Earlier this week, the Federal Circuit unanimously affirmed a 2017 ruling by the Armed Services Board of Contract Appeals (“ASBCA”) that held the United States Government breached its contractual obligation to provide physical security to KBR and its subcontractors during the height of the Iraq War. The decision awards KBR $44 million, plus interest, in private security costs that the Government unilaterally recovered under the LOGCAP III contract.
The Court’s decision is significant in two respects. First, it confirms that the affirmative defense of prior material breach is not a Contract Disputes Act (CDA) “claim” that must be presented to a contracting officer under M. Maropakis Carpentry, Inc. v. United States, 609 F.3d 1323, 1331 (Fed. Cir. 2010). Second, the decision makes clear that a contractor is entitled to CDA interest on its claim to recover amounts taken or held by the Government to enforce a government claim. We discuss each of these important rulings below.
Continue Reading Federal Circuit Further Clarifies Maropakis and CDA Interest Rule in Significant “Contractor-on-the-Battlefield” Decision