Rashed Elham Trading Company

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeals of -- )
)
Rashed Elham Trading Company ) ASBCA Nos. 58383, 58619, 58620
)
Under Contract No. W91B4N-l l-D-7001 )

APPEARANCE FOR THE APPELLANT: William J. Spriggs, Esq.
Spriggs Law Group
Lynchburg, VA

APPEARANCES FOR THE GOVERNMENT: Raymond M. Saunders, Esq.
Army Chief Trial Attorney
MAJ Christopher M. Coy, JA
Erica S. Beardsley, Esq.
Trial Attorneys

OPINION BY ADMINISTRATIVE JUDGE NEWSOM

These appeals concern the termination for cause of a commercial contract to
transport cargo and fuel in support of contingency operations in Afghanistan, and a
related claim for breach of contract. After a hearing and post-hearing briefing, the Board
upholds the termination and denies the appeals.

FINDINGS OF FACT

1. On 12 August 2011, the Bagram Regional Contracting Center, a component of
the United States Department of Defense Central Command, awarded Contract
No. W91B4N-l l-D-7001 (contract) to appellant, Rashed Elham Trading Company
(RETC) (R4, tab 1 at 2, 76). This contract was one of several National Afghan Trucking
(NAT) contracts awarded to contractors to transport supplies, equipment, and other assets
to and from sites in Afghanistan (id. at 77; tr. 1/33).

2. RETC's NAT contract was an indefinite-quantity, indefinite-delivery contract
for an estimated value of AFN 20,771,689,159 in Afghanistan currency (R4, tab 1 at 2,
4). The contract included a 12-month base period of performance from 16 September
2011 to 15 September 2012, followed by 2 option periods which together totaled
15 months (id. at 14; tr. 1/29).

3. The contract incorporated FAR 52.212-4, CONTRACT TERMS AND CONDITIONS
- COMMERCIAL ITEMS (JUN 2010). Subsection (m), entitled Termination for cause,
identifies the permissible grounds for a termination for cause, stating in relevant part:

The Government may terminate this contract. or any part
hereof, for cause in the event of any default by the Contractor,
of if the Contractor fails to comply with any contract terms
and conditions, or fails to provide the Government, upon
request, with adequate assurances of future performance.

(R4, tab 1 at 15)

4. Transportation missions were divided into three categories, called "suites."
Suite 1 was for transportation of bulk fuels, Suite 2 was for transportation of dry cargo,
and Suite 3 was for transportation of heavy cargo (R4, tab 1 at 9-13; tr. 1/33).

5. The contract's Performance Work Statement (PWS) described the work,
performance standards, and procedural requirements. Pursuant to Subpart 1.4, RETC
was required to provide "secure ground transportation of [various classes of] cargo
throughout Afghanistan" and "all management and logistics support resources necessary
to pickup material and equipment at origin and deliver material and equipment at
destination on the dates required by the USG" and required to "ensure the integrity and
safety of the materials and equipment being transported" (R4, tab 1 at 77).

I. Significant Contract Requirements

A. Minimum Assets

6. Three general categories of contract requirements are significant to this dispute.
First, PWS Subpart 5.1 and Technical Exhibit 4 required RETC to maintain availability
of a minimum number of assets for assignment of transportation missions (R4, tab 1
at 82-83, 99). "Assets" in this context meant trucks, containers, and specialized trailers
called ""lowboys" or "super lowboys" (id. at 99). PWS Subpart 6.2 required RETC daily
to report the status of its assets, including "assets available for dispatch within 96 hours''
(id. at 90).

B. Documented Compliance with Mission Requirements

7. Second, the PWS set forth detailed performance and documentation
requirements. The government initiated a mission by issuing to RETC a Transportation
Movement Request (TMR), also called a "mission sheet." (R4, tab 1 at 91, 101; tr. 1/34)
The TMR defined mission requirements, which could include origin and destination,
dates for pickup and delivery, the commodity being transported, required security, or
other data (R4, tab 165 at 16 I 5, tabs 22-23, 69 at 651; tr. 1134, 92-93). Pickup was

