Stop-Work Means Stop Work (…Until It Doesn’t): Lessons from Wolverine Tube

By Elizabeth Witwer, Daniel Russell Jr., Peter Terenzio & Homer La Rue on February 11, 2026

Posted in Bid Protests, Claims and Contract Disputes, Costs, FAR

A recent decision from the Armed Services Board of Contract Appeals (ASBCA) is a timely reminder that, when it comes to stop‑work orders, the clause the government actually invokes—not the one it later wishes it had—can be outcome‑determinative. In Wolverine Tube, Inc., ASBCA No. 63877 (Jan. 22, 2026), the Board rejected the Air Force’s attempt to retroactively recharacterize a stop‑work order and held that the order expired by its own terms after 90 days. Although the contractor did not obtain summary judgment on most of its claimed costs, the decision breaks new ground on how protest-related stop-work orders operate, what happens when they lapse, and how far the government can go in arguing that “stop work” really meant “stop incurring costs forever.”

Background

The dispute arose from an Air Force IDIQ contract for the manufacture and delivery of air cargo pallets. The contractor (“Wolverine”) was required to deliver six first articles for testing within 365 days of award, with anticipated downstream production tied to option periods. Like many supply contracts, the contract also included a familiar warning: production materials purchased before first‑article approval would be at the contractor’s risk.

Shortly after award, the incumbent contractor protested at GAO. In response, the contracting officer issued a stop‑work order directing Wolverine to cease performance. Critically, the order expressly cited FAR 52.242‑15, Stop‑Work Order, rather than FAR 52.233‑3, Protest After Award. The first of these clauses incorporates a 90-day time limit; the second does not. The Air Force later announced corrective action, and GAO dismissed the protest. But after that dismissal, the Air Force did…nothing. It did not cancel the order, extend the stop-work order, or terminate the contract. In short, it failed to take action within the 90-day period specified in FAR 52.242-15.

Once the 90 days elapsed, Wolverine resumed performance. It incurred operating costs, purchased tooling, and placed a substantial order for production materials in anticipation of first‑article testing and expected pallet orders. More than a year later, after the Air Force completed its corrective action and made award to another contractor, the Air Force terminated Wolverine’s contract for convenience.

When Wolverine submitted its termination settlement proposal, the Air Force paid only a small fraction of the claimed costs, asserting that the stop‑work order remained in effect through termination and that Wolverine should not have resumed performance or incurred costs after the stop-work was issued.

The Board’s Decision

The Board rejected the Air Force’s core legal theory and denied the government’s cross‑motion for summary judgment.

The clause said what it said. The Board emphasized that the stop‑work order on its face cited FAR 52.242‑15. That clause authorizes a stop‑work order for 90 days, absent an agreed extension, and requires the contracting officer (within that period) to either cancel the order or terminate the work. If the contracting officer does neither occurs, the order expires and the contractor must resume performance.

The Air Force argued that the contracting officer’s order should have been treated as if it had been issued under FAR 52.233‑3 because the stoppage arose from a bid protest, and that the citation to FAR 52.242‑15 was merely a mistake. Applying FAR 52.233-3 could have been decisive, since the stop-work period under that clause does not lapse automatically (unless the contract is terminated). The Board, however, was unpersuaded. It declined to “rewrite” the order after the fact, holding that the government was bound by the clause it actually invoked. Because the Air Force neither canceled the order nor terminated the contract within 90 days, the stop‑work order expired by operation of its own terms.

“Stop work” does not mean “incur zero costs forever.” The Board also rejected the Air Force’s fallback argument that all costs incurred during or after the stoppage were categorially unallowable. Both stop‑work clauses require contractors to take reasonable steps to minimize costs; not to incur no costs at all. And neither clause imposes an absolute bar on recovery in a subsequent termination for convenience. Instead, allowability turns on the termination clause and FAR Part 31, including the requirements of reasonableness and allocability.

Winning the clause battle didn’t win the war. While Wolverine prevailed on the legal effect of the stop‑work order, the Board declined to grant summary judgment on most of its claimed costs. Genuine disputes remained as to whether certain costs were reasonable and allocable, particularly given the ongoing corrective action and the lack of contemporaneous communication with the contracting officer. The Board did, however, grant summary judgment on two points: Wolverine’s entitlement to fair and reasonable profit on allowable costs and to reasonable settlement preparation costs.

First‑article risk still means risk. The Board devoted significant attention to the first‑article approval clause. That clause cautioned that production materials purchased before first‑article approval are generally at the contractor’s risk and not allocable in a termination settlement. Wolverine’s large purchase of production materials (far exceeding what was needed for first‑article testing) raised allocability questions that could not be resolved on summary judgment.

Practical Takeaways for Contractors

Although Wolverine Tube turns on its facts, it offers several practical lessons for contractors navigating stop‑work orders and protest‑related uncertainty:

1. Read the stop‑work clause carefully.

Do not assume the government invoked the “right” clause. Confirm which provision the contracting officer cited and what that clause actually requires. As Wolverine Tube illustrates, the Board will apply the stop‑work order as written, not as the agency later wishes it had been written.

2. Track stop‑work expiration dates.

For orders issued under FAR 52.242‑15, track the 90‑day deadline and any agreed extensions. If the government fails to act within that window, the order may lapse, and, under the terms of the clause, the contractor may be required to resume performance.

3. Resume performance cautiously.

Even when a stop‑work order expires by operation of law, resuming performance and incurring substantial costs can be risky, particularly where corrective action is ongoing or termination appears likely. Before ramping up, a written check‑in with the contracting officer may help avoid second-guessing later.

4. Reasonableness still rules the day.

Post‑stop‑work costs will be scrutinized under FAR Part 31. Contractors should segregate unavoidable costs from discretionary ones and maintain contemporaneous documentation to show why continued performance was prudent under the circumstances.

Wolverine Tube is a reminder that “stop work” does not always mean “stop forever”—but it also reminds contractors that when the stop sign disappears, proceed with caution, documentation, and a healthy respect for first-article risk.