CDM Constructors Inc. ( 2021 )

ARMED SERVICES BOARD OF CONTRACT APPEALS
Appeals of - )
)
CDM Constructors Inc. ) ASBCA Nos. 62026, 62088, 62089
)
Under Contract No. W912PL-12-C-0022 )
APPEARANCES FOR THE APPELLANT: Bret S. Wacker, Esq.
Emily J. Baldwin, Esq.
Jeffrey M. Gallant, Esq.
Clark Hill PLC
Detroit, MI
APPEARANCES FOR THE GOVERNMENT: Michael P. Goodman, Esq.
Engineer Chief Trial Attorney
John F. Bazan, Esq.
Gilbert H. Chong, Esq.
Brian M. Choc, Esq.
Engineer Trial Attorneys
U.S. Army Engineer District, Los Angeles
OPINION BY ADMINISTRATIVE JUDGE SWEET
On December 3, 2020, appellant CDM Constructors, Inc. (CDM) moved for
reconsideration (motion) of our decision on quantum in CDM Constructors, Inc.,
ASBCA No. 62026 et al., 20-1 BCA ¶ 37,721 (CDM II). In CDM Constructors, Inc.,
ASBCA No. 60454 et al., 18-1 BCA ¶ 37,190 at 181,013 (CDM I)—the entitlement
decision—we held that, even though the Army Corps of Engineers had constructively
changed the contract by imposing certain requirements related to evaporation ponds
(EPs), the government did not constructively change the contract when it required
CDM to include a standby EP. Moreover, as discussed in far greater detail in CDM II
(with which we presume the reader is familiar), we held in CDM II that CDM had
failed to prove quantum because it did not show that its revised 100 percent design—
which CDM sought to use as a baseline with which to compare the contractual
change—did not include a standby EP. Below, we find that the arguments CDM
brings to this motion for reconsideration have been waived, and thus are not
appropriate bases for reconsideration, because CDM did not raise those arguments in
the initial quantum appeal. In any event, those arguments are meritless. Therefore, we
deny the motion.
I. CDM Waived the Arguments that it Raises in its Motion, and Those
Arguments are not Appropriate Bases for Reconsideration
CDM waived the arguments that it raises in its motion, and thus those
arguments are not appropriate bases for reconsideration. Motions for reconsideration
are only appropriate if they are based upon newly discovered evidence, mistakes in the
findings of fact, or errors of law. Green Valley Co., ASBCA No. 61275, 18-1 BCA
¶ 37,044 at 180,330. “Motions for reconsideration do not afford litigants the
opportunity to take a ‘second bite at the apple’ or to advance arguments that properly
should have been presented in an earlier proceeding.” Dixon v. Shinseki, 741 F.3d
1367, 1378 (Fed. Cir. 2014) (citations and quotations omitted). As a result, in our
discretion, we may find that arguments not raised in an opening post-hearing brief
have been waived. Becton Dickinson & Co. v. C.R. Bard, Inc., 922 F.2d 792, 800
(Fed. Cir. 1990).
Here, while CDM’s motion for reconsideration is not entirely clear, we understand
CDM’s primary arguments 1 to be that: (1) the Board should not rely upon the water
balance analysis because it merely provided an estimate (mot. at 9-15); (2) we should
pro-rate CDM’s costs (id. at 28-30); (3) the relevant design did not need the purported
standby EP to prevent operational overflows (id. at 27-28); (4) the original operating
scenario did not use the purported standby EP to prevent operational overflows, and
merely diverted flow to the purported standby EP while cleaning an in-service EP (id.
at 30-33); (5) under res judicata or the law of the case doctrine, CDM I precludes a
finding that two months was a reasonable time to clean an EP (id. at 21-27); (6) the
testimony of CDM’s quantum EP expert (William B. O’Neil) established that the
alternative operating scenario showed that the relevant design included a standby EP (id.
at 18-21, 33-37); (7) CDM’s request for equitable adjustment (REA) did not concede that
the relevant design needed to use the purported standby EP to prevent operational
overflows (id. at 37-39); and (8) our qualifying the Corps’s quantum expert (Antonia
Ortiz) as an expert caused unfair surprise and undue prejudice (id. at 15-18). Because
CDM already had the opportunity to—and properly should have—advanced those
arguments earlier, CDM merely seeks a second bite at the apple. Therefore, CDM
waived those arguments, those arguments are not an appropriate bases for
reconsideration, and we deny the motion.
