Contractor’s claims appeal is denied. The contractor sought damages for the agency’s failure to conduct a performance evaluation, but the contractor never submitted that claim to the contracting officer, so CBCA lacked jurisdiction over it. The contractor also requested costs for damaged supplies, but the contractor had released that claim as part of a contract modification. Finally, the contractor claimed it was owed costs due to wage increases. Unfortunately, the contractor’s only support for this claim was speculative data and unsubstantiated sworn statements.
Stobil Enterprise had a contract to provide dietary and housekeeping services at a VA facility. Stobil submitted a claim to VA for (1) costs incurred after the company paid back wages to employees to comply with the Service Contract Act and the Fair Labor Standards Act, (2) damaged supplies, including a soap dispenser, a work table, and food, (3) costs incurred due to VA’s failure to provide a performance evaluation. VA denied the claim. Stobil appealed to CBCA, and both parties moved for summary judgment.
The board quickly disposed of the claims concerning the lack of a performance evaluation and damaged supplies. The board lacked jurisdiction over the performance evaluation claim because Stobil never submitted that claim to the contracting officer. As to the damaged supplies, the board determined that Strobil had released this claim as part of a contract modification.
With respect to the claim for costs incurred due to increased wages, VA argued that Stobil had not provided enough evidence substantiate the claim. The board agreed. Stobil had been given multiple opportunities—through discovery, responses to motions, and explicit requests form the board—to produce evidence to support its wages claim. The evidence Stobil produced, however, did not pass muster.
For instance, Stobil prepared a chart purporting to show the wage rates and hours for it employees. But the chart did not detail the actual hours worked by Stobil employees; it simply presented the hours that the employees were projected to work in a year. Under the FAR, any adjustment in contract price due to increased wages or benefits must be based on the contractor’s actual, not projected increases.
Additionally, Stobil submitted a sworn statements from its contract manager who asserted that VA failed to pay applicable wage and benefit increases. But the contract manager did not provide any amount allegedly due based on the wages Stobil actually paid to its employees, nor did he reference any payroll or cost documentation that supported his contentions.
Stobil also submitted a statement from its owner who averred that the VA had erred in its calculation of back wages, and that Stobil was entitled to more wages than the agency had already paid. Again, this statement lacked support. A mere assertion that the government erred in its calculation, without more, was neither sufficient to support Stobil’s summay judgment motion, nor to oppose the VA’s cross-motion.
As part of its appeal, Stobil also requested $800,000 in damages for lost business opportunities and over $2.3 million in interest on its claims. The board rejected the request for lost business damages, reasoning that damages that are not an outgrowth of the contract itself are too speculative.
The board opined that the request for interest strained credulity. Stobil’s claim for wage costs was about $100,000 and its claim for damaged supplies was only about $2000. Given the amount in dispute, the board doubted that Stobil would be entitled to over $2 million in interest. Regardless, Stobil was not entitled to interest on its claims because the claims failed.
The board denied Stobil’s summary judgment but granted VA’s cross-motion.
Strobil is represented by Billie O. Stone, its CEO. The government is represented by Mary A. Mitchell of the Department of Veterans Affairs