors' statements regarding Paul Rettinger's administration style or comments WBC claims that inspectors working on the project for the Government had made disparaging comments regarding Paul Rettinger's actions on the contract. a) Wayne Lowell WBC claims that one of the inspectors left the project largely because he had never seen Rettinger treat a contractor so harshly. Clarification was sought from WBC regarding the identity of this inspector they claim left under these circumstances, which they replied to identify him as Wayne Lowell. According to the Inspector Daily Reports, Mr. Lowell was on project from September 18, 1998 to October 29, 1998. The information within the Inspector Daily Reports do not relate to the statements as depicted by WBC. However, as identified by WBC in their email response for clarification, the Deposition for Mr. Aftab discusses Mr. Lowell's reasons for leaving. When asked why Mr. Lowell left the project, Mr. Aftab replied, "His wife was having some problems and she needed an operation." Mr. Aftab also stated, "He was also frustrated on the job and the real reason was because of his wife." When asked if Mr. Lowell said anything about Mr. Rettinger's conduct, Mr. Aftab answered, " He said that, "I don't know why Paul is so strict on the is job, while he was not so strict on other jobs." He has been with Paul for the last four or five years, so that's why." Tr, Aftab, 76:19-77:12 b) Mike Barber WBC also claims another inspector who was fired from the project indicated that Rettinger was deliberately trying to rid the Government of what he termed "problem contractors." This employee was identified by WBC as Mike Barber in a response to a request for clarification.

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In response to another request for clarification on this issue, WBC provided information they received from Mr. Barber's employer, CMTS, as Mr. Barber was a consultant inspector on the project, not an employee of the Government. In the information provide by CMTS, there is a letter to the file written by Mr. Barber to reflect his displeasure with his removal from the project, which is included as follows: As we discussed on 9-10-98, and in our following discussions, Paul Rettinger, FHWA, unlawfully voided my CMTS contract with the Federal Highway Administration on 9-10-98 without any warning or reason. He oddly asked me to return to the FHWA Office from my field assignment; and he was leaving the Office in his vehicle as I arrived when he suddenly voided the CMTS contract. He asked me to be gone by the end of the day. I asked for an explanation to his bizarre statement, and he said that Luther Clevenger, Construction Contractor, had told him "everything" that I said during our 9-8-98 meeting arranged by Mr. Rettinger. Since I had done nothing wrong during this 9-8-98 meeting, Mr. Rettinger's decision was still irrational. He refused any specific explanation. After Mr. Rettinger had quickly disappeared, I learned that he had maliciously slandered both Mr. Clevenger and I with his fabricated scenario of ­He said, I said-. I arranged a meeting with Mr. Rettinger for the following morning to receive documentation of his decision, but the following day Mr. Rettinger only continued his insane behavior. No dismissal documentation from anyone has been delivered to me yet, nearly four months later. Retrospectively, Mr. Rettinger's comment to the FHWA Office in mid-July, 1998 shortly after I had been assigned to work for him in Nesika Beach, Oregon that he would vindictively volunteer to be the project engineer on any construction project with a specific contractor which the FHWA had not liked in the past; and that he would make sure this contractor would never work for the FHWA again. This typified his inappropriate, hostile attitude towards my CMTS Contract with the FHWA. I am preparing a summary of Mr. Rettinger's unlawful actions from 7-6-98 to 9-11-98 in case the investigators need it per the following paragraph describing the 1998 U.S. Government Crime Case before the Ninth Circuit U.S. Court of Appeals. I am involved as a key witness in a June, 1996 legal action exposing criminal activity by the U.S. Government. My Fall of 1996, Summer of 1997, and Summer of 1998 Construction Inspection Assignments for the FHWA have been generally unaffected by this multi-million dollar legal action. After I was assigned to Mr. Rettinger in early July, 1998, he prejudicially performed his duties regarding my position in repetitiously malicious efforts to damage us. He has intimate knowledge of this extensive 1996 to 1998 U.S. Government legal action, and he repeatedly used this information in mocking, insulting statements and actions against me. I remained professional, prudent, and positive in my contractual duties throughout the projects minimizing any of his harm to the success of the construction projects. Although Mr. Rettinger's unlawful actions against me may seem to be employment discrimination; he has exposed himself as a criminal accomplice to the aforementioned criminal activity by the U.S. Government. I suspect that our construction contracting's involvement will be minimal, with the Judicial Authorities probably just including Mr. Rettinger's unlawful actions into their crime case investigation. I respect CMTS's decision of legal action regarding the