IMS ENGINEERS-ARCHITECTS, P.C. v. USA

Filing 49

PUBLISHED OPINION Granting in part as to Counts 2 and 3, and denying in part as to Count 1 Defendant's 25 Motion for Partial Summary Judgment; denying Plaintiff's 27 Cross-Motion for summary judgment. Joint Status Report by July 27, 2009, re pretrial proceedings trial to commence at 10:00 a.m. on Mon., Dec. 14, 2009, in New York City. Any additional dispositive motion by Oct. 20, 2009, and briefing will be expedited. Signed by Judge Christine O.C. Miller. (smg)

IMS ENGINEERS-ARCHITECTS, P.C. v. USA

Doc. 49

In the United States Court of Federal Claims
N o . 07-291C (Filed June 26, 2009) *********************** IMS ENGINEERS-ARCHITECTS, P .C ., Plaintiff, v. T H E UNITED STATES, Defendant. *********************** * * * * * * * * * * * * * *

C o n tra c ts; summary judgment; In d e f in ite Delivery, Indefinite Q u a n tity contract; breach of c o n tra c t; breach of duty of good f a ith and fair dealing.

J o s e p h A. Camardo, Jr., Camardo Law Firm, Auburn, NY, for plaintiff. Robert C. Bigler, Washington, DC, with whom was Assistant Attorney General Tony W e st, for defendant. Richard White, District Trial Attorney, and Christine Jacoby, Assistant D is tric t Counsel, U.S. Army Corps of Engineers, Baltimore, MD, of counsel. MEMORANDUM OPINION AND ORDER M I L L E R , Judge. T h is case is before the court on defendant's motion for partial summary judgment and p la in tif f ' s motion for summary judgment complete. Other than calling for rulings on the q u o tid ia n issues of burdens and inferences on summary judgment, defendant's motion seeks to eliminate claims related to two contracts in order to isolate them from the claim that the G o v e rn m e n t exercised bad faith in a continuing course of conduct stemming from an earlier c o n tra c t. Plaintiff's cross-motion quixotically attempts to create a breach of a contract w h e re b y the Government allegedly agreed to buy more than the minimum quantities under th e two later contracts in order to atone for its bad faith associated with the earlier contract. A rg u m e n t is deemed unnecessary.

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FACTS IM S Engineers-Architects, P.C. ("plaintiff"), is a consulting engineering firm with e x p e rie n c e as a government contractor. Defendant's motion for partial summary judgment a d d re ss e s two contracts between plaintiff and the Government, Contract No. DACA31-920 0 4 6 ("Contract 0046") and No. DAC31-95-D-0057 ("Contract 0057"). A third earlier c o n tra c t between parties, No. DACA87-92-C-0004 ("Contract 0004"), not the subject of d e f e n d a n t's motion, has potential significance based on the nature of plaintiff's complaint. P la in t if f moved for summary judgment on its claims under all three contracts. O n December 24, 1991, the Huntsville Division of the Army Corps of Engineers (the "C o rps" ) awarded plaintiff Contract 0004 to conduct Resource Conservation and Recovery A c t facility investigations at the Watervliet Arsenal ("Watervliet") in New York State. C o n tra c t 0004 was a fixed-price contract for $859,663.00. Subsequent modifications to the c o n tra c t increased its value to $1,406,320.00. Plaintiff was awarded Contract 0046 on September 30, 1992. Unlike Contract 0004, w h ich was a fixed-price contract, Contract 0046 was an Indefinite Delivery, Indefinite Q u a n tity ("IDIQ") contract. Contract 0046 had a minimum obligation of $100,000.00 and a maximum contract amount of $3 million. Between 1992 and 1994, plaintiff received m u ltip le task orders totaling $654,665.00. Contract 0046 expired on September 30, 1997. P la in tif f earned high performance ratings for work under Contract 0046 and, at least on one o c c a sio n , after completion of a project order on April 10, 1994, garnered an "excellent" ra tin g and was recommended for future contacts. Def's Resp. to Pl.'s Prop. Findings of U n c o n tr. Fact No. 12, filed May 1, 2009. Plaintiff was awarded Contract 0057 on June 30, 1995. Like Contract 0046, Contract 0 0 5 7 was an IDIQ contract. Contract 0057 had a minimum obligation of $15,000.00 and a m a x im u m contract amount of $750,000.00. By Contract 0057's expiration in June 1997, the C o r p s awarded plaintiff two delivery orders under Contract 0057 that totaled $166,710.00 a c co rd in g to defendant, and $130,676.00 according to plaintiff. P la in tif f 's contention, which defendant asserts is unsupported by evidence, is that the C o rp s pressured plaintiff to work quickly and to complete Contract 0004 in a limited period o f time. Plaintiff's performance under Contract 0004 was criticized in a subsequent audit r e p o r t, published in February 1994, as follows: IM S [ 's ] contract performance [under Contract 0004] was unsatisfactory; an on t im e completion would not be met; and that New York State and E n v ir o n m e n t a l Protection Agency sanctions could occur . . . These 2

