Pension & Benefits News Satisfying Minimum Order Requirements Did Not Preclude Claims
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Tuesday, April 14, 2020

Satisfying Minimum Order Requirements Did Not Preclude Claims

By Pension and Benefits Editorial Staff

A motion to dismiss breach claims was denied because the government’s contention it had no obligation to place additional orders after satisfying the contracts’ express minimum order provisions lacked merit and the Court of Federal Claims concluded the claims were facially plausible. The contractor alleged the government breached the terms of two indefinite-delivery, indefinite-quantity Afghanistan trucking contracts by assigning the contractor less than an average, pro rata allocation of missions. The contracts obligated the government to guarantee orders worth at least $1,000 under one contract and $2,500 under the second contract. Moving to dismiss for failure to state a claim, the government contended it was not obligated to place orders exceeding the minimums.

Separate and Independent Contractual Obligations. However, the contractor alleged the government had an implied duty under one contract and an express duty under the other contract to assign transportation movement requests on the basis of an order of merit list process specified in a predecessor contract. The minimum order requirements and the alleged implied and express requirements that the government assign missions pursuant to the OML process were separate and independent contractual obligations. No authority suggested that, once the government had met an IDIQ contract’s minimum quantity requirement, it could ignore independent contractual requirements intended to ensure fairness in the assignment of task orders among multiple contractors. The contractor also stated claims the government violated the implied duty of fair dealing in failing to award the contractor the share of TMRs required under the OML process and deciding not to exercise an option. (Vanquish Worldwide, LLC v. U.S., FedCl, 64 CCF ¶81,869)

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