Patriot Group International, Inc. ( 2019 )

ARMED SERVICES BOARD OF CONTRACT APPEALS
Appeal of-- )
)
Patriot Group International, Inc. ) ASBCA No. 60950
)
Under Contract No. HHM402-14-D-0002 )
APPEARANCE FOR THE APPELLANT: Eden Brown Gaines, Esq.
Washington, DC
APPEARANCES FOR THE GOVERNMENT: Raymond M. Saunders, Esq.
Army Chief Trial Attorney
LTC Robert B. Nelson, JA
Trial Attorney
OPINION BY ADMINISTRATIVE JUDGED ' ALESSANDRIS
In November 2013 , appellant, Patriot Group International, Inc. (Patriot) entered
into a contract with the Defense Intelligence Agency (DIA or government). The
contract did not contain provisions making the contract subject to the Service Contract
Act (SCA) and did not contain a wage determination. In July 2014, the contract was
modified to incorporate a wage determination for the Cleared American Guard (CAG)
labor category, and to compensate Patriot, retroactively and prospectively for the
increased wage ra\e for the CAG labor category. In addition to the CAG labor
category, the contract also included Cleared American Escort (CAE) and Cleared
Surveillance Technician (CST) labor categories. Despite Patriot' s assertions that the
CAE and CST labor categories were also subject to the SCA, the July 2014
modification did not incorporate wage determinations for these labor categories.
Patriot filed a claim seeking reimbursement of the SCA wage differential for the CAE
and CST labor categories, and additional funds for the CAG labor category, and
subsequently appealed to the Board.
In April 2017, the government filed a motion to dismiss Counts II and III of
Patriot's complaint for lack of jurisdiction because the contract provides that the wage
determination requested by Patriot can only be issued by the Department of Labor
(DOL) (gov ' t first mot. at 1). In its reply brief, the government informed the Board
that it had belatedly forwarded Patriot's wage determination conformance request to
the Department of Labor. The parties subsequently cooperated in an effort to get a
determination from the DOL, and the government offered to bilaterally modify the
contract to incorporate any wage determination issued by DOL. Following multiple
submissions and revisions of the conformance request, the DOL issued its decision on
the conformance request. Patriot subsequently amended its certified claim to revise
the claim amount. On April 5, 2019, the contracting officer issued a final decision
awarding Patriot the requested amount, plus CDA interest. Four days later, the
government filed a motion to dismiss, asserting Patriot's appeal was mooted by the
final decision (gov't second mot. at 4-5). Patriot does not dispute that the final
decision awarded the claimed amounts, but contends that the appeal should be the
subject of a joint stipulation of dismissal so that it can seek attorney fees pursuant to
the Equal Access to Justice Act (EAJA), 5 U.S.C . § 504. For the reasons stated below,
we grant the government's second motion.
STATEMENT OF FACTS (SOF) FOR PURPOSES OF THIS MOTION
On August 14, 2013 , the Defense Intelligence Agency, Virginia Contracting
Activity, issued Indefinite Delivery Indefinite Quantity Request for Proposal (RFP)
No. HHM402-13-R-OO 18 for global construction security services (R4, tab 1 at 1, 3).
On November 29, 2013 , Patriot was awarded Contract No. HHM402-14-D-0002 (R4,
tab 6). Both the RFP and the contract contained Federal Acquisition Regulation
(FAR) 52.222-41 SERVICE CONTRACT ACT OF 1965 (Nov 2007) and FAR 52.222-53
EXEMPTION FROM APPLICATION OF THE SERVICE CONTACT ACT TO CONTRACTS FOR
CERTAfN SERVICES - REQUIREMENTS (FEB 2009) (R4, tab 1 at 49 ; tab 6 at 19-20).
On April 1, 2014, the government issued a task order to Patriot for services to
be performed in the Washington, DC area (R4, tab 10). On July 11 , 2014, the
government issued a modification to the contract to incorporate a wage determination
for the CAG labor category (R4, tab 14). On August 25 , 2014, the government
modified the task order to add $294,861.00 to the contract to compensate Patriot for
the higher wage rates for the CAG category under the wage determination (R4,
tab 20). Patriot asserts that its CAE and CST positions were also subject to the
SERVICE CONTRACT ACT (app. first opp ' n iJiJ at 12-14). On April 2, 2015 Patriot sent
a request for a conformance action to the contracting officer, and indicated that the
attached letter, dated April 1, 2015 , had been sent directly to the DOL (R4, tab 30
at 1). In the request, Patriot indicated that the CAE labor category should be subject to
the Guard I category in the wage determination and that the CST labor category should
be conformed I to the Engineering Technician III wage category (id. at 4-5) . Patriot
asserts that the contracting officer took no action in response to the request and did not
forward the request to the DOL (R4, tab 63 at 2).