2
 known as "upload" and the date for pickup was called the "required spot date" or RSD. 1
Delivery was known as "download" and the date for delivery was alternately called the
"required download date," or "required delivery date," or RDD. (R4, tab 1 at 26, 93)

8. At upload and download, RETC was required to obtain signatures of authorized
government personnel on the TMR; these signatures verified that the cargo had been
picked up and delivered (R4, tab 165 at 1615-17; tr. 1/91-93). PWS Subpart 6.7 required
RETC to submit the original, signed TMR to the government ""within 28 days" after
delivery. If a TMR had been misplaced or a signature could not be obtained, RETC
could obtain a memorandum from the government customer, in lieu of the TMR,
verifying mission performance. (R4, tab 1 at 91; tr. 2/153)

9. Along with the TMR, RETC was required to submit other supporting
documentation, notably, satellite transponder "snapshots." PWS Subpart 4.4 required
RETC to attach to its vehicles a satellite transponder that transmitted signals showing the
vehicle location at points in time 2 (R4, tab lat 81-82; tr. 1/41-44). Snapshots would show
that RETC showed up at the correct locations by the RSD and RDD and would establish
wait times for demurrage requests. 3

l 0. PWS Subpart 6. 7 warned that "suspected fraudulent or altered mission sheets
will be investigated by the USG. Payment for any suspected fraudulent or altered mission
sheets will be suspended pending the results of the investigation." (R4, tab 1 at 91) In
addition, certain performance deficiencies could cause the government temporarily to
suspend a contractor from eligibility for new missions until the contractor submitted a
corrective action plan, acceptable to the government, to prevent reoccurrence of the
deficiency (id. at 49).

C. Invoicing and Payment Requirements

11. The third category of significant contract requirements were those governing
invoicing, principally Paragraph Kand PWS Subpart 6.6 (R4, tab 1 at 5, 90-91).

12. Paragraph K required RETC to coordinate with the government to "review all
completed missions against the contract requirements" in advance of invoice
submission. It did not specify who would prepare invoices. Paragraph K stated in

1
In the original contract, the date for pickup was called "required load date" or RLD.
Later, the contract was modified to change this term to "required spot date" or
RSD. (R4, tab 26 at 349)
2
Modification No. POOOO I required RETC to submit snapshots with its TMRs to verify
timely performance (R4, tab 6 at 117 and Revised PWS at 7).
3
"Demurrage" refers to excess time spent waiting on location for upload or download.
PWS Subpart 5.9 entitled RETC to compensation for demurrage (R4, tab 1 at 84).

3
 relevant part:

Prior to the monthly invoice submission, the contractor and
the Government will meet to review all completed missions
against the contract requirements. The Contractor should
have their draft invoice, using the format in Solicitation
Attachment 5, and all supporting documentation covering the
requirements of the PWS paragraph 6.6 available for
discussion.

(R4, tab 1 at 5)

13. PWS Subpart 6.6 also did not specify who would prepare invoices, but
required RETC monthly to submit an invoice "that includes all missions that are closed
out each month." It stated in full:

The Contractor shall provide an invoice to the USG monthly
that includes all missions that are closed out each month for
the invoicing period. The invoice will include charges for all
successfully completed missions, cancelled/prorated
missions, and demurrage, less all applicable deductions.
Deductions may include charges for missing cargo items for
which the Contractor is held financially liable, any items
furnished by the USG (IA W ii 4.2.3, 5.11.2.1.2, 5.12.3.1.2),
PRS deductions, and applicable Contractor demurrage (IA W
ii 5.11.5.4, 5.12.5.4).
(R4, tab 1 at 90-91)

14. A mission would be deemed "failed" - resulting in no pay - for many reasons
including RETC's failure to arrive at the origin or destination on time, its excessive loss
of fuel during a fuel delivery mission, RETC's submission of"falsified or tampered
mission paperwork" or if '"cargo delivery cannot be verified." The government could
deduct from RETC's payments for lost or damaged cargo, RETC's failure to achieve
performance quality standards, or other noncompliances. (R4, tab I at 84, 90-91, 94)

15. On 16 October 2011, the government issued a Memorandum for Record
(MFR) establishing deadlines for submission of TMRs and assigning responsibilities for
invoice preparation. This MFR, which was not incorporated into the contract through a
contract modification, stated in relevant part:

