Lockheed Martin Aeronautics Co. v. Secretary of the Air Force, No. 22-1035 (Fed. Cir. 2023)
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For pressing projects, the government can issue “Undefinitized Contract Actions” (UCAs) to allow contractors to begin work before the parties have reached a final agreement on contract terms, like price. The Air Force entered into two UCAs with Lockheed for upgrades to F-16 aircraft. Both UCAs include “definitization” clauses that provide that if the parties are unable to reach agreements on price by a certain time, the Contracting Officer (CO) may determine a reasonable price. After years of negotiations, the Air Force and Lockheed were unable to agree on the price terms. The CO assigned to each UCA unilaterally definitized a price of about $1 billion.
The Armed Services Board of Contract Appeals (ASBCA), acting under the Contract Disputes Act (CDA), dismissed appeals for lack of jurisdiction because Lockheed failed to submit a certified contractor claim to the COs requesting a final decision on its claims as required under the CDA. The Federal Circuit affirmed, rejecting Lockheed’s argument that the COs’ unilateral definitizations qualified as government claims under the CDA, which a contractor can directly appeal to the ASBCA without having to submit its own claim to the COs. The COs’ definitizations of the contract prices were not demands or assertions by the government seeking relief against Lockheed.
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