1
The "conformance process is a method in which contractors may propose job titles
and wage rates to legally employ workers in occupations not listed in the wage
determination (WD) applicable to the contract. The proposed wage rates should
be reasonably relative to other occupational wage rates on the applicable WD. "
U.S. Department of Labor Wage and Hour Division "Mc-Namara - O' Hara
Service Contract Act [SCA] Conformance Guide" (app. first opp ' n, ex. 3 at 3).
2
On August 1, 2016, Patriot submitted a certified claim in the amount of
$225 ,493.61 (R4, tab 63). On August 24, 2016, Patriot submitted an amended
certified claim demanding $727,971.68 (R4, tab 65). By letter dated September 30,
2016, the government informed Patriot it would issue its final decision by
November 10, 2016 (R4, tab 66). Patriot then filed with the Board a request for an
order directing the contracting officer to issue a final decision not later than
October 28, 2016. By opinion dated October 25 , 2016, the Board directed the
contracting officer to issue a final decision by November 10, 2016. Patriot Group
International, Inc., ASBCA No. 60846-972, 2016 WL 6639611 (Oct. 25 , 2016) (R4,
tab 69).
On November 10, 2016, rather than issuing a final decision on Patriot' s claim,
the Contracting Officer sent Patriot a letter requesting additional information and
disputing Patriot's assertion that the CAE and CST labor categories fell under the
wage determination labor categories (R4, tab 70). The letter additionally stated that
FAR 52.222-41 (t) provides that disputes concerning labor standards are solely
resolved in accordance with the DOL procedures at 29 C.F .R. Parts 4, 6, and 8 (Id.
at 2).
In addition, on November 10, 2016, the parties executed bilateral
Modification P00006 to the contract with an effective date of July 11 , 2014 (R4,
tab 71 ). The modification incorporated FAR 52.222-41 , SERVICE CONTRACT LABOR
STANDARDS (MAY 2014), into the contract by reference. This clause provides in
relevant part:
(t) Disputes concerning labor standards. The U.S.
Department of Labor has set forth in 29 CFR Parts 4, 6,
and 8 procedures for resolving disputes concerning labor
standards requirements. Such disputes shall be resolved in
accordance with those procedures and not the Disputes
clause of this contract. Disputes within the meaning of this
clause include disputes between the Contractor ( or any of
its subcontractors) and the contracting agency, the U.S.
Department of Labor, or the employees or their
representatives. 2
(R4, tab 71 at 10)
2 The provision is unchanged from FAR 52.222-4l(t), SERVICE CONTRACT ACT OF
1965 (Nov 2007) that was already incorporated by reference into the contract
(R4, tab 6 at 19).
3
On December 19, 2016, Patriot filed its notice of appeal and complaint with the
Board, asserting a deemed denial of its claim. In its complaint, Patriot demanded
$953,465.29, and asserted entitlement to retrospective and prospective wage increases
for the CAG [Count I] , CAE [Count II] and CST [Count IIIJ 3 contract labor positions
(comp!. ,r,r 15-33).
On April 11 , 201 7, the government filed a motion to dismiss Counts II and III
of Patriot's appeal for lack of subject matter jurisdiction, and requested that the Board
stay proceedings pending resolution of the motion (gov't first mot. at 1, 6). The Board
granted the requested stay in an order dated April 12, 2017 (Bd. corr. !tr. dtd. Apr. 12,
2017) . In its reply brief, the government represented that it submitted a SF 1444 to the
DOL on June 13 , 2017, the day before filing the brief (gov't first reply at 7).
The parties subsequently cooperated in an effort to get a determination from the
DOL. In a joint status report dated November 21, 2017, the parties reported that "the
government has offered to enter into a bilateral modification of Contract
No. HHM402-14-D-002_0001 incorporating applicable Wage Determinations
('WDs') with the appellant" (Bd. corr. ltr. dtd. Nov. 21, 2017). Following multiple
submissions and revisions of the conformance request, the DOL issued its decision on
the conformance request for the CST labor category on December 7, 2018 and its
decision of the CAE labor category on December 13 , 2018 (Bd. corr. !tr. (app. status)
dtd. Jan. 9, 2019; Bd. corr. !tr. (gov't status) dtd. Jan. 9, 2019). Patriot amended its
certified claim on January 16, 2019, revising the claim amount to $962,0 15.92 (gov ' t
second mot., at exs. 1-2). On April 5, 2019, the contracting officer issued a final
decision awarding Patriot the requested amount, plus CDA interest (id. ex. 1). Four
days later, the government filed a motion to dismiss, asserting Patriot's appeal was
mooted by the final decision (id. at 1).
