June 2, 2017

CROOKED RIVER LOGISTICS LLC v. UNITED STATES POSTAL SERVICE

PSBCA Nos. 6618, 6643

APPEARANCE FOR APPELLANT
Jackie L. Gibbons and William K. Gibbons
Crooked River Logistics LLC

APPEARANCE FOR RESPONDENT
Peter J. McNulty, Esq.
United States Postal Service Law Department

OPINION OF THE BOARD ON
MOTION TO DISMISS FOR LACK OF JURISDICTION

The United States Postal Service moves to dismiss for lack of jurisdiction because Crooked River Logistics LLC neither filed a claim nor received a contracting officer’s final decision.¹ In the alternative, the Postal Service moves to dismiss because Crooked River’s appeals are really business disagreements.²  We grant the Motion.

FINDINGS OF FACT

1. On November 10, 2015, the Postal Service issued separate solicitations for transportation services between Portland and St. Paul, Oregon and between Portland and The Dalles, Oregon (AF 1, 11).
2. The solicitations incorporated by reference Highway Contract Route, Terms and Conditions, Issue 12 (Effective:  January 15, 2013).  The Terms and Conditions included Clauses 2.3.1m, Termination for Default; 2.3.3a, Termination with Notice; and 2.3.3b, Termination for the Postal Service’s Convenience.  (AF 1, 11, 23 at 80, 82-83).
3. The Terms and Conditions also included the Claims and Disputes clause (March 2006).  The clause defines a claim.
   “Claim” as used in this clause, means a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to this contract. . . . 
   For supplier claims exceeding $100,000, the supplier must submit with the claim the following certification:
   “I certify that the claim is made in good faith, that the supporting data are accurate and complete to the best of my knowledge and belief, that the amount requested accurately reflects the contract adjustment for which the supplier believes the Postal Service is liable, and that I am duly authorized to certify the claim on behalf of the supplier.”
   (AF 23 at 84).
4. On November 13, 2015, Crooked River submitted offers in response to the two solicitations (AF 2, 12).
5. On December 3, 2015, the Postal Service sent two award letters to Crooked River saying that “You have been awarded [Contract] HCR 97033 Portland [Processing and Distribution Center] P&DC, OR to St. Paul, OR.  Service begins on December 26, 2015.”  The second letter similarly provided “You have been awarded HCR 97040 Portland P&DC, OR to The Dalles, OR.  Service begins on December 26, 2015.”  The letters concluded with “Congratulations on being awarded additional transportation contracts.”  Both letters were signed by the contracting officer.  (AF 21, 22).
6. On December 8, 2015, the contracting officer telephoned Crooked River and explained that another contractor’s prices were lower and that Crooked River would not receive the contracts (Complaint at 2; December 16, 2015 email from Crooked River to the contracting officer).  On the same day, the Postal Service issued two letters to Crooked River with the subject lines:  “HCR No. 97033 – Corrected Notification of Contract Award” and “HCR No. 97040 – Corrected Notification of Contract Award[.]”  These letters identified a different contractor as the awardee.  (AF 9, 19).
7. On December 16, 2015, Crooked River sent an email to the contracting officer that provided, “[w]e would like to formally appeal your decision, in which you took away our contract awards five days after the awards.”  (Crooked River email, Dec. 16, 2015).
8. On January 8, 2016, Crooked River filed a Notice of Appeal with the Board which provided:  “We believe that the contract official acted in bad faith, with malice of ethics.  It is also our opinion that the contract official may have[] some unethical relationship with the [contract awardee announced on December 8, 2015] and it’s [sic] owners . . . .”  (January 13, 2016 Order). 
9. On March 31, 2016, Crooked River filed a second Notice of Appeal which provided:
   The nature of the Dispute is that [the contracting officer] never issued a final decision, nor did he entertain our formal appeal to him.  We received no further communication from him regarding our formal request of appeal and transparency. . . .
   Since the contracts were taken away verbally, by a phone call from [the contracting officer] five days after award to our company.  Also the contracts were cancelled with our company, without any contract default on our part.  We seek damages in the amount equal to the months of both HCR 97040 & 97033 pay equivalent.  We also seek damages of $350,000.00 for discrimination against our company, which is damaging to our reputation and future earning capacity.
   (March 31, 2016 Notice of Appeal).
10. On December 21, 2016, Crooked River filed its complaint which said that “[w]e appealed the decision cancelling our contracts to [the contracting officer] by email, however never received a response to that appeal.”  Crooked River went on to argue that it has been ignored by the Postal Service since it filed its appeals with this Board and has not received solicitation notices for new procurements.  The complaint did not identify a specific amount of money sought by Crooked River.  (Complaint).
11. The Board docketed the dispute related to Contract HCR No. 97033 as PSBCA No. 6618, and Contract HCR No. 97040 as PSBCA No. 6643, and consolidated the cases for processing (June 30, 2016 Order and Memorandum of Telephone Conference).