c o n tra c t file documentation comments indicate a potential for a default te rm in a tio n . . . . P l.'s Br. filed Apr. 3, 2009, App. 127 ("Pl.'s App."). In light of the criticism of plaintiff's p e rf o rm a n c e on Contract 0004, a transfer of Contract 0004 to Baltimore, Maryland, and other f a cto rs , the Corps terminated plaintiff from all duties under Contract 0004. A series of unsigned Corps internal communications regarding Contract 0004 lists e v e n ts ultimately leading to the termination of plaintiff's involvement with, and the re a ss ig n m e n t of, Contract 0004. On February 24, 1994, representatives from Watervliet, the H u n ts v ille Division, and the Baltimore District of the Corps met to discuss "using an AE [ a rc h ite c t/ e n g i n ee rs ] firm other than IMS to perform [Contract 0004]." Pl.'s App. at 148. O n August 8, 1994, Watervliet formally requested that plaintiff be terminated on Contract 0 0 0 4 . Watervliet's request was communicated through an August 8, 1994 letter from Russell G . Wells, Director of Public Works at Watervliet, to the Corps Commander, requesting "your c o n tra c t with IMS for all work at Watervliet Arsenal be terminated." Pl.'s App. at 160. The C o m m a n d e r of the Baltimore District of the Corps then requested proposals for the remaining C o n tra c t 0004 work from Malcolm-Pirnie ("MP"), a large company with prior experience w o r k in g under similar contracts with the Corps. On August 10, 1994, plaintiff's President, Iqbal Singh, met with Lieutenant Colonel (" L T C " ) Ralph H. Graves of the Baltimore District to discuss plaintiff's qualifications and to communicate its interest in continued work on Contract 0004. Plaintiff contends ­ an a ss e rtio n defendant disputes as speculative and misleading, see Def.'s Resp. to Pl.'s Prop. F in d in g s of Uncontr. Fact No. 25 ­ that during August 1994 plaintiff informally was told that C o n tra c t 0004 was going to be terminated. In response, on August 11, 1994, Mr. Singh sent th e Corps a letter exhorting plaintiff's credentials in support of its ability to fulfill Contract 0 0 0 4 . Jim Sherman, an employee at Watervliet, forwarded Mr. Singh's letter to Corps P r o je c t Manager Charles R. ("Dick") Strong. On the facsimile cover sheet, Mr. Sherman w ro te : "Our position is that Malcolm-Pirnie is our contractor and Baltimore is our executor." P l.'s App. at 161. In an August 11, 1994 letter to Contracting Officer Danny J. Biggs of the H u n ts v ille Division of the Corps, the Small Business Administration (the "SBA") suggested tr a n s f e rr in g Contract 0004 to the Baltimore District as preferable to termination. The August 1 1 , 1994 letter from the SBA contains a handwritten note stating "you cannot terminate w ith o u t going thru the SBA, must have strong supporting documentation." Id. at 163. LTC Graves wrote two notes in response to the SBA's August 11, 1994 letter. One n o te to COL Randall R. Inouye, states:

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I have talked to you about this one. Despite [the August 11, 1994 SBA le tte r ], we intend to switch to Malcolm Pirnie for the work [under Contract 0 0 0 4 ] at Watervliet. We will try to soften the blow by arranging for IMS to be a sub to MP. We will inform SBA of our decision. Id. at 164. LTC Graves wrote another note, dated August 22, 1994, to Corps Contracting O ff icer M. Catherine Robertson. "Now that SBA has sent us a letter, we need to answer. A s you prepare the letter for Huntsville we discussed Friday, also prepare a version for COL In o u ye 's signature in answer to the attached." Id. at 165. In connection with the note s u g g e stin g to "soften the blow" to plaintiff, another note, dated August 19, 1994, from C o n tra c tin g Officer William C. Ryals, to Greg Mathews of MP, stated that it was "a go to u s e our recommended 8(a) sub[contractor] at Water[vliet] NY." Id. at 167. Also, on August 1 9 , 1994, MP offered to pay plaintiff for approximately one-quarter of the work at W a te rv lie t, previously under Contract 0004, if plaintiff agreed to act as subcontractor. On A u g u st 31, 1994, before plaintiff responded to MP's offer, the SBA wrote another letter to th e Corps, stating, in relevant part: It is well documented on this contract [Contract 0004] and numerous o th e rs that IMS, performs in a professional and satisfactory manner, with no d o cu m en ted delays. IMS, P.C. has our full support. This office is not aware o f any information that would justify the termination of this contract. T h e major concern here is the proposal to terminate IMS and assign the re m ain d e r of the work on this project to a large business [MP]. The two a la rm in g issues are [these]: That the U.S. Army Corps of Engineers, or any a g e n cy would take such measures, to the detriment of a small business, without s o u n d justification, and, assign the work to the task order of a large business c o n c ern without competition. T h i s proposal appears to contradict many federal acquisition guidelines. W e are requesting that IMS be permitted to complete this project under the te rm s and condition of the existing contract [(Contract 0004)]. Pl.'s App. at 168. Plaintiff rejected MP's offer to act as a subcontractor on September 2, 1 9 9 4 . Contract 0004 officially was transferred from the Huntsville Division of the Corps to the Baltimore District on September 30, 1994. Defendant disputes plaintiff's allegation that the Government has been unable to p ro d u c e any documentation to show deficient performance by plaintiff under Contract 0004. D e f en d a n t counters that an Audit Letter Report covering the subject contract issued on 4

