HIGHWAY AND SAFETY SERVICES, INC. v. USA

Filing 11

TRANSFER ORDER: Granting plaintiff's 9 motion to transfer; The remaining filing deadline included in the Court's February 13, 2024 Scheduling Order (ECF 8 ) is VACATED; This matter is TRANSFERRED to the Civilian B oard of Contract Appeals pursuant to 41 U.S.C. § 7107(d); and the Clerk of Court is directed to TRANSFER this case to the Civilian Board of Contract Appeals by mailing a certified copy of this order and a copy of the docket sheet in this matter to the Civilian Board of Contract Appeals. Signed by Judge Armando O. Bonilla. (ead) Service on parties made.

In the United States Court of Federal Claims
NOT FOR PUBLICATION
No. 23-1854C
(Filed: March 26, 2024)

HIGHWAY AND SAFETY
SERVICES, INC.,
Plaintiff,
v.
UNITED STATES,
Defendant.

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Daryle A. Jordan, Jordan Guydon LLP, Fairfax, VA, for plaintiff.
Daniel A. Hoffman, Trial Attorney, Commercial Litigation Branch, Civil Division,
U.S. Department of Justice, Washington DC, for defendant. With him on the briefs
were Brian M. Boynton, Principal Deputy Assistant Attorney General, and Patricia
M. McCarthy, Director, and Martin F. Hockey, Jr., Deputy Director, Commercial
Litigation Branch, Civil Division, U.S. Department of Justice, Washington DC.
TRANSFER ORDER
BONILLA, Judge.
On September 3, 2021, the Department of Transportation, Federal Highway
Administration (FHWA), awarded plaintiff Highway and Safety Services, Inc. (HSS)
a firm fixed-priced contract to rehabilitate the Tidal Basin Outlet Bridge and
resurface the adjoining East Basin Drive, abutting the National Mall in Washington,
DC. A notice to proceed for the National Mall and Memorial Parks project eventually
issued with a March 14, 2022 start date and a January 27, 2023 completion date.1

The delayed start of contract performance was attributed to a parking permitting issue and the
approaching winter months immediately followed by the National Cherry Blossom Festival, during
which construction is limited and prohibited, respectively. Notwithstanding the effective date
included in the notice to proceed, HSS maintains contract performance was further delayed until
April 20, 2023, due to restrictions surrounding the National Cherry Blossom Festival.
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Eight months later, on November 4, 2022, FHWA terminated the contract for default,
citing HSS’s failure to make sufficient progress.2
On February 6, 2023, HSS appealed the default termination to the Civilian
Board of Contract Appeals (CBCA or Board). With HSS’s concurrence, the CBCA
dismissed the appeal without prejudice for failure to timely file within the ninety-day
statutory window in accordance with 41 U.S.C. § 7104(a). See Highway & Safety
Servs., Inc. v. Dep’t of Transp., No. 7664 (CBCA filed Mar. 14, 2023) (ECF 9-1 at 22).
On October 20, 2023–as the one-year statute of limitations to seek review in this
Court neared expiration under 41 U.S.C. § 7104(b)(3)–HSS commenced this action
seeking to convert the termination for default into one for convenience and recover
consequential damages. HSS charges the contracting officer’s decision is arbitrary,
capricious, an abuse of discretion, and contrary to law.
In the interim, HSS submitted a certified claim on July 10, 2023, requesting a
contracting officer’s final decision on a demanded 105-day contract extension and an
equitable adjustment in the amount of $447,872. ECF 9-1 at 2–21. In support, HSS
charged that the government delayed contract performance and alleged defective
government specifications, work suspension, contract and construction changes,
differing site conditions, contract interference, and cardinal changes. The contracting
officer denied HSS’s claim on November 14, 2023. HSS timely appealed this decision
to the CBCA. See Highway & Safety Servs., Inc. v. Dep’t of Transp., No. 7962 (CBCA
filed Dec. 15, 2023) (ECF 9-1 at 23).
Pending before the Court is plaintiff’s motion to transfer this matter to the
CBCA pursuant to 41 U.S.C. § 7107(d).3 See ECF 9. Defendant objects to HSS’s
purported effort to circumvent the ninety-day statute of limitations which previously
prevented litigation of this matter before the Board. For the reasons set forth below,
the interests of justice and judicial economy weigh in favor of transfer and
recommended consolidation with CBCA No. 7962.
Title 41, United States Code, Section 7107(d) provides:
If 2 or more actions arising from one contract are filed in the
United States Court of Federal Claims and one or more agency boards,
for the convenience of parties or witnesses or in the interest of justice,
the United States Court of Federal Claims may order the consolidation
of the actions in that court or transfer any actions to or among the
agency boards involved.

