5753058161

Kellogg Brown & Root Services, Inc.

February 20, 2013Judge Delman
DismissedCost Allowability / Allocability (FAR 31)Equitable Adjustment (REA)DCAA InvolvedDCMA Involved

Kellogg Brown & Root Services, Inc. appealed the government's disallowance of subcontract settlement costs arising from two Requests for Equitable Adjustment. The Board granted the government's motion and dismissed the appeals without prejudice because parallel False Claims Act litigation involved substantially similar facts, issues, and witnesses.

Material Facts

  • KBR billed the government for subcontract settlement costs arising from its settlement of two REAs submitted by First Kuwaiti.
  • The same REAs underlying the Board appeals were alleged to be false in the government's False Claims Act action.
  • The settlement costs were originally paid by the government.
  • DCAA disapproved the settlement costs.
  • A contracting officer issued an interim determination allowing approximately half of the settlement amount, and a later contracting officer overruled that determination.
  • KBR's certified claim sought recovery of all settlement costs plus interest.
  • The United States filed a federal district court action against KBR and First Kuwaiti alleging that the REAs and related settlement costs were knowingly inflated and false.
  • KBR and First Kuwaiti were parties to the federal action, enabling the parties to develop a full record regarding how the REAs were prepared, submitted, and settled.

Parties

Appellant
Kellogg Brown & Root Services, Inc.
Contract Number
DAAA09-02-D-0007
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