1 To the extent CDM raises other minor arguments, we find that it waived those
arguments, and they are meritless.
2
II. CDM’s Arguments are Meritless
In the alternative, we deny the motion because CDM’s arguments are meritless.
A. Water Balance Analysis
1. CDM’s Argument that the Board Should not Reply Upon the
Water Balance Analysis is Meritless
CDM’s argument that the Board should not rely upon the water balance analysis
because it merely provided an estimate is meritless (mot. at 9-15). As CDM II
properly held, while the water balance analysis is only an estimate, that analysis is a
relevant and reliable method for determining if a design includes a standby EP2—i.e.,
if it is necessary to use a purported standby EP for net evaporation to balance
inflows—because Ms. Ortiz, Mr. O’Neil, and CDM’s entitlement EP expert
(Dr. Beth Gross) all agreed that the determination of whether net evaporation balances
inflows should start with a water balance analysis (finding ¶ 6). Indeed, CDM’s
continued attempts to minimize the usefulness of the water balance analysis in
determining if net evaporation balances inflows is not persuasive in light of the fact
that its entitlement EP expert relied upon a water balance analysis for that precise
purpose (findings ¶¶ 6-8).
2. CDM’s Argument that the Board Should Pro-Rate Costs is
Meritless
CDM argues, in the alternative, that we should pro-rate its costs by 1.3 percent
to reflect the 1.3 percent increase in the required surface area and depth that CDM II
purportedly found the water balance analysis showed was needed in the relevant
design for net evaporation to balance inflows (mot. at 28-30). That argument assumes
that the deficiency that CDM II found in the relevant design was that it lacked
1.3 percent standby capacity. However, as we held in CDM I, the 0022 Contract did
not require standby capacity, but a standby EP. Thus, the problem with the fact that
the required surface area exceeded the available surface area at the maximum depth by
1.3 percent was not that that fact showed a 1.3 percent lack of standby capacity.
Rather, the problem with that fact was that it showed that the purported standby EP
was not a standby EP because the relevant design—which CDM made the litigation
decision to rely upon exclusively as its baseline on the assumption that it had a standby
EP—needed to use the purported standby EP to prevent operational overflows. As a
result, we cannot simply pro-rate costs to reflect a purported lack of standby capacity.
2 We continue to use terms as defined in CDM II. Further, all citations to “finding” are
to the findings of fact in CDM II.
3
In any event, it cannot be inferred from CDM II’s finding that the required
surface area was 1.3 percent greater than the available surface area at the maximum
depth that the required surface area and depth only would need to have been
1.3 percent larger in order for net evaporation to balance inflows. That inference
assumes that the water balance analysis would show that net evaporation would
balance inflows if the required surface area equaled the available surface area at the
maximum depth. However, under CDM II, the required surface area should have been
significantly less than the available surface at the maximum depth because the required
surface area is the average surface area needed for net evaporation to balance inflows,
but the EPs cannot continuously be operated at the maximum depth to provide that
average required surface area (finding ¶ 8). As a result, we cannot simply pro-rate
CDM’s costs by 1.3 percent to reflect the required surface area at the maximum depth.
