The Contract Disputes Act (the “CDA”), 41 U.S.C.A. §§ 7101 et seq., which has provided the statutory framework for resolution of most contract disputes between the federal government and its contractors since 1978, has recently been the subject of changes in judicial interpretation, despite no corresponding statutory changes. The CDA’s implementing provisions in the Federal Acquisition Regulations (FAR), require that contractors submit a claim to the government in the form of written demand to a contracting officer requesting a final decision and seeking the payment of money in a sum certain prior to pursuing resolution via board or court. However, with respect to the sum certain requirement, the United States Court of Appeals for the Federal Circuit issued an opinion in late 2023 determining that this requirement “should not be given the jurisdictional brand” as it has categorically received in the past. Rather, the court concluded that the sum certain requirement is merely an element of a claim for relief under the CDA that a contractor must satisfy to recover. This rebranding does not debase the sum certain requirement, but it does indicate a renewed focus on what constitutes “jurisdictional” in government contracts litigation.
The Contract Disputes Act
To pursue a claim under a federal contract, contractors must abide by the CDA’s statutory requirements. The applicable procedures are specified under § 7103, which describe the time, manner, and certification of contractor claims, as well as the time, manner, and finality of the contracting officer’s responsive decision. For the contractor’s part, any contractor seeking to submit a claim to the government relating to a contract must submit each claim: 1) in writing; and 2) within 6 years of the accrual of the claim. 41 U.S.C.A. §§ 7103(a)(2)(4). For claims exceeding $100,000, the contractor must certify that the claim by an individual authorized to bind the contractor with respect to the claim. Id. at § (b)(2). The statute provides the certification language at § 7103(b)(1): the contractor shall certify that the claim is made in good faith; the supporting data are accurate and complete to the best of the contractor’s knowledge and belief; the amount requested accurately reflects the contract adjustment for which the contractor believes the government is liable; and the certifier is authorized to certify the claim on behalf of the contractor.
The contractor’s claim must be submitted to the Contracting Officer (“CO”). The Contracting Officer “shall issue a decision in writing” and furnish that decision to the contractor “within a reasonable time.” §§ 7103(d) & (f)(3). For certified claims over $100,000 the CO has 60 days from receipt of the claim to issue a decision or notify the contractor of the time in which a decision will be issued. For claims under the $100,000 threshold, the CO is required to issue a decision within 60 days from receipt of the contractor’s claim, but only if the contractor submits a written request that a decision be rendered within that period. Id. at §§ 7103(f)(1) & (f)(2). Failure by a CO to issue a decision on a claim within the required time is deemed to be a denial of the claim and the contractor can then commence an action or an appeal. Id. at § (f)(5). The statute requires only that a CO’s decision “state the reasons for the decisions reached” and “inform the contractor of the contractor’s rights” under the CDA. Id. at § (e).
Once the CO’s decision is issued, or denial by lapse of time has otherwise occurred, the CO’s decision is considered final, and the contractor’s right to appeal the decision is limited by § 7104 of the CDA. The contractor may appeal the decision to an agency board in accordance with § 7105 (Agency Boards) within 90 days from the date of receipt of the CO’s decision; or bring an action directly on the claim in the United States Court of Federal Claims (COFC) within 12 months from the date of receipt of the CO’s decision. See §§ 7104(a) & (b).
The Sum Certain Requirement
The CDA does not contain express “sum certain” language , nor does it expressly define “claim.” However, federal courts have historically relied upon FAR 52.233-1 (“Disputes”) for this requirement. FAR 52.233-1(c) defines “claim” as “a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to this contract.” Thus, in the past, the courts have required that a claim submitted pursuant to the CDA must meet the definition of a claim under the FAR’s dispute provision, which requires that contractors seek an amount of money in a sum certain. See, e.g., M. Maropakis Carpentry, Inc. v. United States, 609 F.3d 1323, 1327 (Fed. Cir. 2010); Estes Express Lines v. United States, 123 Fed. Cl. 538, 546 (2015). To satisfy the sum certain requirement, the contractor must provide a clear, unequivocal statement of the amount of money it is requesting. CPS Mech. Contractors, Inc. v. United States, 59 Fed. Cl. 760, 764 (2004); Contract Cleaning Maint., Inc. v. United States, 811 F.2d 586, 592 (Fed Cir. 1987) (finding that a claim submitted under the CDA must clearly and unequivocally give the contracting officer “adequate notice of the basis and amount of the claim.”).
Until recently, courts have consistently concluded that where a “monetary claim” fails to identify a “sum certain,” that failure is “fatal to jurisdiction under the CDA.” Northrop Grumman Computing Sys., Inc. v. United States, 709 F.3d 1107, 1112 (Fed. Cir. 2013); see also Reflectone, Inc. v. Dalton, 60 F.3d 1572, 1575 (Fed. Cir. 1995). For instance, the court in J.P. Donovan Const., Inc., affirmed the ASBCA’s decision to grant the Navy’s motion to dismiss a subcontractor’s claim for runway repairs on the basis that the subcontractor failed to state a sum certain, which was required for boards and courts to exercise jurisdiction under the CDA. See J.P. Donovan Const., Inc. v. Mabus, 469 F. App’x 903 (Fed. Cir. 2012).