F e b ru a ry 2, 1998, Pl.'s App. at 122-43 ­ characterizing plaintiff's contract performance as " u n sa tis f a cto ry," predicting that an on-time completion would not be met and that sanctions co u ld occur, and containing 99 pages of comments on deficiencies by the State of New York ­ constitutes documentary support of plaintiff's substandard performance on Contract 0004. P lain tiff describes the Audit Letter Report as evidence that the Corps based its decision to re p la c e plaintiff on reasons other than performance. Plaintiff highlights language stating " IM S was not the first choice contractor of USACE staff or our customers and at times their tim elin ess was questioned. However, formal USACE performance appraisals rated IMS w o rk acceptable or better." Pl.'s App. at 123. Plaintiff asserts that the Corps replaced it with MP out of "animus," specifically t o w a rd s Mr. Singh and foreign workers employed by plaintiff. Pl.'s Prop. Findings of U n c o n tr. Fact Nos. 37, filed Apr. 3, 2009; see also Nos. 38-41. Plaintiff cites a handwritten m e m o r a n d u m dated August 31, 1994, with notes from a telephone call with Mr. Sherman at W a te rv lie t: "IMS is hard to negotiate w[ith], change orders are overpriced, [IMS] employs n o n -U S citizens that must be escorted at WVA & they do not have the manpower to do this e x tra effort . . ." Pl.'s App. at 170. While agreeing that this language is included, defendant justifies concerns about nonU n ited States employees of plaintiff based on defendant's response to an interrogatory: Because of its national defense mission, the Watervliet arsenal is deemed a s e c u re facility, requiring non-citizen contractors to be escorted about the p re m is e s by authorized Government representatives. Representatives from W a te rv lie t explained that some employees of IMS were foreign nationals and, th u s, were unable to get the security clearances necessary to access the site w ith o u t escorts. Watervliet lacked the manpower necessary to escort IMS p e rs o n n e l whenever needed. Def.'s Resp. to Interrog. No. 5, Pl.'s App. at 11-12. Plaintiff counters that no proof has been o f f ere d that its employees were ever escorted at Watervliet, or that there was an escort policy a t Watervliet prior to 2002. In response defendant references a fact sheet ­ "IMS Engineers' C o n tra c t at Watervliet Arsenal," dated March 1, 1995, with a bullet stating: On 31 August 1994, Chris Correale spoke with Jim Sherman, Project OfficerW V A . Mr. Sherman indicated that IMS is hard to negotiate with, change

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o rd e rs are overpaid, employs non-U.S. citizens that must be escorted at WVA an d WVA does not have the manpower to do this extra effort. [1/] Pl.'s App. at. 155-56. Although plaintiff had employees of foreign birth or Asian decent, p la in tif f asserts that all employees at Watervliet were United States citizens or legal p e rm a n e n t residents. Affidavit of Iqbal Singh, Apr. 3, 2009, ¶ 26. Mr. Singh avers that he tra v e le d to Watervliet several times and only recalled workers and visitors having to sign in. Id . ¶ 27. P lain tiff refers to a series of correspondence as evidence that the Corps unjustifiably re f u se d to work with plaintiff. According to plaintiff, a Corps e-mail dated August 31, 1994, illu s tra te s an intent to deceive the SBA regarding the Corps's plan to take work away from p la in tif f : P e n n y Cincibus, Assistant to Pat Huber, received a call from Jim Branch, who is the KG with SBA on the IMS contract on 29 Aug. He is very upset and " a p p ea rs " to be leaning towards making lots of trouble for us if we do not take the IMS contract. He indicated nobody has convinced him as yet, why IMS s h o u ld not be given this work. He is also very upset that we would go to a L A R G E BUSINESS contractor in lieu of the awarded 8(a) for the work I also to ld him this was not a contracting decision and made at levels above us. My p o s itio n on this is to try and convince SBA that we are trying to avoid any e c o n o m ic problems for IMS which is the reason we have Malcolm trying to n e g o tia te with them on doing this work. So far, SBA has not been convinced o n this issue. Pl.'s App. at 171. Plaintiff also cites to a September 1, 1994 e-mail captioned "The C o n tin u in g Saga of IMS vs Malcolm," sent by Contracting Officer Robertson. Pl.'s App. at 1 7 4 . Plaintiff focuses specifically on one paragraph: W H A T A MESS!! Jerry spoke with Mr. Jim Reynolds yesterday. He is the D ire c to r of Contracting for HND. Mr. Reynolds indicted they do not have a s tro n g position to T4D [terminate for default] nor can they support a T4C

1/ Defendant relies on language from Pl.'s App. at 156 as proof of an escort policy a t Watervliet. However, once plaintiff relies on the same fact sheet, defendant dismisses it b e c au s e the document "has not been authenticated nor signed by an author," but does not d is p u te that the language appears in the document. Def.'s Resp. to Pl.'s Prop. Findings of U n c o n tr. Fact No. 43. 6

[ ter m in a te for cause] since the requirement for the work at WVA is still n e c es s a ry. However, Mr. Reynolds indicated they would not transfer the c o n tra c t to BDO if we did not want it. Mr. Biggs, Sherry Higgins, HND O f f ic e of Counsel, and Mr. Reynolds are meeting on this issue this afternoon. . . . In the meantime, the clock ticks . . . . Pl.'s App. at 174. Plaintiff calls attention to the mention of Mr. Biggs of MP and LTC Graves and COL In o u ye in the September 1, 1994 email, thus showing that this decision was made at the h ig h e s t levels of the Corps. A different September 2, 1994 e-mail from Christina E. Correale, Hazardous Waste C h ie f of the Baltimore District, communicated that Jeff Bennett, the Vice President of MP, h a d called to inform the Corps that plaintiff had refused MP's offer to serve as a s u b c o n tra c to r. A September 7, 1994 e-mail from LTC Graves to Contracting Officer R o b e rts o n stated, "We still need to send a letter over COL Inouye's signature to Mr. Branch o f SBA telling our intention on IMS." Pl.'s App. at 176. A September 12, 1994 letter from C O L Inouye to Elizabeth J. Perno of the SBA explains why Contract 0004 was transferred f ro m plaintiff to MP: W h i le we cannot meet the needs of our customer by taking over the IMS c o n tra c t from Huntsville division, we very much want to contract through the S m a ll Business Administration with IMS for other work in the area during the c o m in g Fiscal Year. .... Meanwhile, we and the installation have largely revised the workplan s u b m itte d by IMS and negotiated approval from regulators. This revised plan w ill be substantially less expensive than the one proposed by IMS. We shall a w a rd a delivery order for the investigation described in the revised workplan to Malcolm-Pirnie (a competitively awarded contract through our A-E s e le c tio n procedures) with expiring money before the end of September. To m o d if y the IMS contract to perform the revised workplan would take several m o n th s , placing the installation in violation of its consent agreement and ris k in g large fines. ....