The 257th JMCB has established the following timeline for
the Nation[al] Afghan Trucking (NAT) contract monthly

4
 invoice. The dates listed below will happen each month,
regardless which day of the week the date falls on.

a. 16th_ 15th (monthly), Mission sheets are turned in for
the billing
b. l 6th_NAT Cell prepares the invoice for COR review
c. 17th_ 1gth, COR reviews the prepared invoice
d. 1gth_ pre-invoices is sent to the carriers
e. 19th_20th, Carrier has time to review the pre-invoice
f. 21 st_22°ct, Discussion period between the COR and
Carrier for monthly invoice (closeout)
g. 2yct -24th, Carrier prepares the final invoice for
WA Wf[ 4l or paper invoice for tum-in
h. 25th (per PWS 6.6, deliverable), The final invoice for
that month is submitted in WA WF or sent via email to
the COR.

(App. supp. R4, tab A-10)

16. Two aspects of this MFR are significant. First, before invoice submission, the
contracting officer's representative (COR) was to review the documents submitted by
RETC to determine which missions were completed and entitled to payment, and whether
any deductions should be applied. Second, the government - not RETC - was to prepare
draft invoices. RETC could review and contest them, but ultimately RETC was required
to submit a government-approved invoice for payment. (App. supp. R4, tab A-10~
tr. 2/104-08)

II. RETC's Performance Problems

17. Problems with RETC's performance surfaced shortly after RETC began
performance in September 2011 and persisted throughout the approximately nine months
that RETC accepted missions. In that period, the government issued at least seven
"Letters of Concern" to RETC regarding what the government perceived as RETC's
noncompliance with contract requirements or other performance issues (R4, tab 3 (failure
to submit deliverables), tab 35 (super lowboy (SLB) inspection), tab 43 (SLB
noncompliance), tab 93 (pilfered container), tab 115 (insufficient assets), tab 137 (failure
to satisfy acceptable quality levels), tab 141 (various matters)).

18. As detailed below, on three occasions the government suspended RETC from
eligibility for new missions until it submitted an acceptable corrective action plan to

4 Invoices were to be submitted into the Wide Area Work flow (WA WF), a Department
of Defense application (R4, tab 6 at 132, tab 9 at 142).

5
address what the government perceived as performance deficiencies. On other occasions,
the government deemed RETC to be responsible for a variety of performance problems. 5
(Findings I9, 22, 24, 29, 36, 40, 47)

A. First Suspension

19. The first suspension occurred on 7 January 2012, when the government
suspended RETC from eligibility for certain missions for RETC's failure to maintain a
sufficient number of assets called "super lowboys" (R4, tabs 45, 46). RETC submitted a
corrective action plan, which was accepted, and the government lifted the suspension on
18 January 20 I2 (R4, tab 57).

B. Accident Damaging Mine Resistant Ambush Protected Vehicle

20. Another problem arose on 22 January 2012, when RETC's subcontractor
crashed while transporting a government-owned Mine Resistant Ambush Protected
(MRAP) vehicle, costing $224,341.94 in repairs (R4, tabs 75, 118-19, I29; tr. 1/49).
On 29 March 2012, an investigator concluded that "[o]verwhelming facts point to the
possible cause as either mechanical issues or the driver" (R4, tab 119 at I I 00).

21. PWS Subpart 5. 7, Cargo Responsibilities, provided in pertinent part that:

It is the Contractor's responsibility to properly secure loads
for transport IA W PAM 55-20. The Contractor shall be
financially liable for cargo loss, pilferage, or damage
incurred due to improperly securing cargo loads, negligent or
improper driving by the operator, improperly handling cargo,
or unauthorized trans-loading or cross-loading of cargo.

(R4, tab 1 at 84) (Emphasis added)

22. On 30 March 2012, the government notified RETC that it would hold RETC
liable for the repair costs. At the time, RETC did not object to being held liable; it only
objected to the amount that RETC was charged, stating that RETC "should only be liable for
the repairs not an added expenditure limit." (R4, tab 128 at 1233-34, tab 129; tr. 2/93-94)

5 Despite the performance problems, the government's monthly surveillance reports
assessed RETC as compliant with the contract requirements, at least for the period
September 2011 through February 20I2 (R4, tabs 8, 24, 44, 133-34). The COR
testified, and we find, that the monthly surveillance reports were based on
incomplete information and were inaccurate (tr. 3/132-33).