Similarly, in Flandreau Santee Sioux Tribe v. United States, Flandreau Santee Sioux Tribe (“the Tribe”) brought an action under the CDA against federal government and federal officials, seeking damages for alleged underpayment under the Indian Self Determination Education and Assistance Act (ISDEAA). When challenged, the Tribe argued that it satisfied the “sum certain” requirement because the claim was “stated in a manner which allows for reasonable determination of the recovery available at the time presented.” 565 F. Supp. 3d 1154, 1179 (D.S.D. 2021), recon. denied, 610 F. Supp. 3d 1225 (D.S.D. 2022) (quoting Metric Constr. Co. v. United States, 1 Cl. Ct. 383, 391 (1983)). After reviewing claim letters and Dispute Calculation and Information forms, the court concluded that the Tribe’s claim value could not be easily determined from a simple mathematical calculation. See, e.g., Modeer v. United States, 68 Fed. Cl. 131, 137 (2005), aff’d, 183 F. App’x 975, 977 (Fed. Cir. 2006) (the sum certain requirement is met “if the contracting officer can determine the amount by a simple mathematical calculation.”). Further, the court found that the Tribe did not specify to the contracting officer “any other documents that provided a clear and unequivocal indication as to the amount sought by the Tribe on these claims.” Id. at 1179–80. Because the Tribe failed to meet the sum certain jurisdictional requirement for its claim, the court dismissed the claim for lack of jurisdiction without further inquiry.
The Court Of Appeals For The Federal Circuit’s Jurisdictional Rebranding
Historically, courts and boards have concluded that the sum certain requirement found in the FAR’s dispute provisions are “jurisdictional prerequisites” under the CDA, meaning that, if the board or court determines that any of the requirements have not been expressly met, the board or court must dismiss the case for lack of jurisdiction. Courts have generally looked to the CDA and the Tucker Act for guidance on applicable jurisdiction. The Tucker Act provides in relevant part that the COFC has limited jurisdiction to adjudicate “any claim against the United States founded either upon the Constitution, or any Act of Congress or any regulation of an executive department, or upon any express or implied contract with the United States, . . .” which includes the “jurisdiction to render judgment upon any claim by or against, or dispute with, a contractor arising under [the CDA], . . . on which a decision of the contracting officer has been issued . . .”. See 28 U.S.C. §§ 1491(a)(1) & (a)(2). Essentially, courts have derived jurisdiction to adjudicate CDA claims from the Tucker Act. See Just in Time Staffing v. United States, 143 Fed. Cl. 405, 410 (2019) (“The Court has jurisdiction, under the Tucker Act, to adjudicate a [CDA] claim ….”).
Notwithstanding, the Court of Appeals for the Federal Circuit recently departed from this rule, concluding that the requirement to state a sum certain in a claim submitted is not a jurisdictional requirement under the CDA . See ECC Int’l Constructors, LLC v. Sec. of Army, 79 F.4th 1364 (Fed. Cir. 2023). In this appeal of a decision of the ASBCA dismissing a contractor’s claim for compensation for construction delays on a military compound, the court explained that the distinction between whether the sum certain requirement is jurisdictional or non-jurisdictional is often of little consequence, but the unique facts of this case prompted a re-examination of the nature of the sum certain requirement.
The court first outlined the nature and consequences of jurisdictional rules, highlighting the “harsh consequences” of characterizing a rule as jurisdictional. See ECC Int’l at 1368. Because objections to subject-matter jurisdiction may be raised at any time, a motion challenging jurisdiction could stymie a claimant’s ability to recover as well as impede any opportunity to timely refile. Id. at 1368, 1370. Relying on the Supreme Court’s recent guidance in MOAC Mall Holdings LLC v. Transform Holdco LLC, 598 U.S. 288, 297 (2023) that “a clear statement from Congress is necessary to consider a rule jurisdictional,” the court concluded that Congress has not provided a clear statement regarding the sum certain requirement when in fact, the sum certain requirement is not even mentioned in the CDA, nor is there any statutory language linking the sum certain to the CDA. Id. at 1373-74. While prior cases have identified the sum certain requirement as jurisdictional based on the FAR’s definition of a “claim,” the court found that this did not constitute statutory text sufficient to deem the sum certain requirement “jurisdictional.”