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W e encouraged Malcolm-Pirnie to offer a subcontract to IMS, but apparently IM S did not consider the opportunity favorably. We are always interested in d o in g business with qualified 8(a) firms, and therefore you will soon receive an offering letter recommending IMS as a candidate for an indefinite-delivery co n trac t with the Baltimore District for environmental work in the New York a re a . . . . [w]e look forward to doing other work with you and with IMS in the c o m in g year. Pl.'s App. at 177-78. Plaintiff emphasizes that these letters weave a pretense that plaintiff was terminated b e c au s e of a change of scope in the contract and cites to a Government Chronology of D o c u m e n ted Significant Events recording that, in September of 1994, "Malcolm-Pirnie is a w a rd e d six Delivery Orders totaling $1.1 Million [] by Baltimore District. The scopes of w o rk are essentially the same as the IMS contract scope of work." Pl.'s App. at 144. By M o d P00005, dated September 13, 1994, Contract 0004 formally was transferred from the H u n ts v ille Division to the Baltimore District. Plaintiff did not agree to a termination settlement until October 8, 1996. Plaintiff also s i g n e d a termination modification on November 14, 1996, and a subsequent release on D e c em b e r 23, 1996. During plaintiff's search for government contract work to replace the v a lu e of the remaining work on Contract 0004, plaintiff claims that it was "blacklisted" by th e Corps, Pl.'s Prop. Findings of Uncontr. Fact No. 61; adversely affected by "personal a n im u s " to plaintiff by the SBA, id. No. 72; and dealt with by the Corps in a "cynical nature," id. No. 78. Moreover, plaintiff suggests that racial prejudice played a role in plaintiff's in a b ility to secure work, because Mr. Singh is a Sikh with "darker skin and wears a re lig io u s ly mandated turban." Singh Aff. ¶ 61. As support plaintiff refers to the project o rd e rs issued under Contract 0046 and Contract 0057 and a series of communications leading u p to the official settlement and termination agreement for Contract 004. Although defendant characterizes other contracts as irrelevant to any contract at issue in this litigation, plaintiff argues that the contracts awarded to plaintiff's peer contractors b e tw e e n 1994 and 1997 constitute evidence of bias against plaintiff. Plaintiff charges that th e Corps exceeded the allowable amount in a contract with a firm called Plexus and that the C o rp s reached the limit with another firm called Horne Eng, both contract awards above $4 m illio n . See Singh Aff. ¶ 65. Plaintiff produces a number of internal communications within the Corps that address h o w the Corps planned to deal with plaintiff. A September 20, 1994 note from Contracting O f f ic e r Robertson states that the Corps "need[s] to discuss what/how we are going to T4C 8

[ te rm in a te for convenience] this contract." Pl.'s App. at 182. A September 26, 1994 m e m o r a n d u m from Ms. Correale to Patricia A. Huber, an SBA advocate, suggests that the E n g in e e rin g Division and Ms. Robertson agreed that plaintiff should get a new contract " stru c tu re d with a maximum of $750k total per year for the base year and one option year at a maximum of $750k and a maximum of $150k delivery orders." Pl.'s App. at 183. In a S e p te m b e r 30, 1994 letter to the SBA, Ms. Huber recommended award to plaintiff. The SBA ac ce p ted the offer on behalf of plaintiff in an October 5, 1994 letter. A c k n o w le d g in g that Contract 0004 had yet to be terminated, LTC Graves wrote a le tte r to COL Inouye discussing the disposition of Contract 0004 and plaintiff: A s you remember, this contract has been superceded by an award we m a d e to Malcolm-Pirnie for the work at Watervliet. We intend to Terminate [ p la in tif f ], but haven't done so yet. We are working with SBA to give [ p l a in t if f ] a new 1.5M IDTC [Indefinite Delivery Type Contract]. I guess S ing h is coming in to argue again for the Watervliet contract. He didn't c o n v in c e me, and now its OBE. Pl.'s App. at 189. Manifesting no knowledge that plaintiff would be terminated, Mr. Singh w ro te a November 17, 1994 letter to COL Inouye to discuss the transfer of Contract 0004. Id . at 190. Mr. Singh also wrote a November 28, 1994 letter to Contracting Officer R o b e rts o n expressing concern with the lack of understanding within plaintiff's organization a n d the potential for "a life time loss" for plaintiff. Id. at 191. Plaintiff insists that during th is period "IMS could not get a single task order." Singh Aff. ¶ 32. On November 22, 1994, Mr. Singh and LTC Graves met to discuss Contract 0004. A c c o rd in g to Mr. Singh, LTC Graves indicated that the decision to terminate the contract a lre a d y had been made and that the issue was whether plaintiff preferred a termination for c o n v e n ie n c e or award of work in exchange for losses suffered. Singh Aff. ¶ 36. Plaintiff " c o u ld see the writing on the wall," and asked for more work citing $8 - $10 million as the am o u n t needed to cover plaintiff's losses. Id. Defendant strongly disagrees with plaintiff's a c co u n t of the meeting and refers to a November 22, 1994 internal e-mail to members of the c o n tra c tin g office in which LTC Graves set forth his comments about the meeting. M r. Singh paid a visit today. We mentioned our options on the Watervliet c o n tra c t: a . T for C [termination for convenience] b . Partial deletion c . Out-of-scope mod (this is a negotiated 8a contract) to perform other w o rk somewhere else. 9

