Free Response - District Court of Federal Claims - federal

Case 1:98-cv-00720-GWM

Document 396-2

Filed 11/14/2005

Page 1 of 4

APPENDIX OF ARGUMENTS WHICH DEFENDANT RAISES ON MULTIPLE OCCASIONS IN ITS BRIEF AND PLAINTIFF'S RESPONSE TO THEM D's Argument Page of D's Brief Where First Raised 6 Additional Pages of D's Brief Where the Argument was also Used Page in Brief Summary of Plaintiff's Plaintiff's Position Response Brief Where the Argument is Rebutted 5 Government has no such right here and this Court never held that it did.

Government had the ability to suspend Precision Pine's contracts with impunity for a period not substantially exceeding 135 days.

24 25 (re: damages due to the suspension of the Mud sale); 26 (re: damages due to the suspension of Manaco); 33 (re: the calculation of lost profits generally);

Precision Pine's mill inefficiencies were due to the cancellation of the Campbell and Barber contracts. Precision Pine's mill inefficiencies include claims for the brief unavailability of St. Joe and HutchBoondock. Precision Pine's mill inefficiencies were due to its "deferral" of harvesting on other contracts.

8

50 (re: sawmill damages) 54

Precision Pine's initial brief at page 54

The cancellation of these controversial sales allowed other sales to be released. These sales were harvested during the suspension, thereby reducing Precision Pine's mill inefficiency claim. Thus, no mill inefficiency claim is made for these sales. To the extent that available timber was not harvested during the suspension, this mitigated Precision Pine's damages.

15

55

56

15

55

Precision Pine's initial brief at 53

1

APPENDIX 1

Case 1:98-cv-00720-GWM

Document 396-2

Filed 11/14/2005

Page 2 of 4

D's Argument

Page of D's Brief Where First Raised 21

Additional Pages of D's Brief Where the Argument was also Used

Precision Pine's mill inefficiencies were due to Precision Pine's friendly default of the Park timber sale with the State of Arizona. Increased sawmill costs are not recoverable at common law under Scott Timber. Various of Precision Pine's damages are not recoverable because Precision Pine had no longterm operating plans. The Mud sale could not been harvested due to the pendency of other litigation. The Manaco sale could not have gone forward due to contractual restrictions. Many contracts were unavailable during the months in which timber harvesting was projected.

54

Brief Summary of Page in Plaintiff's Position Plaintiff's Response Brief Where the Argument is Rebutted Precision There was a dispute as Pine's initial to the volume on the brief at 55 sale; defendant presented no evidence that any volume remained to be harvested. 58 Defendant has already lost on this issue twice; Scott Timber is limited to its facts and was decided under clause C6.01. Flexibility was an asset to Precision Pine, Precision Pine operated profitably every year for more than a decade with no such long-term plans. No other litigation prevented Mud from being harvested. The evidence is to the contrary.

22

51, 52, 53

24

51 (Precision Pine had no long term plan for operating its sawmills)

15

25

54

18

26

54

19

27

54

Precision Pine's initial brief at 53

To the extent that available timber was not harvested, this mitigated Precision Pine's damages.

2

Case 1:98-cv-00720-GWM

Document 396-2

Filed 11/14/2005

Page 3 of 4

D's Argument

Page of D's Brief Where First Raised 33

Additional Pages of D's Brief Where the Argument was also Used

The lumber market was depressed during "most" of the suspension period. "Most" of the contracts were unprofitable during the suspension period.

22, 32, 54

42

22 (based on depressed lumber prices and no outlet for roundwood); 43 (erroneously attributing roundwood logging & hauling costs to Precision Pine);

Brief Summary of Page in Plaintiff's Position Plaintiff's Response Brief Where the Argument is Rebutted 12 The market bottomed in January-February 1996, i.e., in the first third of the suspension, and rose steadily thereafter. 12 See Precision Pine's comments on DPFF ¶¶ 583-91, demonstrating that defendant has not shown that any contract was unprofitable.

It had become apparent that Precision Pine was almost certainly going to have to close one of its sawmills. Defendant is entitled to a credit for any profits made (or benefit achieved) by Precision Pine's processing of the breached timber in the postsuspension period because the suspension merely delayed performance and Precision Pine is not a lost volume seller.

50

54 54

28 n.40

The letter to which defendant cites, DX 463, says nothing of the sort.

50

20 (suspension merely delayed Precision Pine's performance); 29, 30 (lost profits not foreseeable because suspension merely delayed Precision Pine's performance); 55 (re: entitlement to recoup hypothetical "gains" in efficiency on postsuspension period)

8

Precision Pine lost the opportunity to operate profitably during the suspension. Absent the suspension, Precision Pine could have operated profitably on the breached sales and on new sales thereafter, thus earning a second profit. Precision Pine was, by definition, a lost volume seller.

3

Case 1:98-cv-00720-GWM

Document 396-2

Filed 11/14/2005

Page 4 of 4

D's Argument

Page of D's Brief Where First Raised 50

Additional Pages of D's Brief Where the Argument was also Used

Precision Pine should have derived rates for logging and hauling on each sale by referencing the total amount indicated in its financial statement for the fiscal year and dividing that number by the total volume estimated by the Forest Service removed during the fiscal year. In one form or another Precision Pine lost profits should be tied to Mr. Porter's July 17, 1995 profit projections. Restitution and a suit for damages are alternative remedies. The fact that three contracting officers of limited experience never received claims for certain items proves that those items were not foreseeable by the Forest Service.

60-61

Brief Summary of Page in Plaintiff's Position Plaintiff's Response Brief Where the Argument is Rebutted 41 Rates set out on individual logger pay sheets are more reliable. Defendant's approach compares apples (costs on Precision Pine's financial statements) with oranges (Forest Service TSSA volumes).

50

31, n. 17 (Mr. Ness should have based his calculations on them)

15, 25

The projections were a worst case scenario and were never supposed to assess the actual profitability of the sales. Precision Pine does not seek restitution. Its damage claims are fully compatible. Precision Pine's damages were foreseeable to it (and foreseen by) the Forest Service at the time of contracting and at the time of breach. The limited experience of these contracting officers is irrelevant.

50

62

10-11

52

59 (increased log hauling cost after an suspension)

58

4