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CBCA Rules Contractor Under GWAC Task Orders Properly Submitted Claims to the Agency Ordering Contracting Officer Instead of the Procuring Contracting Officer

In a case of first impression, the Civilian Board of Contract Appeals (“CBCA”) ruled that a contractor performing task orders issued against a government-wide acquisition contract (“GWAC”) properly submitted its claims to the Agency Ordering Contracting Officer (“OCO”) instead of the Procuring Contracting Officer (“PCO”). The case – Sotera Defense Solutions, Inc. v. Department of Agriculture, CBCA 6029, 6030, 2019 WL 1977388 (Apr. 25, 2019) – involved two task orders issued by the Department of Agriculture (“USDA”) to Sotera Defense Solutions, Inc. (“Sotera”) for the provision of information technology (“IT”) support services at agency locations throughout the country. The USDA issued the task orders against a GWAC awarded by the National Institutes of Health (“NIH”). A GWAC, as explained by the CBCA in its decision, is defined by the Federal Acquisition Regulation (“FAR”) as a “task-order or delivery order contract for [IT] established by one agency for Governmentwide use.”

The GWAC awarded by the NIH delineated roles for both the PCO and the OCO, stating they were the exclusive government officials with authority to take actions that may bind the Government under the contract and task orders, respectively. In awarding the GWAC, the PCO made a determination that the positions under the contract were exempt from the Service Contract Act (“SCA”). However, the GWAC also advised that an OCO would have to determine whether the SCA applied to any positions requested under a task order. Accordingly, when the USDA OCO subsequently amended the two task orders issued to Sotera to add SCA coverage, Sotera submitted claims to the OCO requesting equitable adjustments for the added costs of complying with the SCA. After deemed denials of its claims, Sotera appealed to the CBCA.

On appeal, the CBCA requested the parties brief the issue of the Board’s jurisdiction, prompting the USDA to file a motion to dismiss on the ground that Sotera submitted its claims to the wrong Contracting Officer. In deciding whether Sotera should have submitted its claims to the PCO instead of the OCO, the CBCA noted that under FAR Part 8, disputes pertaining to the terms and conditions of an underlying schedule contract administered by the General Services Administration (“GSA”) must be brought to the GSA Contracting Officer rather than the OCO. The CBCA recognized, however, that “[a] GWAC is different from a schedule contract administered by the GSA,” and that under FAR Subpart 16.5’s ordering requirements for GWACs, there were “no similar provisions bifurcating responsibility for the resolution of disputes.” Thus, considering there were no cases in which this issue had been resolved, the CBCA was “left to decide this issue as one of first impression.”

To resolve the issue, the CBCA turned to “the terms of the contract and the nature of the dispute” for guidance. To this end, the CBCA emphasized that the GWAC assigned responsibility to the ordering agency for identifying any additional labor categories on a task order that are governed by the SCA. In addition, the CBCA noted the SCA coverage issues were raised originally by the Department of Labor to the USDA Contracting Officer, rather than the NIH Contracting Officer, because the alleged violations were task order specific and, presumably, because the USDA Contracting Officer had the funds to withhold. Finally, the CBCA found the terms of the GWAC permitted the OCO to bind the Government with regard to task order matters. Given these facts, the CBCA held Sotera properly submitted its claims to the OCO, thereby giving the CBCA jurisdiction over the deemed denials of those claims.

As the CBCA’s holding demonstrates, contractors performing task and delivery orders must be cognizant about not only the type of instrument governing their orders, but the terms of such instrument as well, when deciding to whom they must submit their claims. If an order were issued under a GSA schedule contract, then the contractor must follow the requirements of FAR Part 8 by bringing claims pertaining to order performance to the OCO, and bringing claims pertaining to the terms and conditions of the contract to the PCO. If, however, an order were issued under a GWAC, then to whom a contractor must submit its claims will depend upon the terms of the GWAC and the nature of the dispute. In Sotera, those terms and the nature of that dispute pointed to the OCO instead of the PCO. But under a GWAC with different terms, or given a different dispute, Sotera could very well have had to submit its claims to the PCO.

Of course, the FAR Council could eliminate this problem by simply promulgating a regulation that, like FAR Part 8 for GSA schedule contracts, clearly establishes bifurcated responsibility for the resolution of disputes on GWACs. But absent such a regulation, the determination of whether to submit a claim to the PCO or the OCO will remain a case-specific exercise. Consequently, contractors considering filing a claim on a GWAC order should work closely with their counsel to evaluate the terms of their GWAC and the nature of the dispute so that their claim winds up on the right official’s desk. Depending on (1) when the claim accrued, (2) the interval between the filing of the claim with the wrong contracting officer and the initiation of any appeal, and (3) the point in time when the issue is resolved by a board or the Court of Federal Claims, the wrong choice for the submission of the claim could well have statute of limitations implications for the contractor.

Copyright © 2019, Sheppard Mullin Richter & Hampton LLP.

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About this Author

John W. Chierichella, Sheppard Mullin Law Firm, International Trade Attorney
Partner

John Chierichella is a partner in the Government Contracts and Regulated Industries Practice Group in the firm's Washington, D.C. office.

Areas of Practice

Mr. Chierichella has a broad range of experience in government contract matters, including bid protests, claims and appeals, cost and CAS issues, teaming disputes, GSA's Multiple Award Schedule (MAS) Program, compliance reviews and internal investigations, and qui tam and other False Claims Act litigation.

202-218-6878
Adam A. Bartolanzo, Sheppard Mullins, government contracts litigation, FAR Counsil

Adam A. Bartolanzo is an attorney in the Government Contracts, Investigations & International Trade Practice Group in the firm’s Washington, D.C. office.

Mr. Bartolanzo’s practice focuses on government contracts litigation and counseling. His experience includes advising clients on small business set asides, assisting contract termination appeals, performing transactional due diligence specific to government contractors’ needs, and assessing client compliance with the FAR and other regulations.  He has represented both plaintiffs and defendants in commercial litigation before United States District Courts and state courts, and has experience in governmental investigations.

202-747-2643