6
 C. Second Suspension

23. RETC's second suspension occurred on 8 March 2012 and arose out of a theft
of a government container (R4, tab 93). Between 29 October 2011and22 November
2011, a government container went missing while being transported by RETC (R4, tab 25
at 339-40). In response to government queries, RETC at first asserted that the container
had been delivered, and provided the "completed TMR#AAJ4928" for the mission (R4,
tab 25 at 341, 345; tr. 2/72). Investigators detennined that the container had likely been
stolen and the signature on the TMR likely had been forged (R4, tab 69 at 648, 651,
tab 70 at 658; tr. 2/81-82).

24. On 8 March 2012, the government suspended RETC from new missions until
it submitted a corrective action plan (R4, tab 93 at 944). At the time, RETC conceded
that the container had been stolen and the TMR had been forged, but blamed its
subcontractor, stating:

RETC does acknowledge that a registered
sub-contractor for RETC was involved with an incident that
initiated an investigation by CID.
Omar Amin Trading Company was involved in theft of
USG property and forgery in an attempt to collect payment.. ..

RETC does understand that we are liable for
the actions of all sub-contractors and drivers of each
sub-contractor.

(R4, tab 99 at 980; tr. 1/81)

25. On 15 March 2012, the government lifted RETC's suspension but noted that
RETC would be held liable for $257,675.00 in lost property (R4, tabs 70, 91, 100, 830
at 379-383; tr. 2/83). As later developments showed, pilferage and concerns about
possible forgery on RETC missions persisted (findings 27, 36, 41, 50).

26. Indeed, a few weeks later, on 8 April 2012, RETC submitted to the
government a memorandum, apparently signed by a government official, stating that the
missing container had been located. RETC requested reimbursement for the charges
assessed against it for the lost property. (R4, tab 149 at 1499-1500)

7
 27. The person who purportedly signed this memorandum, SGT Erika Brooke, 6
informed the COR that "[t]his is a forged memorandum of my signature. I have no[t]
produced a memorandum like this and this is not my signature." (R4, tab 150 at 1502)
She testified that the signature was "completely not mine" and that the memorandum had
not been prepared by her (tr. 2/85-89).

D. Difficulties with Invoicing and Payment

28. In December 2011, RETC submitted invoices for missions completed between
16 September 2011and15 November 2011, and received payment of$509,470.26 on
24 January 2012 (R4, tabs 7, 11, 66). Thereafter, RETC experienced difficulties with
invoice preparation (R4, tab 71 at 662, tab 84 at 832; tr. 11101-03).

29. In many instances, RETC submitted late, incomplete, or inaccurate TMRs, or
TMRs that the government suspected were forged (R4, tab 165; tr. 1191-96, 2169- 72).
SGT Brooke testified that when submitting requests for payment for demurrage, RETC's
packages were "improperly put together." She '"explained several times'' to RETC's
program manager "how to do this," adding:

[F]or the most part the carriers could all put this together
properly. But for some reason I just had issues with RETC .

.. .I explain[ ed] to him that I need snapshots of the
truck at origin or destination.... I need to know if your truck
arrived at origin or destination on time because if they didn't
you're not entitled to the demurrage per the PWS.

So I needed that, and he didn't provide it.

(Tr. 2/69-70)

30. IfRETC lacked records to support payment, the government would allow it to
roll that TMR over to the next month "giving the carrier [a] whole other month to find
infonnation on that TMR" (tr. 2/111 ). In other instances, RETC failed to perform in
accordance with the PWS, or government property went missing, resulting in a mission
failure with no pay, or deductions (R4, tabs 91, 148-49, 383, 385; tr. 2172-78, 82-89,
96-97). The government rejected approximately 55 percent of the invoices that RETC
submitted, and on at least one occasion it took RETC months to revise and resubmit the
paperwork (R4, tab 406; tr. 1127-28, 35-36).