B. CDM’s Model does not Support Finding that the Relevant Design
Included a Standby EP
1. CDMS’s Argument that the Relevant Design did not Need the
Purported Standby EP to Prevent Operational Overflows is Meritless
CDM’s argument that the relevant design did not need the purported standby
EP to prevent operational overflows is meritless (mot. at 27-28). CDM’s assertion that
it input inflow data into its model to determine the required water depth once operating
decisions were made is beside the point (mot. at 27-28). That assertion does not
change the fact that CDM failed in its attempt to use its model to establish that the
relevant design included a standby EP because it did not present any operating
scenario under which its model showed that the required water depth was less than the
available water depth without using the purported standby EP. On the contrary, the
Corps had to use the purported standby EP for more than the two months that it took to
clean the in-service EPs under both operating scenarios presented by CDM. Because
the two operating scenarios presented by CDM showed that the relevant design needed
the purported standby EP to prevent operational overflows, CDM failed to meet its
burden of showing that the relevant design included a standby EP. (Findings ¶¶ 9-11;
CDM II, 20-1 BCA ¶ 37,721 at 183,108-09).
2. CDM’s Argument that the Original Operating Scenario did not
use the Purported Standby EP to Prevent Operational Overflows,
and Merely Divert Flow to the Purported Standby EP While
Cleaning an In-Service EP is Meritless
CDM’s argument that the original operating scenario did not use the purported
standby EP to prevent operational overflows, and merely diverted flow to the
purported standby EP while cleaning an in-service EP is meritless (mot. at 30-33).
While CDM is correct that the original operating scenario did not show an operational
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overflow, it achieved that result by diverting flow to the purported standby EP every
12 months (finding ¶ 9). However, the only credible evidence about whether that
12 months was a reasonable length of time to clean the in-service EPs established that
that was an unreasonable amount of time because it reasonably only took 2 months to
clean an in-service EP (finding ¶ 3). Therefore, as Ms. Ortiz testified, the original
operating scenario went beyond merely diverting flow to the purported standby EP
while cleaning the in-service EPs, and instead used the purported standby EP to
prevent operational overflows (finding ¶ 9).
3. CDM’s Argument that, under the Res Judicata or the Law of the
Case Doctrines, CDM-I Precludes our Finding that two Months
was a Reasonable Time to Clean an EP is Meritless
CDM’s argument that, under the res judicata or the law of the case doctrines,
our decision on entitlement in CDM I precludes our finding that two months was a
reasonable time to clean an EP is meritless (mot. at 21-27). Under res judicata or the
law of the case doctrines, “[i]ssues decided in an entitlement proceeding cannot be
relitigated in a subsequent quantum appeal.” W.C. Fore Trucking, Inc., ASBCA
No. 40663, 93-2 BCA ¶ 25,703 at 127,864. In CDM I, we merely held that a standby
EP is an EP that is operational, but not in use unless or until there is an emergency.
CDM I, 18-1 BCA ¶ 37,190 at 181,008 n.12. CDM I did not address the issue of
whether diverting flow to a purported standby EP while cleaning an in-service EP
constituted “use;” let alone for how long such a diversion for cleaning could qualify as
non-use based upon the reasonable length of time it took to clean an in-service EP. Id.Indeed, in its reply brief, CDM concedes that its complaint is that CDM I “did
not find that the Contract included a limitation on the time a Standby EP could be put
in service” (app. reply br. at 7). Res judicata, of course, is inapplicable when a “prior
decision[] did not consider or decide [an] issue[]” Soledad Enterprises, Inc., ASBCA
No. 25826, 82-1 BCA ¶ 15,517; see also Steven E. Jawitz, ASBCA No. 33610, 87-3
BCA ¶ 20,011. Thus, because CDM I did not consider or decide the issue of what was
a reasonable length of time to divert flow to a standby EP while cleaning an in-service
EP, CDM I does not preclude CDM II’s finding that two months was a reasonable
length of time for such a diversion (finding ¶ 3).
