226 F.3d 1329 (Fed. Cir. 2000), 99-1258, ACE-Fed Reporters, Inc. v. Barram

Docket Nº:99-1258
Citation:226 F.3d 1329
Party Name:ACE-FEDERAL REPORTERS, INC., ANN RILEY & ASSOCIATES, LTD., AR-TI RECORDING, INC., CALIFORNIA SHORTHAND REPORTING, EXECUTIVE COURT REPORTERS and MILLER REPORTING CO., INC., Appellants, v. David J. Barram, ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, Appellee.
Case Date:September 28, 2000
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 1329

226 F.3d 1329 (Fed. Cir. 2000)

ACE-FEDERAL REPORTERS, INC., ANN RILEY & ASSOCIATES, LTD., AR-TI RECORDING, INC., CALIFORNIA SHORTHAND REPORTING, EXECUTIVE COURT REPORTERS and MILLER REPORTING CO., INC., Appellants,

v.

David J. Barram, ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, Appellee.

99-1258

United States Court of Appeals, Federal Circuit

September 28, 2000

Appealed from: General Services Administration Board of Contract Appeals

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Ronald K. Henry, Kaye, Scholer, Fierman, Hays, Handler, LLP, of Washington, DC, argued for appellants. Of counsel was Mark A. Riordan.

Richard P. Schroeder, Trial Attorney, Commercial Litigation Branch, Civil Division, Department of Justice, of Washington, DC, argued for appellee. With him on the brief were David W. Ogden, Assistant Attorney General; David M. Cohen, Director; and Harold D. Lester, Jr., Assistant Director. Of counsel on the brief was John E. Cornell, Sr. Assistant General Counsel, Office of the General Counsel - LP, General Services Administration, of Washington, DC.

Before MAYER, Chief Judge, MICHEL and SCHALL, Circuit Judges.

MAYER, Chief Judge.

Ace-Federal Reporters, Inc., Ann Riley & Associates, Ltd., AR-TI Recording, Inc., California Shorthand Reporting, Executive Court Reporters, and Miller Reporting Co., Inc. (collectively, the "contractors") appeal from a decision of the General Services Administration (GSA) Board of Contract Appeals, denying their claims for breach of contract. See Ace-Federal Reporters, Inc. v. Gen. Servs. Admin., 99-1 B.C.A. (CCH) ¶ 30,139 (Oct. 30, 1998). Because the board erred in concluding that the terms of the contracts preclude recovery of lost profits, we reverse and remand.

Background

In 1988, GSA issued a request for proposals for transcription and court reporting services for various federal agencies. The request for proposals contemplated multiple award schedule contracts to be "made with more than one supplier for comparable items at either the same or different prices for delivery to the same geographical area." 41 C.F.R. § 101-26.408-1(A) (1988). GSA awarded contracts to ten companies, including the six appellants.

Included in each contract was the standard requirements clause found in Federal

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Acquisition Regulation § 52.216-21(c) which provides, "[e]xcept as this contract otherwise provides, the Government shall order from the Contractor all the supplies or services specified in the Schedule that are required to be purchased by the Government activity or activities specified in the Schedule." 48 C.F.R. § 52.216-21(c) (1988). Each contract also included a termination for convenience clause that limited government liability should GSA cancel them. The parties stipulated that during the term of the contracts, some of the agencies covered by the contracts contracted for transcription services with companies that were not parties to the contracts. According to 41 C.F.R. § 101-26.401-3 (1988), and other evidence in the record, this was not permitted absent a waiver from GSA.

In 1995, the contractors filed claims with the contracting officer alleging breach of their contracts because of the unauthorized off-schedule purchases and seeking lost profits and consequential damages. The contracting officer declined to take action. The contractors appealed to the board, which consolidated their claims. Before the board, GSA raised six defenses to any potential liability: (1) the termination for convenience clause precludes recovery of lost profits; (2) the contractors should not recover damages because they had received orders in excess of estimates in the request for proposals; (3) grand jury reporting was not covered by the contracts; (4) off-schedule purchases made at a lower price were permissible; (5) the...

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