Kellogg Brown & Root Services, Inc.

Material Facts

• The Army awarded KBR the LOGCAP III contract to provide selected support services for Army operations worldwide.
• The LOGCAP III contract was a cost-plus-award-fee, indefinite-delivery, indefinite-quantity contract.
• The contract incorporated FAR 52.216-7, Allowable Cost and Payment.
• The Army issued four task orders to KBR to operate dining facilities in Kuwait and Iraq.
• KBR awarded eleven subcontracts to Eurest Support Services Worldwide for dining-facility services, and KBR alleged that the subcontracts were firm, fixed-price subcontracts.
• KBR's first appeal concerned private security costs incurred by the ESS dining-facilities subcontractor.
• KBR's second appeal concerned indirect private security costs associated with KBR personnel in the Middle East.
• DCAA issued a Form 1 suspending private armed security costs relating to the eleven ESS subcontracts.
• DCAA later issued a Revised Form 1 disapproving private security costs associated with five task orders.
• The government filed a False Claims Act suit alleging that KBR and its subcontractors used private armed security without required authorization and presented claims containing prohibited security costs.
• The False Claims Act suit encompassed allegations involving more than 30 subcontractors, while ASBCA No. 56358 was confined to costs attributable to ESS.
• ASBCA No. 56358 was filed two years before the district-court action, and the parties had engaged in discovery before the stay motions.

Parties

Appellant

Kellogg Brown & Root Services, Inc.

Respondent Agency

Army

Contracting Agency

Army

Contract Number

DAAA09-02-D-0007