CBCA 5942

DISMISSED FOR LACK OF JURISDICTION: September 27, 2018 CBCA 5942, 5943, 5944, 5945, 5946 DEVELOPMENT ALTERNATIVES, INC. on behalf of ERSM (AFGHANISTAN) LIMITED, d/b/a EDINBURGH INTERNATIONAL, Appellant, v. AGENCY FOR INTERNATIONAL DEVELOPMENT, Respondent. Armani Vadiee, Todd M. Garland, and Sean K. Griffin of Smith Pachter McWhorter PLC, Tysons Corner, VA, counsel for Appellant. John Alumbaugh, Office of General Counsel, Agency for International Development, Washington, DC, counsel for Respondent. Before Board Judges SOMERS (Chair), HYATT, and ZISCHKAU. SOMERS, Board Judge. Background Respondent, Agency for International Development (USAID), awarded Development Alternatives, Inc. (DAI) five contracts to provide security services in Afghanistan. DAI executed subcontracts with ERSM (Afghanistan) Limited, d/b/a Edinburgh International (ESRM), a private security company (PCS). As DAI’s subcontractor, ESRM provided armed security services under cost reimbursement type contracts. CBCA 5942, 5943, 5944, 5945, 5946 2 The Government of the Islamic Republic of Afghanistan (GIRA) assessed fines on PCSs employing more than 500 guards. As a result, ERSM, with more than 500 guards, paid $1,973,229.24 in fines. ERSM submitted five claims for reimbursement of this payment to DAI, certified by its corporate secretary: I certify that the claim is made in good faith; that the supporting data are accurate and complete to the best of my knowledge and belief; that the amount requested accurately reflects the contract adjustment for which the subcontractor believes DAI and the Government to be liable; and that I am duly authorized to certify the claim on behalf of the subcontractor. On May 10, 2017, DAI submitted ERSM’s claims to the contracting officer. DAI’s cover letter, also dated May 10, 2017, stated: DAI Global, LLC hereby submits DAI sponsored claims submitted by ERSM Subcontractor (Afghanistan Limited d/b/a/ Edinburgh International) for the Contracting Officer’s consideration and decision under DAI’s five prime awards listed below. These sponsored claims are submitted in accordance with FAR [Federal Acquisition Regulation] 52.233-1 and the Contracts [sic] Disputes Act [(CDA), 41 U.S.C. §§ 7101-7109 (2012)]. As all the awards ended between 2011 and 2015, we are submitting this request to you as the cognizant Contracting Officer. . . . As DAI believes there is a sound basis for these claims, we are sponsoring these ERSM’s [sic] certified claims. ERSM, DAI’s Security Service Provider, was not able to receive an exemption to the five-hundred-person [c]ap imposed by the changes in the local laws of the [GIRA]. Therefore, ERSM incurred the resulting fines during their performance under the above-referenced awards. Given that ERSM is the real party in interest and is the only one who can logically and realistically certify these claims, DAI hereby submits this certification in satisfaction of the requirements of the Contract Disputes Act. As DAI is not the real party in interest, DAI must accept and rely on the ERSM certification at face value. In addition, DAI has no knowledge, which suggests that ERSM has knowingly or intentionally failed to comply with the requirements of the Contracts [sic] Disputes Act or has acted in bad faith. CBCA 5942, 5943, 5944, 5945, 5946 3 In a July 19, 2017, letter, the contracting officer informed DAI that it needed to properly certify the claims and that the Government would not respond to the claims “until DAI Global submits a certified claim in accordance with FAR 33.207(a) and [the] CDA.” On August 3, 2017, DAI submitted what it identified as a “supplement” to its May 10, 2017, certification: As DAI believes there are good grounds for these claims, we are sponsoring ERSM’s certified claims, and DAI hereby submits this certification in satisfaction of the requirements of the Contract Disputes Act. These claims are being filed by our subcontractor and, inasmuch as ERSM does not have privity with USAID, DAI is acting as a conduit on behalf of ERSM in this matter. DAI does not have access to ERSM’s books and records and, therefore, cannot make any statement with respect to the amount of the claim.