Where oh Where? Choosing the Correct Forum for Government Contracts Disputes

If a government contractor has a bone to pick, figuring out who to complain to can feel a lot like a customer service phone tree. If you press three instead of one, you can find yourself being transferred to another department after hours of being on hold. Or you can get completely different answers depending on who you speak to.

Several years ago, we wrote about a case we handled in which we resuscitated a contractor’s claim that had been rejected by the Civilian Board of Contract Appeals. See SecTek, Inc. v. Nat’l Archives and Records Admin., CBCA No. 5084-T (August 3, 2016) (on reconsideration dismissing appeal and withdrawing prior adverse decision for lack of jurisdiction). It turns out that all involved viewed the dispute as a contract claim when, in fact, it was a dispute over the interpretation of the Service Contract Labor Standards (“SCLS”) law and regulations and not a price adjustment under the contract’s SCLS price adjustment clause. If it was a contract claim, then the CBCA was one (not necessarily the only) correct forum for appealing the Contracting Officer’s adverse decision in that case. However, since the dispute actually was an SCLS dispute and not a contract claim per se, the only forum for resolving the dispute was the Department of Labor (“DOL”). The choice of forum proved crucial because DOL’s ruling ultimately carried the day for the contractor.

This all came to mind because of a ruling in a recent case before the Armed Services Board of Contract Appeals (“ASBCA”). See Appeal of DLT Solutions, Inc., ASBCA No. 63069 (May 26, 2022). This case involved a dispute arising out of an order issued by the U.S. Marine Corps to a Federal Supply Schedule (“FSS”) contractor for the provision of software licenses and support services. One of the key issues in the case was whether the contractor had submitted its claim to the correct agency.

In a garden variety federal contract dispute, there’s a single contract issued by a single federal agency Contracting Officer. Sometimes an agency will issue an Indefinite Delivery/Indefinite Quantity (“ID/IQ”) contract; in that case, there are two documents that form the contract, but there’s still a single agency and Contracting Officer. However, in cases like DLT involving an FSS contract dispute, the dispute can arise under contract terms that are awarded by two (sometimes more) agencies. A General Services Administration (“GSA”) Contracting Officer awards the FSS contract that applies to all orders, but an individual contracting agency Contracting Officer awards the order. The Order will have its own contract terms (for example the Statement of Work, Specifications or other order-specific provisions). These are in addition to, but not in lieu of, the FSS contract.

In DLT, the contractor presented a claim to the Contracting Officer that, on its face, seemed to arise completely under the terms of the Order and not the FSS contract. At the ASBCA, the Marine Corps sought to dismiss the claim based on its assertion that the claim should have been submitted to the GSA Contracting Officer since the claim implicated several issues that implicated the FSS Contract.

If the Marine Corps’ argument was correct, the contractor would need to start over—completely—and submit the claim to the GSA Contracting Officer. If the contractor disagreed with the GSA’s decision, then it would have to appeal to the CBCA, not the ASBCA. Finding the Marine Corps’ arguments “meritless,” the ASBCA determined that the appeal did not implicate the FSS contract, that the contractor’s claim was properly presented to the Marine Corps Contracting Officer, and that the ASBCA could proceed with the appeal on the merits of the claim. I’m sure that contractor breathed a sigh of relief on that one.

In both the SecTek and DLT cases, one can see that choosing the proper forum can make a huge difference. Going down the wrong path can waste time and expense—think in terms of years and thousands of dollars. You might even lose your claim altogether if the time to bring your claim has expired. Also, keep in mind that more than one forum might be available to you. For example, bid protests can be presented to the Contracting Officer, the Government Accountability Office, or the Court of Federal Claims (“COFC”). Contract appeals can be brought to the CBCA, ASBCA, or the COFC.

Each pathway has its own prerequisites, deadlines and pitfalls. Oftentimes, it’ll be easy to figure out where to go; however, we urge you to beware of the apparent “obvious” choice—it might just be wrong.