CBCA 5739-C(5517)

` DENIED: November 28, 2017 CBCA 5739-C(5517) DREAM MANAGEMENT, INC., Applicant, v. DEPARTMENT OF HOMELAND SECURITY, Respondent. Timothy Sullivan and Jayna Marie Rust of Thompson Coburn LLP, Washington, DC, counsel for Applicant. Kasey Podzius and Gabriel E. Kennon, Office of the Principal Legal Advisor, Immigration and Customs Enforcement, Department of Homeland Security, Washington, DC, counsel for Respondent. Before Board Judges BEARDSLEY, GOODMAN, and RUSSELL. BEARDSLEY, Board Judge. On October 17, 2016, Dream Management, Inc. (DMI) appealed the denial of its claim for costs in performing a language interpretation services contract for the Department of Homeland Security, Immigration and Customs Enforcement (ICE). The Board granted the appeal, in part, in the amount of $17,079. Dream Management, Inc. v. Department of Homeland Security, CBCA 5517, 17-1 BCA¶ 36,716. In connection with the appeal, DMI filed an application seeking an award of fees and other expenses in the amount of $29,315.09, under the Equal Access to Justice Act (EAJA), 5 U.S.C. § 504 (2012). DMI CBCA 5739-C(5517) 2 stated that the application amount covers fees for three attorneys and one paralegal totaling $24,900, as well as $4415.09 in costs related to printing, meals, transcription services, and courier services. DMI incurred the fees and costs claimed on or after October 5, 2016, the date of the contracting officer’s final decision. ICE opposes DMI’s application, arguing that the agency’s position was substantially justified because the agency prevailed on most of DMI’s claim and DMI prolonged the resolution of the dispute by rejecting the agency’s settlement offer, an offer that was higher than the Board’s award. The agency points to the fact that DMI’s primary argument before the appeal was filed was that the agency breached the contract when it failed to order a guaranteed minimum from an indefinite delivery, indefinite quantity (IDIQ) task order. In its claim, DMI only mentioned in passing that the agency’s actions could also be considered a constructive termination for the convenience of the Government. ICE also argues that DMI’s recovery only equaled 15% of the highest amount claimed. DMI ultimately sought damages for breach of contract in the amount of $114,169.56, or termination for convenience damages in the amount of $62,001.04. The Board, however, rejected the theory that the contract was an IDIQ task order with a guaranteed minimum that the agency breached, finding instead that the contract was a time and materials task order with no guaranteed minimum that had been terminated for the convenience of the Government. Prior to the issuance of the contracting officer’s final decision, the parties engaged in settlement discussions. ICE offered to “offset a portion of the costs [DMI] incurred preparing for service” in the amount of $31,189.51. DMI made a counteroffer to the agency in the amount of $54,000. Without further settlement discussion, the contracting officer issued his final decision denying DMI’s claim on the basis that the contract was a time and materials contract, and DMI did not provide any services to the government. ICE did offer, however, to pay DMI $100, the guaranteed minimum in the federal supply schedule (FSS) contract pursuant to which the task order was issued. DMI argues that (1) the agency’s position was not substantially justified because it only awarded $100 in its final decision; (2) ICE asserted that the modification canceling DMI’s contract was not a termination for the convenience of the Government; and (3) ICE was, in essence, punishing DMI for not accepting the agency’s settlement agreement. Moreover, DMI argues that the fact that the agency misled DMI as to its actual needs for translation services rendered the agency’s position unjustified. While the Board found that the agency erroneously estimated the number of base hours expected, the Board also found that there was no negligent estimate or breach of CBCA 5739-C(5517) 3 contract of the time and materials task order. The Board also did not decide whether the $100 minimum in the FSS contract applied to the task order. Ultimately, the Board awarded a prorated amount of the costs incurred by DMI as a result of the agency’s termination of the contract for its convenience. The Board did not award DMI general and administrative (G&A) costs and profit.