6 SGT Brooke was later promoted (tr. 2/64). We refer to SGT Brooke by the rank she
held during the events leading up to the termination.

8
 31. CPT Joseph Guess, the COR, reviewed TMRs submitted by RETC. He noted
that he "personally [spent] hours confirming all the no shows" - meaning occasions in
which RETC trucks did not arrive to pick up cargo (R4, tab 109 at 1032). Concerns
about possible forgeries required additional investigation. For instance, while
investigating a TMR turned in by RETC, CPT Guess asked a military service member
whether his signature on a TMR was authentic. He replied, "[t]hat is not my writing on
that TMR. My name is misspelled for one." (R4, tab I 07 at 1024-26)

32. RETC contends that the government was slow to prepare invoices and that the
resulting payment delays caused problems with RETC subcontractors "because they were
not being paid" (tr. 3/24). RETC's evidence, including an invoice tracking log and
emails complaining about slow delivery of invoices, is unpersuasive. While RETC's
evidence established that there were delays in invoice preparation, it does not establish
that the government caused these delays (R4, tabs 71, 90, 138, 192, 283; supp. R4,
tab 406; tr. 3/23-24). In contrast, the government presented evidence that RETC's
submission of late, incomplete, or inaccurate TMRs caused delay (R4, tab 109 at 1032,
tab 165; tr. 1191-96, 2/69-72).

33. Also, RETC offered no financial records or communications with
subcontractors demonstrating a causal connection between delayed payments and poor
subcontractor performance. Considering all the evidence, we find that government
payment delays were not a controlling cause ofRETC's performance problems.

34. Nevertheless, RETC complained about government rejections of its TMRs,
particularly for fuel missions (R4, tab 84 at 832). On 22 March 2012, RETC's Program
Manager, Ricky Jordan, claimed that the government improperly rejected "hundreds" of
RETC's fuel TMRs that had "clear undeniable signatures," stating:

There is a serious disconnect between the downloading units
and the units doing the DD250[.] The military can say any
signature[] is suspicious and that in tum hits the carrier with
forgery. The military does not have a verifiable means of
verifying signatures or persons dedicated to downloads or
DD250 preparation and this leaves the carrier no way to
defend its self

(R4, tab 108) He requested a meeting with the contracting officer and COR (id.).

E. Pilferage of Government-Owned Fuel During RETC Fuel Missions

35. L TC Edward Gosline, who was the contracting officer at that time, and
CPT Guess met with RETC on 22 March 2012 (R4, tab 109; tr. 1126, 74-76, 2/169).
Based upon subsequent events detailed below, we surmise that LTC Gosline and

9
CPT Guess informed RETC during this meeting that government fuel had disappeared
during RETC fuel transportation missions and that RETC would be charged for the
losses.

36. The following day, 23 March 2012, RETC's Mr. Jordan, admitted that
approximately 80,000 gallons of government fuel "had come up missing," and blamed an
RETC subcontractor forthe losses (tr. 1/74-76, 3155, 117-19; R4, tabs 111-12).

37. These fuel losses could, under the contract, be charged to RETC. PWS
Subpart 5.10.5 contemplated that some fuel loss on a fuel delivery mission could occur,
and fuel loss of up to five percent was acceptable. But fuel loss of greater than five
percent would result in a failed mission, no pay, and a charge to the contractor for
missing fuel. Subpart 5.10.5 stated:

The Contractor shall be financially liable for missing and/or
contaminatedfuel at the rate ofAFN 737 per gallon. The
Contractor will be charged a maximum of AFN 3,685,000 for
5,000 gallon fuel tanker missions and a maximum of AFN
7,3 70,000 for I 0,000 gallon fuel tankers missions. Fuel
losses of up to five percent (5%), due to evaporation and all
other reasons (including inaccuracy of measurement) are
acceptable. Fuel missions with losses exceeding 5% are
considered a failed mission. This 5% allowance is not
applicable to instances when the entire load is missing; the
Contractor will be held liable for 100% of the fuel uploaded.
If there is fuel remaining in the tanker after download, the
Contractor must return all remaining fuel to the location
designated by the USG.

