Government’s motion for summary judgment on contractor’s claims is granted in part. The contractor alleged the government had improperly deducted amounts from the contractor’s invoices. The government argued that the deductions had been made more than six years ago, so the claims were barred by the CDA’s statue of limitations. The contractor alleged the claims had not accrued when the deductions were applied, but rather when the invoices were paid. The board rejected this argument. A claim accrues when an injury occurs, not when the extent of damages are known. Here, the contractor had been injured when the deductions were first applied. That was the date on which the contract had been allegedly breached and when the contractor had been injured.
BNN Logistics had one of several IDIQ contracts with the Army to provide trucking services in Afghanistan. The IDIQ contract provided that the Army would keep an Order of Merit list, which was used to rank contractors and assign trucing missions accordingly. The contract established criteria ranking the trucking contractors each week. The Army would then notify each contractor of its weekly ratings and the assign a corresponding percentage of missions.
The contract also permitted the Army to make deductions from contractors’ invoices. First, the contract set forth performance standards and allowed the Army to make deductions for failure to satisfy certain metrics. Second, for any mission transporting fuel, if the Army found that more than 5% of the fuel was missing, the Army would not pay the invoice for the delivered fuel and would require the contractor to reimburse it for the missing fuel.
BNN performed deliveries for the Army in 2012 and 2013. In 2018, BBN submitted a claim to the Army seeking over $400,000 in deductions take from invoices for not meeting performance standards. The Army denied the claim, and BNN appealed to the ASBCA.
In 2019, BNN submitted another claim seeking over $15 million, alleging it had not received proper allocations of missions under the Order of Merit List. The Army denied that claim. BNN appealed again to the ASBCA.
1n 2020, BNN submitted a third claim to the Army asserting that the agency had improperly imposed almost $3 million in financial penalties for fuel pilferage. The Army denied that claim, and BNN appealed to the ASCBCA. The various appeals were consolidated.
The Army moved for summary judgment, arguing that BNN’s claims were barred by the CDA’s six-year statute of limitations. BNN cross-moved for summary judgment, claiming that the Army had breached the contract by making improper deductions and not properly allocating missions.
As to the performance issues, BNN contended that that the Army had failed to follow the formula in the contract for deductions, made improper deductions, and manipulated data to increase deductions. The Army argued that BNN knew of should have known of these deductions in 2012 when the Army returned invoices to BNN containing these deductions. BNN had not filed a claim until more than six years after receiving the invoices. BNN attempted to argued that its claim had not accrued with the returned invoices, but only when it was not paid the full amount of the invoices.
The board found BNN’s argument misplaced. A claim for breach of contract accrues at the time of the injury, i.e., when there is a breach. Damages need not be calculated for a claim to accrue. Here, BNN’s injury were the reductions applied to its invoices. That claim accrued when it received the invoices back instituting the deduction. It did not accrue when the invoices were paid. The board found that several of the invoices were returned before the start of the six-year window. Claims arising from those invoices were barred by the statute of limitations. For several other invoices it was unclear to the board when the performance deductions had been assessed. The board denied the Army’ summary judgment motion as to those invoices with unclear dates.
The Army also alleged that the statute of limitations barred the claims for improper fuel pilferage deductions. BNN attempted to argue that more discovery was needed because there were issues of fact as to whether the Army had properly measured the missing fuel or failed to investigate which party was responsible for the missing fuel. The board, however, reasoned that none of these arguments addressed why BNN would not know whether a fuel pilferage deduction had been applied to it invoices. The board granted the Army’s summary judgment motion for fuel pilferage deductions that had been applied prior to December 2012. It denied summary judgment for deductions taken after that date due to lack of information.
Finally, as to the allocation of missions, the Army argued that BNN’s allocation claims arose when the company received the Order of Merit List each week in 2011 and 2012. BNN contended that it could not have known about the Army’s allocations until it received mission information data in 2017.
The board agreed with the BNN with respect to the allocations claims. BNN did not possess information to verify whether the percentage of missions it received was accurate until it received the mission data in 2017. BNN’s claim did not accrue until 2017 and thus that claim was still timely.
BNN is represented by Michael D. Maloney of Williams Mullen PC, Todd W. Miller of Miller & Miller, and Enayat Qasimi of Whiteford, Taylor & Preston L.L.P. The government is represented by Scott N. Flesch, Zachary F. Jacobson, Major Aaron McCartney, and Major James. A. Wallace.