M r. Singh said that he would most prefer option "c." Let's try to find some o th e r work we can "substitute" in his contract. (This is in addition to the IDTC w e are offering.) P l.'s App. at 193. A November 22, 1994 e-mail from Ms. Correale to Ms. Robertson stated: D ick [Charles R. Strong, of the Baltimore District] will call the PM in H u n ts v ille to get the funds on the existing IMS contract transferred to us. Dick is also going to look over our program to find out if there are any projects in addition to the ones we already planned for the IMS IDTC to use for an out o f scope mod on their existing contract. P l.'s App. at 194. A November 23, 1994 e-mail from Ms. Robertson indicated that money re la tin g to Contract 0004 was being transferred from Huntsville to Baltimore, that at that p o in t a "bona fide need for the work" still existed, but "with a different contractor," and that te rm in a tio n of plaintiff would cause the Corps to lose money. Id. at 196. An undated note, s u rm ise d by plaintiff to have been created on or about November 28, 1994, see Pl.'s Prop. F in d in g s of Uncontr. Fact No. 73, from LTC Graves states, "Per our discussion, let's redo to capture our whole plan," Pl.'s App. at 197. A December 3, 1994 note from Ms. Robertson to LTC Graves states, We have a good course of action mapped out. Just need to carry it out . . . I h a d an interesting conversation w[ith] Jim Branch at SBA. Seems they are fed u p w[ith] this firm. I also have the letter to respond to that Singh wrote to Col I n o u ye . Will prepare one response to both letters. P l.'s App. at 199. Mr. Singh wrote a letter dated December 8, 1994, to LTC Graves, recounting d is c u ss io n points from various meetings and outlining what Mr. Singh viewed as the risks p la in tif f faced due to being unable to complete Contract 0004. He stated the following: " Y o u assured me that the Baltimore District is fair and equitable and IMS will be treated f a irly." Pl.'s App. at 203. On December 13, 1994, LTC Graves handwrote a memorandum s ta tin g : M r. Singh doesn't seem to want to hear our answer. As I understand it, o u r course of action is 1 . To seek entering into an IDIQ with IMS.

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2 . To use the remaining "capacity" in the Watervliet contract to do w o rk elsewhere in New York (as opposed to T for C). Pl.'s App. at 204. A subsequent letter dated "12/16" to COL Inouye from LTC Graves s ta te d : T h is guy comes in and I tell him what we're doing and he says "OK" a n d then he goes home and writes another unhappy letter. SBA is quite tired o f him. CT is preparing a letter re-iterating our position: 1 . Modify the Watervliet contract to give him new work somewhere e ls e (as opposed to T for C, which he doesn't want). 2. Give him an 8a IDTC. We are being more than fair. P l.'s App. at 205. On January 10, 1995, the Corps March 1, 1995 fact sheet indicated that th e Baltimore District received a proposal from plaintiff for a new contract and that the a w a rd was in the review process. Id. at 157. A February 13, 1995 e-mail from Ms. Correale to Mr. Strong ordered preparation of a new Fact Sheet because plaintiff had contacted "BG Stevens" complaining of plaintiff's tre a tm e n t by the Corps. Id. at 208. Along with a handwritten note "see me," signed "Dick," o n this e-mail, were notes of a draft fact sheet: 1 . Huntsville Contract for work at Watervliet contract Amount-Amount Obligated. 2. Work transferred to NAB July/Aug 94. 3 . Decision made to use MP in lieu of IMS for following reasons 1 . [blank] 2 . [blank] 4 . IMS advised that MP would entertain using IMS as Sub for the work. 5 . IMS arrogant in that they wanted all the work. MP backed off. 6 . IMS met with COL Graves Oct/Nov 94 . . . M.P. told IMS that District would offer them a 750K IDTC for work in our Division. Id . As recounted previously, Contract 0057 was awarded to plaintiff on June 30, 1995. C o n tra c t 0057, also an IDIQ contract, guaranteed a minimum of $15,000.00 and a maximum o f $1.5 million. Plaintiff interpreted this contract as the "`new'" IDIQ contract that the Corps h a d "promised" to compensate plaintiff for lost profits from Contract 0004. Singh Aff. ¶ 41. 11

D e f en d a n t does not dispute plaintiff's subjective interpretation, but denies any legal o b lig a tio n to award any contact for lost work from Contract 0004. Clause G-1 of Contract 0057 incorporates 48 C.F.R (FAR) 16.504; FAR 1 6 .5 0 4 (a )(4 )(iv ), as of October 1, 2995, requires that an IDIQ contract: [ s]ta te the procedures that will be used in issuing orders and, if multiple a w a rd s may be made, state the procedures and selection criteria that will be u s e d to provide awardees a fair opportunity to be considered for each order (see 16.505(b)(1). T h e parties disagree as to the applicability of FAR 16.505(b)(1) to this contract. D e f e n d a n t contends that regulation is inapplicable to single- award IDIQ contacts. FAR 1 6 .5 0 5 ( b ) (1 ) (1995) provides: [ E ]x c e p t as provided for in paragraph b(2) of this section, for orders issued u n d e r multiple delivery order contracts or multiple task order contracts, each a w a rd e e shall be provided a fair opportunity to be considered for each order in excess of $2,500. In determining the procedures for providing awardees a f a ir opportunity to be considered for each order, contracting officers shall e x e rc is e broad discretion and may consider factors such as past performance, q u a lity of deliverables, cost control, price, cost, or other factors that the co n trac tin g officer, in the exercise of sound business judgment, believes are r e le v a n t to the placement of orders. A Corps document on Contract 0004 titled "Summary," dated March 1, 1996, contains a bullet list of information regarding plaintiff's performance on Contract 0004: · Insufficient documentation to support Termination for Default · Termination for Convenience of the Government is the only viable option · IMS, P.C. must be compensated · IMS, P.C. could claim the remainder on the contract ($1M) plus damages · Recommend that the District resolve the termination as expeditiously as p o ss ib le · Recommend that the District extend all possible help to Mr. Singh · Monthly progress reports · Regular meeting with DE · Contract funds expire on 30 Sep 97 Pl.'s App. at 152. 12