(R4, tab I at 85) (Emphasis added)

38. On 25 March 2012, RETC requested, and was granted, permission temporarily
to report fewer than minimum assets available "until [RETC] figure[s] out the extent of
the problems with our subs" (R4, tab 115 at 1048, tab 116 at 1052; tr. 1/72). Starting
5 April 2012 and continuing for the next five months until its termination in September
2012, RETC reported zero assets available for new missions (R4, tabs 167, 169; tr. 2/177,
3/115, 120).

39. Mr. Jordan denied knowledge of the fuel pilferage and blamed his lack of
awareness on the government's slowness in preparing invoices, stating:

10
 Due to not receiving of the invoices on time from our
previous COR, RETC was not able to distinguish or aware of
the pilferage problems with the sub contractors[.]

(R4, tabs 115-16 at 1051-52) He testified that "the only way that I could track
performance was by the comments from the Government," and reiterated that he did not
know that TMRs had been falsified or that fuel was being pilfered until the government
so informed him (tr. 3/40-42, 54). Apart from this testimony, which is conclusory, RETC
provided no explanation of why it was unable to detect that its subcontractor had not been
delivering fuel and was apparently stealing it.

F. Failure to Meet Acceptable Quality Levels, Failure to Submit a Corrective
Action Plan, and Submission of Allegedly-Falsified TMRs

40. Thereafter RETC's performance problems snowballed. On 3 April 2012, the
government issued a letter of concern for RETC's failure to achieve minimum quality
standards (R4, tab 137). The PWS acceptable quality level (AQL) required the contractor
to be available on time for upload for 90% of missions (R4, tab 1 at 93 ), and to submit
90% of mission sheets to the government on time (id.). The government asserted that
RETC failed to achieve either of these standards for certain suites and directed RETC to
submit a corrective action plan by 10 April 2012 (R4, tab 137).

41. On 4 April 2012, the government identified at least four fuel TMRs submitted
by RETC that the government suspected had been forged or altered to indicate,
inaccurately, that an amount of fuel above the 95% acceptable threshold had been
delivered (R4, tab 140; tr. 2/163-64).

G. RETC Excuses for Performance Deficiencies

42. Mr. Jordan testified that the government was to blame for RETC's failure to
meet RSDs and for fuel losses. According to him, government holding yards were too
small to accommodate the volume of delivery trucks. If a holding yard was too full to
enter, the driver was unable to obtain a snapshot at the required time and location to meet
the RSD. The mission would be recorded as "no pay" or "failed mission." (Tr. 3/69-70)
Mr. Jordan also asserted that the government caused fuel loss by making trucks wait for
days to download. While waiting, the driver "had to run the trucks to stay cool or stay
warm .... That mean[t] burning of fuel." The truck would be ''out of compliance" with
the fuel requirement, resulting in a backcharge to RETC for missing fuel and the mission
treated as a "no pay" or "partial pay." (Tr. 3170- 71)

43. This testimony is unconvincing for three reasons. First, it is self-serving
and RETC has not directed us to corroborating evidence. Second, we cannot credit
Mr. Jordan's assertions as to RETC drivers' conduct during missions because Mr. Jordan

11
admitted that he was unable to monitor his drivers. He testified that "the only way that I
could track performance was by the comments from the Government." (Tr. 3/40-42)
Third, government testimony established that RETC had avenues available to it to redress
these problems (tr. 3/139-40).

H. 4 April 2012 Meeting with the Contracting Officer and Third Suspension

44. On 4 April 2012, Mr. Jordan again met with government representatives
including CPT Guess and LTC Gosline (R4, tab 141; tr. 1185-86, 3/45-46).

45. LTC Gosline recalled that the meeting "essentially culminated to the point
where [RETC] wanted to know how they could be terminated from the contract"
(tr. 1/86). CPT Guess concurred (tr. 21174). Mr. Jordan testified that he "wanted to talk
to them about options for RETC .... They told me the process that would occur ifl didn't
continue to perform. They told me what I would have to do in order to stop that process
of default determination and what would happen if I didn't." (Tr. 3/46-48)

46. Shortly after the 4 April 2012 meeting,7 RETC sent a letter announcing that
"RETC is cancelling our contract." The letter stated in pertinent part:

RETC is cancelling our contract WlB4N-l l-D-7001
SUITE 1- BULK FUELS SUBCLIN-OOlAA, SUITE 2-DRY
CARGO SUBCLIN-OOOIAB, AND SUITE 3 HEAVY
CARGO SUBCLIN- OOOlAC effective May 3, 2012.

