Custom Printing Co. v. United States

51 Fed. Cl. 729, 2002 U.S. Claims LEXIS 41, 2002 WL 384324
CourtUnited States Court of Federal Claims
DecidedFebruary 15, 2002
DocketNo. 99-265C
StatusPublished
Cited by14 cases

This text of 51 Fed. Cl. 729 (Custom Printing Co. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Custom Printing Co. v. United States, 51 Fed. Cl. 729, 2002 U.S. Claims LEXIS 41, 2002 WL 384324 (uscfc 2002).

Opinion

OPINION

YOCK, Senior Judge.

On April 30, 1999, the plaintiff, Custom Printing Company (“Custom Printing”), filed a Complaint against the United States (the “defendant”), alleging breach of contract and promissory estoppel. On September 15, 1999, Custom Printing voluntarily dismissed its promissory estoppel claim, Count II of the Complaint. This matter is now before this Court on the parties’ cross-motions for summary judgment. For the reasons set forth herein, the defendant’s Motion for Summary Judgment is GRANTED, and the plaintiffs Motion for Summary Judgment is DENIED.

Background

In early 1998, the Government Printing Office (“GPO”) sent out an invitation for bids (“IFB”) for Program C271-S, which involved the procurement of the U.S. Terminal Procedures Publication (twenty loose-leaf and twenty perfect-bound volumes), Alaska Terminal Procedures Publication (one bound volume), and changes therein, as requisitioned by the National Oceanic and Atmospheric Administration (“NOAA”).1 The Program C271-S IFB was sent to thirty-seven contractors; in reply, the GPO received ten no bids and two responsive bids, made by Custom Printing and Fry Communications, Inc. (“Fry Communications”), respectively.

Section 3 (“Determination of Award”) of the Program C271-S IFB provided that “[t]he Government will determine the lowest bid by applying the prices offered in the ‘Schedule of Prices’ to the following units of production which are the estimated requirements to produce [one year’s production] under this contract.” Def.’s Mot. for Summ. J.App. at 5, 39. Using the estimated units of production listed in the Determination of Awards, the total gross contract bid prices for Custom Printing and Fry Communications were $2,472,216.88 and $2,591,251.76, respectively. Thus, under the terms of the original Determination of Awards contained in the Program C271-S IFB, Custom Printing offered the lowest bid by a difference of $119,034.88. On June 10,1998, in accordance with the contracting officer’s recommendation, the GPO awarded the contract for Program C271-S (the “Contract”) to Custom Printing. The term of the Contract was “for the period beginning Date of Award and ending February 28, 2003.” Id. App. at 6.

The Program C271-S IFB, however, contained a serious underestimate of the number of strip-ins to be required annually under the Contract. A “strip-in” is a line on a page that identifies the volume number, page number, and effective date of the page. While nearly every page of the U.S. Terminal Procedures publication and the Alaska Terminal Procedures publication required a strip-in, the Program C271-S IFB contained the erroneous estimate that only 108 strip-ins would be needed per year.2 In reality, the number of strip-ins required was approximately 65,-000 per year.3 Based on Custom Printing’s original bid price of $12 per strip-in, its total estimated price for strip-ins was $1,296 per year. Using the corrected number of strip-ins, Custom Printing’s revised bid price for strip-ins would amount to approximately $780,000 per year. In contrast, Fry Communications had offered an original bid price of $0.20 per strip-in, with a total estimated [731]*731price for strip-ins of $21.60 per year. Using the corrected number of strip-ins, Fry Communications’ revised bid price for strip-ins would be approximately $13,000 per year. Assuming that all else was equal, a change in the annual number of strip-ins required under the Contract would have increased Custom Printing’s estimated total bid price to $3,250,920.88 per year; while Fry Communications’ estimated total bid price would have increased to only $2,604,230.16 per year. Thus, under the corrected requirements of the Program C271-S IFB, Fry Communications might have been awarded the Contract as the contractor with the lowest bid.4

In approximately December 1998, the GPO’s contracting officer, Mr. Jack Scott, informed Custom Printing that its invoiced charge for strip-ins was too high and requested that Custom Printing lower its price for that line item. The GPO and Custom Printing, however, were unable to reach an agreement as to a revised price for strip-ins. See Def.’s Mot. for Summ. J.App. at 48-50 (Deposition of John R. Scott, Contracting Officer). See also Def.’s Opp’n to Pl.’s Mot. for Summ. J. & Reply to Pl.’s Opp’n to Def.’s Mot. for Summ. J.App. at 1-2 (Deposition of Roñal Cooper, Director of Marketing, Custom Printing).

Section A of the Contract, entitled “General Terms and Conditions,” explicitly provided that the Contract was subject to “the applicable provisions, clauses, and supplemental specifications of GPO Contract Terms (GPO Pub. 310.2, effective December 1, 1987 (Rev.9-88)) * * Def.’s Mot. for Summ. J.App. at 7. Section 19 of the GPO Contract Terms (GPO Pub. 310.2), entitled “Termination for the Convenience of the Government,” allows the GPO to terminate a contract for the convenience of the Government. Section 19 states, in pertinent part:

The Government may terminate performance of work in whole or in part if the Contracting Officer determines that a termination is in the Government’s interest.

GPO Contract Terms § 19(a) (GPO Pub. 310.2) (Dec.1987 (Rev.9-88)).

On February 1, 1999, the contracting officer submitted a memorandum to the GPO Contract Review Board requesting “[cjoncurrence * * * to terminate the contract for the convenience of the Government and readvertise with revised specifications.” Def.’s Mot. for Summ. J.App. at 56. The contracting officer provided the following basis for his request to terminate the Contract:

The Determination of Award figure for strip-ins (line item I.(e)) was incorrectly figured at 108, when actually the figure should have been figured at 65,000. The previous contractor, Fry Communications, Inc., did not charge for this line item during the previous contract periods, therefore, the Agency did not take the number of strip-ins into consideration when determining the basis of award figure for this line item. Custom Printings’ cost for strip-in is $12.00 per strip-in which works out to approximately $120,000.00 per printing/binding order or $780,000.00 per contract period, for this strip-in charge. After the error was discovered, the Government was unsuccessful in attempting to negotiate a fair and reasonable price for strip-ins with Custom Printing Co. NOTE: Fry Communications, Inc. bid price for this line [732]*732item was $.20 per strip-in. In addition, the Department of Commerce (NOAA), wants to add an additional color to the charts, which is not covered in the current specifications.
If the correct line item figure for strip-ins was used in the determination of award, Custom Printing Co. would not have been the low bidder on program C271-S. The Department of Commerce (NOAA) did not allocate the additional funds for the unexpected increase in costs, nor do they have the appropriate funds to continue this contract at current contract prices.

Id.

On February 1, 1999, the GPO Contract Review Board concurred in the contracting officer’s recommendation that the Contract should be terminated for the convenience of the Government. Accordingly, on February 2, 1999, the contracting officer served upon Custom Printing a notice of termination for the convenience of the Government.

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Bluebook (online)
51 Fed. Cl. 729, 2002 U.S. Claims LEXIS 41, 2002 WL 384324, Counsel Stack Legal Research, https://law.counselstack.com/opinion/custom-printing-co-v-united-states-uscfc-2002.