63663

CACI International Inc.

May 6, 2025Judge D'Alessandris
Partially SustainedCost Allowability / Allocability (FAR 31)Indirect Rates / Incurred CostCost Accounting Standards (CAS)Quantum / DamagesContract InterpretationAccord & Satisfaction / Release / WaiverStatute of Limitations / TimelinessStatutory CompliancePayment / Progress Payments / FinancingTermination for ConvenienceDCAA InvolvedDCMA InvolvedCAS at Issue

CACI International Inc. challenged the disallowance of Iraqi prisoner-litigation legal costs included in indirect cost submissions and penalties for excess executive compensation costs. The Board held that the 2007 settlement agreement did not bind the Department of Defense, denied summary judgment on legal-cost allowability, statute of limitations, and penalties, and granted summary judgment concerning the improper inclusion of non-flexibly priced contracts in the calculations.

Material Facts

  • CACI Premier Technology performed interrogation services at Abu Ghraib prison under Department of the Interior task orders between 2003 and 2004.
  • The Department of the Interior terminated the task orders for convenience so the work could be replaced by Department of Defense contract vehicles.
  • The 2007 settlement agreement was between CACI Premier Technology and the Department of the Interior and addressed claims arising out of the terminated task orders.
  • The Al Shimari litigation costs were incurred in defending civil litigation brought by Iraqi prisoners in the Eastern District of Virginia.
  • CACI included Iraqi prisoner-litigation expenses in incurred cost submissions and allocated the costs through its home office overhead pool.
  • DCAA audited CACI's fiscal year 2006 incurred cost submission and reported CAS 403 noncompliance concerning the allocation of Iraq legal defense costs.
  • The 2012 settlement agreement concerning the CAS 403 appeal did not address or determine the reasonableness or allowability of CACI's Iraq legal costs.
  • The DCAA audit reports for fiscal years 2013 through 2017 did not address or question the allowability of legal costs.
  • CACI and DCMA executed tolling agreements concerning the statute of limitations for the incurred cost submissions.
  • CACI voluntarily disclosed that it had omitted certain executive-compensation bonus costs from its fiscal year 2017 blended compensation-cap calculation and submitted revised calculations.
  • The advance agreement required CACI to submit a detailed schedule showing that the blended rates would not result in pricing total compensation to the government above the applicable limits.
  • The parties agreed that the final decision improperly included non-flexibly priced contracts in calculating the unallowable costs and penalty amounts.

Parties

Appellant
CACI International Inc.
Respondent Agency
Department of Defense
Contracting Agency
Department of the Interior
Contract Number
N00189-12-D-Z001
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