Did the Agency’s Exercise of Options in the IDIQ Contract Trickle Down to Options in the Task Orders?

The agency exercised options in an IDIQ contract. The contractor claimed the options in the IDIQ base contract trickled down to the options in task orders. Thus, the contractor reasoned, the agency had also exercised options under the task orders. The CBCA rejected the contractor’s argument. Nothing in the record stated that the exercise of options in the IDIQ contract also constituted the exercise of options in task orders.

True Excellence Group, LLC v. Department of Homeland Security, CBCA 7385

Background

True Excellence Group (TEG) had an IDIQ contract with FEMA to provide earthquake relief services. FEMA issued nine task orders under the IDIQ. FEMA exercised options under the IDIQ contract.

When the term of the IDIQ ended, FEMA asked TEG to submit final invoices. TEG invoiced FEMA for option periods under the task orders. FEMA refused to pay for option periods under the task orders. TEF submitted a claim. FEMA denied it. TEG appealed to the ASBCA.

Analysis

Mandatory Minimum

On appeal, TEG asserted the government had failed to order the mandatory minimum under the IDIQ contract. The board dismissed this theory because TEG had not submitted the mandatory minimum claim to the contracting officer.

Options

FEMA exercised options under the IDIQ contract. TEG attempted to recover for option periods under the task orders. TEG reasoned that the exercise of options at the IDIQ level had trickled down to the task order level.

The board, however, found that nothing in the record stated the exercise of option in the IDIQ automatically resulted in the exercise of options in the task orders. The board entered summary judgment for FEMA on this issue.

TEG is represented by John M. Manfredonia of Manfredonia Law Offices. The government is represented by Etka Patel and Bruce James of the Department of Homeland Security.

–Case summary by Craig LaChance, Senior Editor

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