RETC is cancelling contract W9 l B4N-l l-D-7001 as per
terms of the contract, RETC is providing 30 day advanced
notice, so the contract will terminate May 3, 2012.

(R4, tab 90) RETC explained that it "is terminating this contract due to the Government
Body violating their agreement under PWS Part 6: Deliverables Descriptions (reference
Technical Exhibit 2) section 6.6 Monthly Invoices." The letter detailed what RETC
characterized as government violations and claimed financial harm, stating:

RETC operated with no funds for services rendered due to no
invoices to enter into WA WF for payment, 6 months of
operation with over a $10 million USD investment and have
no return on investment has placed RETC on the brink of
Bankruptcy forcing RETC to have to terminate the contract

7 The letter bears the date 4 March 2012, but witnesses from both parties testified that
that date was in error. We find that that the letter was received after the 4 April
2012 meeting. (Tr. 1/87, 3/26; R4, tab 90)

12
 for W91B4N-l 1-D-7001 for convenience of the USG and its
valuable cargo due to the inability to continue to operat[ e]
contract W91B4N-1 l-D-7001 with depleted funds and give
the USG the standard Performance required by the contract.

RETC promised to complete existing missions, stating:

RETC understands that a 24 Hour Operation and all standards
of the PWS must be adhered to until the finale issued TMR
currently operating a mission is completed and turned into
COR for review and issue on Finale invoice submitted into
WAWF.

(R4, tab 90)

47. On 5 April 2012, the government suspended RETC for the third time and
rescinded RETC's permission to report minimal assets. The government directed that
RETC submit a corrective action plan by 19 April 2012. (R4, tabs 141, 146)

48. Instead of submitting a corrective action plan, RETC inquired "[w]hen will
RETC receive letter of default for this contract?'' The government replied as follows:

Basically there are two courses of action:

1) If RETC cannot, or chooses not to, submit a [corrective
action plan] by 19 April, procedures for proceeding
towards termination will then [be] initiated, which will
include a cure notice or show cause notice.

2) RETC may submit a corrective action plan (CAP) by the
suspense date listed in the letter. If the CAP is accepted,
RETC would be removed from suspension and would be
required to report assets at that time, and could continue
work. If RETC fails to report adequate assets at that time,
procedures for proceeding towards termination will be
initiated, which will include cure notice or show cause
notice.

13
 In either case, it is the discretion of RETC as to the course of
action to take.

(R4, tab 143 at 1459)

49. The government asserts that RETC did not submit a corrective action plan in
response to the 4 April 2012 notice (tr. 11101). RETC does not contend otherwise. We
find that RETC did not submit this corrective action plan.

I. Submission of Additional Documents that the Government Believed were Forged

50. On 20 April 2012, the government identified at least four more TMRs
submitted by RETC that the government suspected had been altered or forged (R4,
tab 165).

51. In May 2012, RETC submitted a memorandum purportedly signed by a
military officer stating that the MRAP accident was not RETC's fault (R4, tab 179). The
government believed this memorandum had been fabricated, in part because the
investigator "could not find any proof' of the existence of the author, and because of
irregularities in the memorandum 8 (id.; tr. 2/96-97).

III. Cure Notice and Termination

52. On 24 April 2012, the government issued a cure notice to RETC, stating that
its '"overall lack of compliance and failure to perform" were "conditions that are
endangering the performance of the contract." The "conditions" included fuel and cargo
pilferage; RETC's submittal of documents that the government characterized as
"fraudulent" or "forged"; RETC's failure to report adequate minimum assets; its driver's
error resulting in government property damage; and what the government characterized
as RETC's expression of a desire "to be removed from the contract." The notice stated
that "[ u]nless the above described conditions are cured within ten (10) days of
receipt of this notice, the Government may terminate for default in accordance with
[FAR 52.212-4(m)]." (R4, tab 170; tr. 1/99-100)

8 The memorandum stated that "due to Military negligence" the mission "resulted in
damage of the vehicle; the carrier is not responsible for damages." The
memorandum identified the point of contact as "ILT Williams" at
"William.leonard@afghan.swa.army.mil," and was signed "Williams Leonard."
(R4, tab 179 at 1871)

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 53. RETC acknowledged receipt on 24 April 2012, but otherwise did not respond
to the cure notice (R4, tab 171at1667; tr. 1/100, 127, 3/121).