DECISION

The Postal Service awarded two contracts to Crooked River on December 3, 2015 (Finding 5).  A few days later, the Postal Service notified Crooked River that the awards were being made to another contractor (Finding 6). 
Crooked River’s correspondence, taken as a whole, evidences its intent to challenge the Postal Service’s failure to honor its contract awards to Crooked River (Findings 9, 11).  In short, Crooked River alleges that the Postal Service cancelled the two contracts in bad faith and seeks more than $350,000 in damages.  Crooked River is also unhappy that the transportation contracts were awarded to another contractor. 
The Postal Service moves to dismiss for lack of jurisdiction for two reasons.  First, the Postal Service argues that Crooked River did not file certified claims and obtain contracting officer final decisions.  Second, it argues that Crooked River’s appeals are business disagreements over which we do not have jurisdiction. 
The Board’s jurisdiction in this case derives from the Contract Disputes Act (CDA).  41 U.S.C. §§ 7101-09; Stine v. United States Postal Service, PSBCA No. 6607, 16-1 BCA ¶ 36,510.  With regard to the first argument, the CDA provides that “[e]ach claim by a contractor against the Federal Government relating to a contract shall be in writing” and “shall be submitted to the contracting officer for decision.”  41 U.S.C. § 7103(a).  Binding precedent provides:  “[a]s a prerequisite for the Board’s jurisdiction, the CDA requires a contractor to present a valid claim over which the contracting officer has rendered a final decision.”  Parsons Global Servs. Inc. ex. rel. Odell Intern., Inc. v. McHugh, 677 F.3d 1166, 1170 (Fed. Cir. 2012); 41 U.S.C. § 7103.  The CDA also provides that if the claim is for more than $100,000 it must be certified.  41 U.S.C. § 7103(b); see also Finding 3.
“Absent this ‘claim’, no ‘decision’ is possible and, hence, no basis for jurisdiction” before this Board exists.  Paragron Energy Corp. v. United States, 645 F.2d 966, 971 (Ct. Cl. 1981), aff’d 230 Ct. Cl. 884 (1982); see also Stine, 16-1 BCA ¶ 36,510.  In its filings with the Board, Crooked River seeks more than $350,000 (Finding 9).  The record, however, does not include a claim, let alone a certified claim, submitted to the contracting officer for final decision.  See 41 U.S.C. § 7103(b).
Even if we were to try to construe the second Notice of Appeal as a claim, we could not do so.  The lack of a certification is not a correctable defect.  See URS Energy & Constr., Inc. v. Dept. of Energy, CBCA No. 2589, 12-1 BCA ¶ 35,055 (the absence of a statement that “the claim is made in good faith” is not correctable); Eurostyle Inc., ASBCA No. 45934, 94-1 BCA ¶ 26,458 (“complete absence of any certification is not a mere defect which may be corrected”).  Because Crooked River has not submitted a certified claim and the contracting officer has not had the opportunity to issue a final decision, we lack jurisdiction.  Shawn G. Logan, PSBCA No. 6507, 14-1 BCA ¶ 35,609 (“Without a monetary claim submitted to the contracting officer, the Board has no jurisdiction over a challenge to a termination for convenience or a termination with notice action.”).
With regard to the second argument, we do not have jurisdiction to hear a business disagreement challenging the award of a contract to a competing contractor.  See Finley v. United States Postal Service, PSBCA No. 6606, 17-1 BCA ¶ 36,667; Frank Baiamonte, PSBCA No. 5332, 08-1 BCA ¶ 33,796.  To the extent that Crooked River seeks our review of the contract award decisions, we dismiss the appeals.

CONCLUSION

The Postal Service’s Motion to Dismiss is granted.  The appeals are dismissed without prejudice.  Crooked River may submit to the contracting officer for final decision properly certified (if over $100,000) claims for the payment of money in a sum certain.

Peter F. Pontzer
Administrative Judge
Board Member

I concur:
Gary E. Shapiro
Administrative Judge
Chairman

I concur:
Alan R. Caramella
Administrative Judge
Vice Chairman