O n March 3, 1996, Contracting Officer Ryals issued a formal stop-work order to p lain tiff regarding Contract 0004. On March 25, 1996, Contracting Officer Ryals sent a f o rm a l termination letter to the SBA regarding Contract 0004. Plaintiff wrote several letters to the Corps to express its disappointment with p la in tif f 's relative lack of success in securing contracts. One April 1, 1996 letter to COL D a n ie l F. Uyesugi stated: "We do however, observe that some of the more fortunate firms h a v e been able to participate to their full capacity and much more." Pl.'s App. at 232-34. P la in tif f was issued a delivery order for $74,159.70 under Contract 0057 on April 18, 1 9 9 6 . A July 30, 1996 letter from James O. Branch, the SBA Contracting Officer, asked the C o rps to certify "the exceptional contract performance demonstrated by IMS Engineers d u rin g the time that the firm was enrolled in the SBA 8(a) program." Pl.'s App. at 218. Plaintiff negotiated a termination for convenience of Contract 0004 on October 3 and 8 , 1996. The minutes of those meetings reflect that "Col. Graves had stated to Mr. Singh, ju s t what is it that you would like the work or the money. Mr. Singh again stated that he has b e e n waiting for 2 ½ years to do the work. Now it has been a total of 3 years." Pl.'s App. a t 222. Mr. Singh agreed to a termination settlement on October 8, 1996. Plaintiff asserts, a n d defendant strongly disagrees with plaintiff's interpretation of the October 8, 1996 Corps m e m o r a n d u m quoted by plaintiff, Pl.'s App. at 226-27, that the agreement was "prompted an d induced by the Government's implication that IMS would be fairly considered for more w o rk in the future," Pl.'s Prop. Findings of Uncontr. Fact No. 106. Plaintiff signed a termination modification on November 14, 1996, under what p la in tif f claims was "intense pressure." Pl.'s Prop. Findings of Uncontr. Fact No. 107 (citing S in g h Aff. ¶¶ 53-55). Plaintiff insists that the termination was "procured by fraud and d u r e s s , and must be considered void." Pl.'s Prop. Findings of Uncontr. Fact No. 107. P la in tif f further contends that, as of November 14, 1996, it had no idea how MP had obtained C o n tra c t 0004 and never would have agreed to the termination had plaintiff known then what it now knows. Id. No. 108 (citing Singh Aff. ¶ 55). Contract 0046 expired on September 30, 1997. Contract 0057 expired on June 30, 1 9 9 7 . Plaintiff claims to have been awarded only $130,676.00 under Contract 0057 and that o rd e rs under Contract 0046 purposely were withheld from plaintiff. Defendant asserts that $ 1 6 6 ,7 1 0 .0 0 was awarded under Contract 0057, which exceeded the minimum, so that the C o rp s was not obligated to issue any additional task orders to plaintiff. Defendant maintains that the majority of plaintiff's proposed facts are immaterial b e c a u se the Corps paid $499,999.00 in termination costs, bringing the total amount paid to 13

p la in tif f under Contract 0004 to $855,949.90. Defendant also relies on a release signed by M r. Singh on December 23, 1996, that recited, in pertinent part: The work under Contract Number DACA87-92-C0004, dated D e c em b e r 24, 1991 between the United States of America, represented by W illia m C. Ryals Contracting Officer, and the undersigned contractor, having b e e n completed and finally accepted, the United States, its officers and agents, a re hereby released from all claims and demands whatsoever arising under or b y virtue of said contract, except as follows: (If none, so state.) None D e f .'s Br. filed May 1, 2009, App. at 3. Defendant contends that this signed release waived a n y claim relating to Contract 0004. Plaintiff attributes the cessation of task orders under Contract 0046 to the problems expe rie n c e d with Contract 0004. Upon information and belief, plaintiff characterizes the halt in work orders as a "deliberate reprisal" and "not a coincidence." Pl.'s Prop. Findings of U n c o n tr. Fact No. 54. Plaintiff filed its complaint on May 9, 2007. On March 3, 2009, defendant moved for p artial summary judgment, to which plaintiff replied and cross-moved for summary ju d g m e n t on April 3, 2009. Briefing was completed on May 21, 2009. D IS C U S S IO N I. Cross-motions for partial summary judgment and summary judgment 1 . Standard of review R C F C 56(c) allows the court to grant a motion for summary judgment "if the p lead ing s, the discovery and disclosure materials on file, and any affidavits show that there i s no genuine issue as to any material fact and that the movant is entitled to judgment as a m a tte r of law." The benefit of all presumptions and factual inferences runs in favor of the n o n -m o v in g party when a court reviews a motion for summary judgment, Matsushita Elec. In d u s . Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986), and the party moving for s u m m a ry judgment bears the initial burden of demonstrating the absence of genuine issues o f material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). To combat a movant's p ro p o s e d absence of material fact, a respondent must establish that there is a genuine issue o f material fact, beyond some "metaphysical doubt," that is a "genuine issue for trial." M a ts u s h ita , 475 U.S. at 586-87 (internal quotations omitted).