Notably, the Court in ECC Int’l Constructors, LLC did not reference the Tucker Act in the body of its opinion, giving it credence only in a footnote that states: “The COFC has jurisdiction over CDA claims pursuant to [the Tucker Act].” See ECC Int’l Constructors, LLC v. Sec. of Army, 79 F.4th 1364, n. 10 (Fed. Cir. 2023). Recognizing that jurisdiction granted by the CDA and Tucker Act are not relevant to the jurisdictional status of the sum certain requirement, the court properly stated that: “From a sovereign-immunity perspective, the analysis is no different. Although waivers of sovereign immunity are to be construed narrowly, the CDA clearly waives the United States’ sovereign immunity with respect to a claim. To consider the sum-certain requirement jurisdictional could potentially narrow the government’s waiver by excluding some portion of claims with defective requests for monetary relief. But we do not find that this narrowing function justifies considering an otherwise nonjurisdictional provision to be jurisdictional.” Id. at 1378.
Consequently, this ruling does not negate the need to state a sum certain or otherwise meet the mandatory requirements of the CDA in submitting a claim seeking monetary relief under the CDA. Indeed, the court stated that as a result of its ruling, the contractor’s claim was not dismissed and the contractor was permitted to proceed to argue that the government forfeited its sum-certain challenge. See ECC Int’l Constructors, LLC v. Sec. of Army, 79 F.4th 1364, n. 15 (Fed. Cir. 2023). The court stated, “[t]he sufficiency of a sum certain in a given case is a matter for the Board to explore on the merits. While a deficient sum certain may in some circumstances be a reason to reject all or part of a claim, it does not mean the Board lacks jurisdiction entirely.” Id. at 1377. This sentiment was reiterated in HEALTHeSTATE, LLC v. United States. See 168 Fed. Cl. 624, 638 (2023) (appeal filed Jan. 8, 2024) (“Plaintiff did not properly submit to the CO a claim containing a sum certain, and thus it has failed to establish an essential element of its CDA claim. Additionally, unlike in ECC [Int’l Constructors, LLC.], Defendants have not waived or forfeited their challenge to the lack of a sum certain given the litigation history in this case.”).
The beneficial impact of this ruling for contractors is thus really limited to situations where the contractor has failed to properly specify a sum certain for its claim(s), has proceeded with an appeal from the CO final decision to a board or COFC, and the government fails to timely challenge the contractor’s claim for failure to meet the CDA’s sum certain requirement. As the court explained, challenges to subject matter jurisdiction can be raised at any time in a proceeding and/or be raised sua sponte, but challenges that are not classified as “jurisdictional” can be forfeited if the government waits too long to challenge. Thus, a slightly larger burden has been shifted to the government as a result of ECC Int’l Constructors, LLC.
This holding, however, could have wider impact as courts and boards pay more attention to what should and should not be classified as jurisdictional, which appears to be a hot topic lately for the Court of Appeals for the Federal Circuit. For instance, other FAR provisions that have intersected with federal statutes may similarly be rebranded, and although still applicable, may lose their status as grounds for case dismissal on the basis of jurisdiction. Indeed, around the same time that ECC Int’l Constructors, LLC was published, the Court of Appeals for the Federal Circuit published a parallel ruling in M.R. Pittman Grp., LLC v. United States. There, departing from precedent, the court held that the Blue & Gold waiver rule, which requires government contractors to object to a patent error in a government solicitation prior to the close of the bidding period, is nonjurisdictional. 68 F.4th 1275, 1279–80 (Fed. Cir. 2023); see Blue & Gold, Fleet, L.P. v. United States, 492 F.3d 1308 (Fed. Cir. 2007). While the Tucker Act (28 U.S.C. § 1491(b)(1)) waives the government’s sovereign immunity for bid protests, the court reasoned that “the requirement that a party object to a solicitation containing a patent error prior to the close of bidding does not speak to the COFC’s authority to hear a case, but only to that party’s procedural obligations.” M.R. Pittman at 1280. Relying once again on Supreme Court precedent, the court concluded that the rule “is more akin to a nonjurisdictional claims-processing rule since it ‘seeks to promote the orderly progress of litigation by requiring that the parties take certain procedural steps at certain specified times.’” Id. (citing Fort Bend Cnty., Texas v. Davis, 139 S. Ct. 1843, 1848 (2019)) for reliance upon the distinction between “jurisdictional prescriptions” and “nonjurisdictional claim-processing rules”).
The court concluded that the COFC does not lose jurisdiction over a disappointed bidder’s post-award bid protest claim, despite the protest grounds pertaining to a patent error in the solicitation and the bidder’s failure to timely raise the objection, because this is a nonjurisdictional issue to be decided on the merits. Id. at 1280-81. Thus, the court once again indicated that courts and boards should look outside the Tucker Act when dealing with sub-matters of government contract jurisdiction, and concluded that courts have historically been too quick to label certain applicable government contract rules as jurisdictional. In doing so, the court has potentially opened the door for a widespread rebranding of what constitutes “jurisdictional” in the realm of government contracts.
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