FHWA issued a cure notice on September 22, 2022. Although the parties reportedly met five days
later to discuss the agency’s stated concerns, an October 13, 2022 show cause notice followed after HSS
purportedly did not respond to the cure notice in writing. HSS formally responded to the show cause
notice on October 20, 2022, and the parties reportedly met again the following week.
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3 HSS further requests a stay of proceedings pending the Court’s ruling on the motion to transfer. With the issuance
of this decision, the requested stay is moot.

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41 U.S.C. § 7107(d). Critical here, this Court recently concluded that a timely appeal
to this Court vests derivative jurisdiction in agency boards following a § 7107(d)
transfer even where the plaintiff failed to file in either forum within ninety days:
“Nothing in § 7107(d) limits this Court’s transfer authority to complaints filed within
90 days of the contracting officer’s decision.” See Meltech Corp. v. United States,
No. 21-1532, 2023 WL 1960803, at *2 (Fed. Cl. Feb. 13, 2023) (citing in Glenn v.
United States, 858 F.2d 1577, 1580–81 (Fed. Cir. 1988) (sanctioning transfer of
actions filed in the Court of Federal Claims between ninety-one days and one year of
the contracting officer’s decision under the predecessor statute to § 7107(d)))
(additional citations omitted).
In assessing whether a § 7107(d) transfer to an agency board would facilitate
the just and efficient resolution of an underlying dispute, the Court traditionally
considers the following factors:
(1) Whether the dispute before the board and the court concern the same
contract; (2) whether the claims before the court and the board duplicate
claims or have overlapping and related issues; (3) whether plaintiff
initially chose to appeal its claims before a court or a board; (4) whether
one forum or the other has already made significant progress on the
claims; (5) whether concurrent resolution would result in an inefficient
allocation of the court’s, board’s, or party’s resources; [and] (6) whether
separate forums would reach inconsistent results.
Avant Assessment, LLC v. United States, 134 Fed. Cl. 323, 332–33 (2017) (quoting
Morse Diesel Int’l, Inc. v. United States, 66 Fed. Cl. 801, 804 (2005) (citing Giuliani
Contracting Co. v. United States, 21 Cl. Ct. 81, 83 (1990))). With the exception of
factor three, defendant readily concedes each factor supports consolidation as the
pending claims before this Court and the CBCA involve the same contract and are
otherwise inextricably intertwined.4
Turning to factor three, the Court notes HSS initially appealed the termination
for default directly to the CBCA. In fact, HSS only filed in this Court after realizing
its appeal to the Board was four days late. In the intervening eight months, HSS
submitted a directly related certified claim and then timely appealed the contracting
officer’s denial of that claim to the CBCA. The facts presented demonstrate that
HSS’s initial and preferred forum is the Board rather than this Court.5
In arguing against transfer, defendant highlights the potential implications of
allowing HSS backdoor access to the CBCA despite the company’s untimely appeal of
its termination for default. However, this Court has “broad discretion” to make such
Regarding factor four (relative progress), the Court notes the parity between this Court and the
CBCA (i.e., both matters are in the initial pleading stages).
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The Court is not persuaded by defendant’s argument that HSS’s untimely appeal to the CBCA
undercuts plaintiff’s initial forum choice.
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a determination and is neither obligated nor obliged to grant an untimely litigant’s
motion. See CH2M Hill Hanford Grp., Inc. v. United States, 82 Fed. Cl. 139, 144
(2008) (“This Court ‘possesses broad discretion in exercising its power to consolidate’
or transfer a case to an agency board.”) (quoting Joseph Morton Co. v. United States,
757 F.2d 1273, 1280 (Fed. Cir. 1985)). At bottom, the facts presented and relevant
caselaw warrant transfer to the CBCA for possible consolidation with the directly
related matter pending before the Board.
For the foregoing reasons,
(1) Plaintiff’s motion to transfer (ECF 9) is GRANTED;
(2) The remaining filing deadline included in the Court’s February 13, 2024
Scheduling Order (ECF 8) is VACATED;
(3) This matter is TRANSFERRED to the Civilian Board of Contract Appeals
pursuant to 41 U.S.C. § 7107(d); and
(4) The Clerk of Court is directed to TRANSFER this case to the Civilian Board of
Contract Appeals by mailing a certified copy of this order and a copy of the docket
sheet in this matter to:
Judge Erica S. Beardsley, Chair
Civilian Board of Contract Appeals
1800 M Street, NW – 6th Floor
Washington, DC 20036
It is so ORDERED.
___________________
Armando O. Bonilla
Judge

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