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W h e n cross-motions for summary judgment are presented, the court evaluates each m o t io n on its own merits and resolves all doubts and inferences against the party whose m o tio n is being considered. Mingus Const. Inc. v. United States, 812 F.2d 1387, 1390-91 (F e d . Cir. 1987). The court will deny both motions if, upon the required analysis, a genuine is s u e of material fact exists. Id. 2. Good faith and fair dealing under Contract 0004 P la in tif f moved for summary judgment on Count 1 asserting that the Corps breached th e duty of good faith and fair dealing when plaintiff was wrongfully deprived of work under C o n tra c t 0004. The breach activity was the Corps's diversion of work under Contract 0004 to MP through various task orders, thus abrogating the Corps's duty to cooperate and h in d e rin g and delaying plaintiff's ability to complete performance. To camouflage the C o rp s's improper diversion of work, plaintiff argues, the Corps improperly and belatedly te rm in a te d plaintiff for convenience. Plaintiff further alleges that the Corps "directly li[ed] to and deceiv[ed]" plaintiff" and demonstrated prejudice against plaintiff because it e m p lo ye d foreign workers. Pl.'s Br. filed Apr. 3, 2009, at 19. P la in tif f proffers e-mail correspondence, several memoranda, and an affidavit from M r. Singh as support. Documents and correspondence quoted by plaintiff excite a high level o f suspicion regarding the Corps's actions in the administration of Contract 0004. An u n d a te d Corps document entitled "Questions which may be asked," states that the Corps has " n o documentation" to support plaintiff's termination and that "the Corps handling of this c o n tra c t was very poor. Making a public case of it would be very embarrassing." Pl.'s App. a t 146. In addition, Mr. Singh expresses his "surprise" that the Corps would not allow p la in tif f to complete Contract 0004 and further describes his frustration with what he p e r c e iv e d as the Corps's promise of extra work to make up for lost profits under Contract 0 0 0 4 , but never offering the volume or workflow that Mr. Singh expected. Singh Aff. ¶¶ 15, 3 7 . Mr. Singh documents instances where Corps employees led him to believe that work and m o n e y were coming through work orders, specifically through Contracts 0046 and 0057, but n e v e r materialized. Id. ¶¶ 37-38, 52-53. Defendant does not dispute any of the documented facts alleged by plaintiff, but c o n te n d s that plaintiff waived all actions under Contract 0004 upon signing a release on D e c em b e r 23, 1996. 2/ Defendant adds that the Corps remitted a payment of $499,999.00

2/ The release recites: T h e work under [Contract 0004], dated December 24, 1991 between the U n ite d States of America, represented by William C. Ryals Contracting O f f ic e r, and the undersigned contractor, having been completed and finally 15

to plaintiff for termination costs at the time the release was signed. The signed full release e f f e c tiv e ly released all claims relating to Contract 0004, thereby defeating plaintiff's motion f o r summary judgment. Plaintiff intones that the release is null and void because it was signed under "duress a n d falsehoods." Pl.'s Br. filed May 21, 2009, at 10-11. Plaintiff elaborates that it was under ec o n o m ic duress to the extent that plaintiff "had no choice but to accept the Government's te rm s ." Id. at 12. Plaintiff also represents that Mr. Singh agreed to sign the release under th e belief that the Corps would consider increasing the amount of Contract 0057 and that p lain tiff would be fairly considered for other future work orders. Based on the Government's d e a rth of evidence, Mr. Singh's affidavit, and plaintiff's documentary evidence, plaintiff asks f o r a grant of summary judgment in its favor. Plaintiff bears the initial burden of demonstrating the absence of genuine issues of m a te ria l fact under the circumstances surrounding Contract 0004's reassignment and te rm in a tio n . Celotex, 477 U.S. at 323. To prove that the Corps breached Contract 0004, p la in tif f must show by a preponderance of the evidence the manner in which the breach o c c u rre d . In addition, plaintiff has the "very weighty" burden to overcome the presumption th a t public officials act "conscientiously in the discharge of their duties," a burden "rarely s u c c e e d e d in demonstrating," to prove that the Government acted in bad faith. Krygoski C o n s tr. Co., v. United States, 94 F.3d 1537, 1541 (Fed. Cir. 1996) (quotations and citations o m itte d ). Plaintiff has put forth more than minimal evidence suggesting that the Corps diverted w o rk , acted suspiciously, and made a plurality of questionable decisions and representations th a t may overcome the release that plaintiff signed. However, with Mr. Singh's affidavit, p la in tif f has drawn the contours of a possible basis for recovery, but has not met the burden o f demonstrating the Corps's liability and the amount of damages as a matter of fact and law, a n d therefore cannot prevail on summary judgment for Count 1 seeking recovery under C o n tra c t 0004.

2/ (Cont'd from page 15.) a c c e p ted , the United States, its officer and agents, are hereby released from all c laim s and demands whatsoever arising under or by virtue of said contract, e x c ep t as follows: (If none, so state.) None D e f .'s Br. filed May 1, 2009, App. at 3. 16