4. CDM’s Argument that Mr. O’Neil’s Testimony Established that
the Alternative Operating Scenario Showed that the Relevant
Design Included a Standby EP is Meritless
CDM’s argument that Mr. O’Neil’s testimony established that the alternative
operating scenario showed that the relevant design included a standby EP is meritless
(mot. at 18-21, 33-37). CDM II properly gave little weight to Mr. O’Neil’s testimony
that the alternative operating scenario showed that the relevant design included a standby
5
EP for three reasons. First, CDM II properly gave little weight to Mr. O’Neil’s
alternative operating scenario testimony because there was an unexplained, large
discrepancy between the average required depth3 of over 60 inches under Mr. O’Neil’s
water balance analysis, and the average required depth of 20 inches4 under his alternative
operating scenario (finding ¶ 11). CDM argues that Mr. O’Neil’s water balance analysis
did not show that the average required depth was over 60 inches because 60 inches was
the maximum depth, and not the average required depth (mot. at 34). That argument
ignores the fact that the average required surface area in Mr. O’Neil’s water balance
analysis was greater than the surface area at the maximum depth, so the average required
surface area occurred at a depth greater than the 60 inch maximum depth. 5 Thus, the
required depth in Mr. O’Neil’s water balance analysis had to be greater than the 60 inch
maximum depth (findings ¶ 7 n.4, ¶ 11 n.6).
Second, CDM II properly gave little weight to Mr. O’Neil’s alternative
operating scenario testimony because CDM only supported that testimony with a
demonstrative exhibit, instead of with evidence (finding ¶ 11). While CDM is correct
that Mr. O’Neil offered to make tables of data available to the Corps during his
cross-examination, CDM mischaracterizes what occurred at the hearing when it states
that the Corps rejected that offer (mot. at 19 (citing tr. 3/45)). Instead, the Corps
correctly argued that it already had suffered prejudice from not having the tables
before it cross-examined Mr. O’Neil (tr. 3/45). In any event, independent of any
obligation to disclose information to the government, it was CDM’s burden to prove
quantum to the Board. B.R. Servs., Inc., ASBCA No. 47673 et al., 99-2 BCA ¶ 30,397at 150,272. The absence of any of the data regarding CDM’s model using the
alternative operating scenario prevented us from verifying the veracity of Mr. O’Neil’s
alternative operating scenario testimony, and thus undermines the weight to which that
opinion is entitled.
Third, CDM II properly gave little weight to Mr. O’Neil’s alternative operating
scenario testimony because the supporting demonstrative exhibit showed that the
purported standby EP needed to be used for more than the two months a year while
3 CDM quibbles over the term “required depth,” incorrectly suggesting that CDM II
found that the 0022 Contract required a particular depth (mot. at 32-34; app.
reply br. at 9). However, CDM II clearly defined the term “required depth” as
the depth an analysis or model concluded a design’s EPs—and not the
0022 Contract—required for net evaporation to balance inflows (finding ¶ 9).
4 CDM mischaracterizes CDM II as holding that the “‘required depth’ of the EPs
[under the alternative operating scenario] was 40 inches” (mot. at 33). In fact,
CDM II held that, while “the required depth did not exceed about 40 inches”
(finding ¶ 10 (emphasis added)), it averaged 20 inches (finding ¶ 11).
5 The relevant design EPs contained set dimensions, so they would have a particular
surface area at a particular depth (R4, tab 1057 at 2,947).
6
cleaning the in-service EPs (finding ¶ 11). In support of its motion, CDM submits a
new exhibit that adds annotations to the graph in the demonstrative exhibit. Those
annotations assert that the two months the purported standby EP was in service each
year were June and July. (Mot., ex. B) However, even if CDM had not waived the
annotations by failing to include them in the demonstrative earlier (which is not the
case), there is no evidence or testimony—let alone expert testimony—supporting those
annotations (mot. at 36-37). Indeed, we cannot even verify the annotations against the
demonstrative graph because that graph only shows years, and not months. Without
an indication of months, we are left to estimate from the graph how many months a
year the purported standby EP was in service (trial ex. 5). As best as we can determine
under those limitations created by CDM, the purported standby EP was in service for
more than two months a year under the alternative operating scenario (finding ¶ 11).