54. Mr. Jordan asked the government "ifRETC responded to the Cure Notice and
we provided the documentation requested in the Cure Notice, if we would have to
immediately start performing under all three suites again." The answer was yes. Then he
asked "if RETC does not respond to the Cure Notice, what would be the result of that."
He was informed that the government "would start preparing to terminate [RETC] from
the contract." (Tr. 3/58)

55. Mr. Jordan discussed it with the owners of RETC and together they
determined not to respond to the cure notice, reasoning as follows:

By answering the Cure Notice that would mean that I needed
to have fuel trucks available. I didn't have the funds, we
hadn't been paid, I didn't have the funds to continue. So I
couldn't hire a new Suite 1 subcontractor. If I addressed and
I answered the Cure Notice then I would have to continue on
dry and heavy and I didn't have the funds to pay them to
continue. We had already depleted all of our funds over a
year's time.

We couldn't come up with any other funding in any other
manner, so the only thing that I could do without putting
anymore US cargo in jeopardy of being lost, I did not respond
to the Cure Notice.

(Tr. 3/58-59) We infer that the reason RETC elected not to respond to the cure notice is
that it wished to be terminated. As noted above, for the remainder of its contract, RETC
reported zero assets available (finding 38).

56. Ms. Efstathia Fragogiannis took over as contracting officer in June 2012. She
determined to terminate RETC for cause. (Tr. 11122, 124-29)

57. On 15 September 2012, she issued to RETC a notice terminating the contract
for cause. The notice cited the following reasons: (1) previous letters of concern and
suspensions; (2) RETC's failure to comply with super lowboy requirements; (3) pilferage
of a government container while being transported by RETC and alleged forgery of the
TMR by an "unknown" person; (4) RETC 's request to report minimal assets due to
"excessive pilferage" of fuel; (5) RETC' s failure to achieve minimum acceptable quality

15
thresholds for certain requirements from September to December 2011; (6) RETC's
correspondence stating that it was canceling the contract~ (7) the accident that damaged a
government MRAP being transported by RETC; (8) RETC's submission of TMRs that
the government believed had been altered or forged; (9) RETC's failure to submit a
corrective action plan in response to the government's concerns; and (10) RETC's failure
to submit a response to the cure notice or to cure the underlying concerns. (R4, tab 246)

58. On 15 September 2012, the contracting officer executed contract Modification
No. POOO 10, terminating the contract for cause under FAR 52.212-4(m) (R4, tab 245).

IV. Claims and Appeals

59. On 12 November 2012, RETC submitted to this Board an appeal from the
contracting officer's decision to terminate the contract for cause. The appeal was
docketed as ASBCA No. 58383.

60. By letter dated 6 February 2013, RETC submitted a certified claim to the
contracting officer in the amount of$5,763,180 alleging that the government breached
the contract. RETC alleged that the government:

[B ]reached its duty of good faith, fair dealing and the duty to
cooperate and not interfere in RETC's performance by failing
to properly administer the contract, by failing to heed RETC' s
clarion calls for assistance, by failing to pay RETC as
required by the contract, and by failing to provide
commercially practicable contractual requirements and by
improperly terminating the contract for cause rather than for
convenience.

(Supp. R4, tab 356)

61. By 12 April 2013, no contracting officer's final decision regarding the claim
had been issued, and RETC filed a notice of appeal from a deemed denial of the claim.
The appeal was docketed as ASBCA No. 58619. On 14 April 2013, the contracting
officer issued a written final decision denying RETC's claim. (Supp. R4, tab 357) On
15 April 2013, RETC filed its notice of appeal of the contracting officer's final decision
to deny its breach of contract claim. The appeal was docketed as ASBCA No. 58620.
The appeals were consolidated (Bd. corr. !tr.