Decision
The government moves to dismiss Patriot's appeal as moot because the
contracting officer issued a final decision that awarded Patriot its requested relief
(gov't second mot. at 1). Patriot opposes the motion as an attempt to prevent it from
filing a motion for attorney fees pursuant to the Equal Access to Justice Act (app.
second opp'n at 1-2).
It is well established that the Board must dismiss as moot an appeal when the
appellant has received all the relief requested. See, e.g., Shiloh Services, Inc., ASBCA
No. 61134, 18-1 BCA ,r 37,117 at 180,662 (citing Chapman Law Firm Co. v.
Greenleaf Cons tr. Co. , 490 F.3d 934, 939 (Fed. Cir. 2007)). Here, Patriot does not
dispute that the government has paid it the amounts asserted in its revised claim,
3
Patriot's complaint actually refers to the counts as § III.A to § III .C.
4
including CDA interest (app. second opp'n at 3). Patriot has not identified any costs
for which it has not been compensated. Accordingly, we find that the contracting
officer's April 5, 2019 final decision has mooted Patriot's appeal.
Patriot contends that an order dismissing the action pursuant to a joint
stipulation of dismissal , rather than a dismissal for mootness, would allow it to file a
petition pursuant to the Equal Access to Justice Act, 5 U.S.C. § 504 (id. at 3-4).
Patriot additionally contends that the procedural posture in this matter, with Patriot
appealing from a final decision denying its claim,4 rather than the deemed denial and
subsequent final decision granting relief as in Shiloh means that Shiloh is not
controlling here. Patriot additionally contends that the government made
"misrepresentations" and used "subterfuge" in issuing a final decision "to deprive the
Board of subject matter jurisdiction." Finally, Patriot contends that an order by the
Board dismissing the appeal as moot because all relief was granted would "remain a
basis for an application pursuant to EAJA as Patriot Group would still be the
prevailing party within the meaning of the law." (Id. at 4)
EAJA provides that a business with a net worth less than $7,000,000 that
prevails before the Board "shall [be] award[ ed]" the fees and other expenses that it
incurred unless the position of the government was "substantially justified" or other
circumstances make such an award unjust. 5 U.S.C: § 504; see also Rex Systems, Inc.,
ASBCA No. 52247, 02-1 BCA ,i 31 ,760 at 156,854. Here, it makes no difference
for the determination of "prevailing party" status, whether the appeal is dismissed as
moot, or dismissed by joint stipulation of the parties. 5 In addition, we find that the
difference in procedural posture in this appeal compared to Shiloh is legally irrelevant.
Even assuming the truth of Patriot's assertions of "misrepresentations" and
"subterfuge," the difference between a dismissal based upon a motion to dismiss as
moot and dismissal based upon a joint stipulation of dismissal is irrelevant to any issue
currently before the Board. Moreover, we note that the parties jointly represented to
the Board back in November 2017 that "the government has offered to enter into a
4
We note that, contrary to its argument here, Patriot alieged in its complaint that it was
appealing from a deemed denial of its claim (com pl. ,i 1).
5
We note that Patriot cites the Board ' s decision in Lucia E. Naranjo , ASBCA
No. 52084, 00-2 BCA ,i 30,937, for the proposition that a party may be eligible
for EAJA fees if an appeal serves as the "catalyst" to a settlement (app. second
opp'n at 4). However, that opinion pre-dates the Supreme Court' s decision in
Buckhannon Board and Care Home, Inc. v. West Virginia Department of
Health and Human Resources, 532 U.S . 598 (2001). Following Buckhannon,
the Board has held that a joint stipulation of dismissal does not qualify as a
judgment on the merits or a consent decree, and does not establish an appellant
as a prevailing party. See, e.g. , Poly Design, Inc. , ASBCA Nos . 48591 et al. ,
01-2 BCA iJ 31 ,644 at 156,303.
5
bilateral modification" of the contact, a process that naturally would lead to payment
by the contracting officer through the contract (Bd. corr. !tr.