3 . Good faith and fair dealing under Contracts 0046 and 0057 T h e parties filed cross-motions for summary judgment on Counts 2 and 3 of the c o m p lain t. These counts relate to Contract 0046 and Contract 0057, two IDIQ contracts b e tw e e n plaintiff and the Corps. It is undisputed that Contract 0046 was an IDIQ contract with a minimum of $ 1 0 0 ,0 0 0 .0 0 and that Contract 0057 was an IDIQ contract with a minimum of $15,000.00. It is also undisputed that the Corps placed orders above the minimum requirements under b o th Contract 0046 and 0057. 3/ Because the Corps met minimum requirements under C o n t ra c t 0046 and Contract 0057, defendant insists that plaintiff was not entitled to any f u rth e r business and that the very nature of an IDIQ contract preempts any remedy at law for " lo s [ in g ] [plaintiff's] gamble" that the contracts would yield far more than the stated contract m in im u m . Def.'s Br. filed Mar. 3, 2009, at 6. In citing Varilease Tech. Group Inc., v. United States, 289 F.3d 795 (Fed. Cir. 2002); T ra v e l Centre v. Barram, 236 F.3d 1316 (Fed. Cir. 2001); and Dot Sys. v. United States, 231 C t. Cl. 765 (1982), defendant argues that the Corps had no legal responsibility to provide w o rk beyond the stated minimums under Contracts 0046 and 0057 and, more definitively, th a t plaintiff has no legal basis to pursue damages for expected additional work after the s ta te d minimums were exceeded. Plaintiff submits that these cases do not control when the Corps failed to give fair c o n sid e ra tio n to plaintiff in placing orders under Contracts 0046 and 0057 and thereby acted in bad faith and breached its duty of good faith and fair dealing. Plaintiff's primary contention is that the Corps promised to award work under C o n tra c ts 0046 and 0057 to compensate for the Corps's alleged breach of Contract 0004, but u ltim ately failed to fulfill that promise. According to plaintiff, the key representations were m a d e to plaintiff during the parties' oral negotiations in 1996 to settle plaintiff's claims re la te d to termination of Contract 0004. Suggestive record evidence appears in a Price N e g o tia tio n Memorandum dated October 8, 1995, after price negotiations had taken place b e t w e e n plaintiff and the Corps:

3/ Defendant states that orders valued at $166,710.00 were placed under Contract 0 0 5 7 , while plaintiff pus the total at $130,676.00. This difference is immaterial for the p u rp o s e s of disposition, as both are above the $15,000.00 minimum amount under Contract 0 0 5 7 . Pl.'s Resp. to Def.'s Prop. Findings of Uncontr. Fact No. 3. 17

M r. Sing [sic] indicated that he would drop the interest costs if we w o u ld increase the value of the current IDTC from $750,000 to $5M. The c o n tra c tin g officer said that he would "consider" the issue but there would be n o guarantee. The IDTC has a maximum limit and the minimum guaranteed v a lu e of work would remain at $15,000 . . . Pl.'s App. at 226. Plaintiff argues that the Corps violated FAR § 49.102(a), a provision laying out the p ro c e d u re for a termination for convenience or default. This approach is misguided as a p p lied to Contracts 0046 and 0057, as they were not terminated for convenience or default. P la in tif f attempts to use the Corps's behavior regarding Contract 0004 to overcome d e f e n d a n t's arguments that focus squarely on the nature of IDIQ contracts, and thereby to re n d e r relevant the particular relationship and prior dealings between the parties in this case. T h e Federal Circuit has held that an IDIQ contract only promises a minimum purchase o b lig a tio n . See Varilease, 795 F.3d at 799 (explaining that "An ID/IQ contract differs from a requirements contract in that the former does not oblige the buyer to purchase more from t h e seller than a stated minimum quantity[.]"); see also Travel Centre, 236 F.3d at 1319 (sta tin g that IDIQ contract "provides that the government will purchase an indefinite quantity o f supplies or services from a contractor during a fixed period of time, it requires the g o v e rn m e n t to order only a stated minimum quantity of supplies or services." (emphasis a d d e d )). Even when the Government represents to a contractor that business in excess of the m in im u m should result from the IDIQ contract, once the minimum purchase obligation has b e e n met, additional assignments to the contractor are at the discretion of the Government. T r a v e l Centre, id. (finding no fault in Government's "less than ideal contracting tactics" w h e n solicitation for IDIQ contract with minimum purchase threshold of $100.00, had f ig u re s estimating $2.5 million per year profit from contract, and Government stopped using co n trac tor after $500,000.00 of gross sales). T h e Corps exceeded the minimum obligation under both Contract 0046 and Contract 0 0 5 7 . Despite any oral representations to the contrary, the parties are bound by the p ro v is io n s of their IDIQ contracts. As in Travel Centre, the Corps's actions can be c h a ra c te riz e d , at least at this stage of review, as "less than ideal contracting tactics," but do n o t alter the form and function of the IDIQ contracts. Id. at 1319. Defendant's motion for partial summary judgment is granted with respect to Counts 2 and 3. However, the facts pertaining to the Corps's conduct in the context of Contracts 0 0 4 6 and 0057 is not erased from the larger picture of this action. This award of partial s u m m a ry judgment is not a final judgment in this case. See RCFC 52(b). Plaintiff and 18

d e f e n d a n t should be aware that the facts surrounding Contracts 0046 and 0057, as they relate to Contract 0004, may be relevant to Count 1 insofar as plaintiff has alleged a pretextural te rm in a tio n . C O N C L U SIO N A c c o rd in g ly, based on the foregoing, I T IS ORDERED, as follows: 1 . Defendant's motion for partial summary judgment is granted insofar as defendant h a s established its entitlement to judgment in its favor on Counts 2 and 3 of the complaint. 2. Plaintiff's cross-motion for summary judgment is denied. 3 . The parties shall file a Joint Status Report by July 27, 2009, proposing a schedule f o r all pretrial filings and a date for the pretrial conference. Trial on Count 1, not to exceed f iv e days, shall commence at 10:00 a.m. on Monday, December 14, 2009, in the Court of In te rn a tio n a l Trade, One Federal Plaza, New York, NY. 4 . Any additional dispositive motion shall be filed before October 20, 2009, and b r ie f in g will be expedited to conclude within thirty days.

s / Christine O.C. Miller ______________________________ C h r is tin e Odell Cook Miller Judge

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