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Published on March 27, 2020 • Law

Froyo Company’s Attempt to Argue that Release Was Ambiguous Goes Down Like Cloying Combination of Peanut Butter and Bubblegum Flavors; Team Hall Venture, LLC, DBA Limeberry Frozen Yogurt v. United States, Fed. Cir. No. 2018-2283

ASBCA decision denying claim is affirmed. The ASBCA found that the contractor’s claim was barred by a release executed with the agency. On appeal, the contractor argued the release was ambiguous and should be construed against the agency. The Federal Circuit, however, found that the release was not ambiguous. The plain language of the release barred the claim.

The Army had a concessions contract with Limeberry Frozen Yogurt. The parties agreed to terminate the ten year contract early. They executed a contract modification to effectuate the termination. The modification had a release provision which provided that Limeberry released the Army “from any and all obligations related to the contract . . . including any that may arise in the future, to include the time period of 1-17 July 2016.”

Following the termination, Limeberry filed a claim disputing the payment it received as part of the termination. The agency denied the claim. Limeberry appealed to the ASBCA. The board denied the appeal, finding the claim was barred by the release language in the contract modification.

Limeberry then appealed to the Federal Circuit. Limeberry contended that the release was ambiguous because it was not clear the release barred all claims under the contract or only claims arising between July 1-17, 2016. Limeberry argued that this ambiguity should be resolved against the agency as the drafter of the contract.

The Federal Circuit rejected Limeberry's argument, finding there was no ambiguity in the release. By its plain language, the release released the agency from all claims. The additional specification that any claims arising between July 1-17 were also being waived did not create an ambiguity. Specifying that a future period was included does not mean that other periods were excluded.

Limeberry is represented by James Creedon. The government is represented by Joseph Alan Pixley, Joseph H. Hunt, Robert Edward Kirschman, Jr., and Douglas K. Mickle of the U.S. Department of Justice as well as Dana J. Chase and Bruce H. Robinson of Army Legal Services.

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