Background - About (Leadership)

Case Studies

Client:
SUFI

Team:
Retired Partner Rick Claybrook.
Partner Brian Tully McLaughlin.

What Our Clients Say:
"I attended every day of the five-week trial. Crowell & Moring's attorneys not only worked hard, but were terrific both in and out of the courtroom. What we formed was not an 'attorney-client relationship,' but a true, caring friendship."

- Steve Myers, Jr.
Managing Director, SUFI

Standing up for the little guy (and winning big)

Challenge:
Help SUFI, a small telephone company, inexperienced in government contracts, go up against the Air Force in a contract dispute. The Air Force asked SUFI to build a telecommunications system for overseas military bases under a no-cost contract, with the incentive of becoming the exclusive provider of long-distance services from the TDY lodgings. But once the system was built and installed, the Air Force breached the contract in multiple ways, effectively forcing SUFI off base.

Solution:
We started by seeking a declaration at the Armed Service Board of Contract Appeals that SUFI could cancel its contract halfway through its performance. The ASBCA found exactly that, holding that the Air Force was in material breach—one of the few times ever this has been allowed. We then helped SUFI negotiate the sale of its telephone systems to the Air Force and began to prepare SUFI's monetary claims due to the Air Force's many breaches, including lost profits.

Result:
Through a series of record-making decisions and court rulings that produced more than 20 published decisions, Crowell & Moring ultimately recovered more than $200 million for SUFI. The effort began with prosecuting 28 claims for SUFI in a five-week trial in the U.S. and Germany. The ASBCA ruled in SUFI's favor in 22 of those claims, awarding a record-making $3.5 million (without interest). We then successfully prosecuted three motions for reconsideration—another record. The net result: ASBCA increased SUFI's award to over $7 million (over $10 million with interest). We then appealed the ASBCA's decision denying or limiting the damages awarded on certain claims to the Court of Federal Claims, which awarded it over $100 million additional, plus interest. On appeal by the government, the Federal Circuit similarly found fault with most of the ASBCA's damages determinations but held that the court was not permitted to recalculate them itself, remanding back to the Board to correct its errors and award additional damages. On remand, following the guidance and instructions of the CFC and Federal Circuit, the ASBCA awarded SUFI an additional $113 million, plus interest, while denying the Air Force's motion for reconsideration. The government sought review of the ASBCA’s award before the CFC, but its challenge was rejected on the basis that the U.S. Department of Justice has no independent right to complain of an award accepted by the contractor. The government then appealed to the Federal Circuit, which affirmed the CFC’s dismissal of DOJ’s challenge and found DOJ’s assertions that the ASBCA failed to comply with the Federal Circuit’s mandate to be meritless. The CFC then granted SUFI’s petition for attorney’s fees at its current rates on account of Crowell & Moring’s expertise and exceptional success in the litigation, as well as the extensive delay in payment, awarding SUFI more than $9 million in litigation fees while making findings of bad faith against the Air Force and DOJ.

The CFC stated, “If ever there were a set of facts supporting a finding that government contracts expertise was essential to a litigation, this is it.”

In addition to recovering critical damages for our client, we set several records throughout the course of the litigation, including the largest judgment on a no-cost contract or non-appropriated fund instrumentality contract, the most successful reconsiderations in any type of case at the ASBCA, the largest attorney fee award in a government contracts case, and the first government contracts case to win Equal Access to Justice Act special factors enhancements.