Public Contract Law Journal

After Arbaugh: Neither Claim Submission, Certification, Nor Timely Appeal Are Jurisdictional Prerequesites to Contract Disputes Act Litigation

by Nathaniel E. Castellano

Nathaniel Castellano (nathaniel.castellano@apks.com) is an associate in the government contracts practice group at Arnold & Porter Kaye Scholer LLP and an adjunct professor at the George Washington University School of Law. He graduated from GWU Law as a Murray Schooner Procurement Scholar and clerked for the Honorable Jimmie V. Reyna at the U.S. Court of Appeals for the Federal Circuit. He thanks Ralph C. Nash, Paul E. Pompeo, Steven L. Schooner, and Gregory C. Sisk for their valuable contributions and insights on this topic.

As we approach the fortieth anniversary of the Contract Disputes Act of 19781 (CDA), this foundational waiver of sovereign immunity continues to be riddled with the tell-tale signs of repeated “drive-by jurisdictional rulings.”2 This unfortunate state of affairs shocks the conscience when considered in light of the Supreme Court’s systematic efforts to root out such travesties by directing lower courts to reassess prior jurisdictional classification of statutory requirements.3 To guide this effort, the Court — through a nascent series of opinions dating back to the 2006 decision in Arbaugh v. Y&H Corporation4 — has provided a bright-line rule that a statutory requirement is jurisdictional only if Congress has expressed a clear intent that the requirement  carries  jurisdictional  weight.5 Heeding  the  Supreme  Court’s call, in 2014, the U.S. Court of Appeals for the Federal Circuit issued its Sikorsky Aircraft Corporation v. United States decision,6 holding that the CDA’s statute of limitations is a nonjurisdictional claim processing requirement — despite the Circuit’s prior precedent treating the deadline as jurisdictional.7 Notwithstanding this step in the right direction, the Federal Circuit continues to reflexively treat the CDA’s claim submission requirements as jurisdictional prerequisites to CDA litigation.8 Applying the Supreme Court’s new bright-line rule to other CDA requirements that have been traditionally classified as jurisdictional, this article demonstrates that neither claim submission, certification, nor timely appeal requirements are jurisdictional prerequisites to CDA litigation. It concludes by urging contractors and their counsel to raise the arguments herein before the Federal Circuit and provides practical suggestions for doing so.

I.   Introduction

In the 1970s, Congress touted the CDA as a comprehensive reform designed to create a fair, efficient, and flexible process for resolving procurement contract disputes. It was intended to provide contractors of all sizes and sophistication access to meaningful due process and judicial review.9 Prior to the CDA, contractor claims often encountered delays while winding their way through agency-specific administrative processes, and access to meaningful judicial review was contingent on arbitrary jurisdictional distinctions between claims for breach of contract and claims “arising under” a contract clause.10 To remedy this, Congress adopted several recommendations made by the Commission on Government Procurement.11 These recommendations were designed to promote efficiency and fairness in U.S. procurement policy — specifically to encourage companies to do business with the government, which, in turn, would increase competition in the procurement market.12

Despite congressional aspirations of fairness and efficiency, decades of judicial and administrative interpretations left the CDA riddled with unintuitive, subjective, and highly contextual procedural traps for the unwary.13 Worse yet, the Federal Circuit and its predecessor (the U.S. Court  of Claims) labeled many of these procedural requirements as jurisdictional, allowing for extraordinary disruptions to the dispute resolution process.14

Consider the following hypothetical. A contractor submits a claim to the contracting officer seeking payment for increased costs incurred during performance. After a brief correspondence, the contracting officer submits a decision allowing the claim in part but denying some of the requested payment. On appeal at one of the Boards of Contract Appeals, agency counsel does not raise any jurisdictional concern. After a full trial, the Board finds in favor of the contractor and directs payment of the full amount claimed. On appeal at the Federal Circuit, for the first time, the Department of Justice moves to dismiss the case for lack of jurisdiction because the contractor failed to fully comply with one of the claim submission formalities — e.g., the contractor failed to request, implicitly or expressly, a decision from the contracting officer. The Department of Justice asserts that the overall tenor of the correspondence between the contractor and contracting officer indicates that the contractor may have desired further negotiation, and therefore, all subsequent proceedings were legally void.15 The Federal Circuit reflexively recites its maxim that the claim submission requirement is a jurisdictional prerequisite to CDA litigation and accordingly dismisses the case. After years of litigation, the contractor must begin anew by more clearly requesting a contracting officer’s final decision on its claim. Because jurisdictional objections can be raised at any time and may never be waived or conceded, it does not matter that: (1) the contracting officer did issue a decision; (2) the government never objected to jurisdiction at the Board; or (3) the contracting officer’s decision is substantively irrelevant because review at the Board is de novo.16

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