5. CDM’s Argument that its Request for an Equitable Adjustment did
not Concede that the Relevant Design Needed to use the Purported
Standby EP to Prevent Operational Overflow is Meritless
CDM’s argument that its REA did not concede that the relevant design needed to
use the purported standby EP to prevent operational overflows (mot. at 37-39) is
meritless because the REA failed to use the infinity symbol (∞) for the relevant design
EP standby period, and CDM acknowledged that an infinity symbol represented a
standby EP that was not used to prevent operational overflows (finding ¶ 15). CDM
does not dispute that the REA failed to use the infinity symbol for the relevant design EP
standby period. Rather, it argues that it did not acknowledge that an infinity symbol
represented a standby EP that was not necessary to prevent operational overflows (mot.
at 37-39). However, in the REA, CDM stated that “the Corps directed that the ‘standby’
pond could not be used for any operational overflow, and that its standby period is
considered to be ‘infinity’” (R4, tab 4 at 36). While CDM’s REA disputed the
government’s position that a standby EP could not be used to prevent operational
overflows, it did not dispute that an infinite standby period referred to an EP that was not
used to prevent operational overflows (id.). On the contrary, the fact that CDM proceeds
to use the infinity symbol in REA attachment C’s standby period column without
proffering any alternative definition of the term infinity, leaves the only definition of
infinity that CDM reasonably could have meant as the one referred to earlier in the
REA—namely an EP that was not used to prevent operational overflows (id. at 36, 109).
Indeed, the fact that CDM used the infinity symbol in attachment C to represent the
standby period “Per GOV Direction” demonstrates that CDM acknowledged that the
infinity symbol—as used in attachment C—had the “Corps-directed” meaning of an EP
that was not used to prevent operational overflows (id.).
In any event, CDM ignores the more important point that, by indicating in
attachment C that the relevant design only had a standby period of 12 months while
the government direction was to provide an infinite standby period, CDM
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acknowledged that the relevant design did not meet the government direction that the
standby EP could not be used to prevent operational overflows (id. at 109). That
acknowledgement, in turn, effectively means that the REA conceded that the relevant
design did not satisfy CDM I’s definition of a standby EP because CDM I adopted the
government directed definition of a standby EP as an EP that was not necessary to
prevent operational overflows. CDM I, 18-1 BCA ¶ 37,190 at 181,012-13.
C. CDM’s Argument that our Qualifying Ms. Ortiz as an Expert Caused
Unfair Surprise and Undue Prejudice is Meritless
CDM again mischaracterizes what occurred at the hearing when it argues that
our qualifying Ms. Ortiz as an expert after we purportedly rejected her as an expert and
CDM presented its case-in-chief caused unfair surprise or undue prejudice (mot.
at 15-18). While CDM is correct that we ruled at the beginning of the hearing that
Ms. Ortiz did not qualify as an expert in EPs (tr. 1/9-13), it neglects to mention that we
also ruled prior to CDM’s case-in-chief that the Corps could voir dire Ms. Ortiz after
CDM’s case-in-chief to establish that Ms. Ortiz qualified as an expert in the sizing of
ponds for outflows to balance inflows more generally (tr. 1/17-18).6 Therefore, our
qualifying Ms. Ortiz as an expert in pond sizing after the voir dire that we had
informed the parties we would allow the Corps to conduct after CDM’s case-in-chief
did not cause unfair surprise. Moreover, CDM did not suffer undue prejudice because
CDM had ample opportunity to cross-examine Ms. Ortiz, and to respond to her
testimony during rebuttal (tr. 2/208-64, 3/12-43).
Also meritless is CDM’s argument that it was prejudiced by the fact that
Ms. Ortiz’s expert reports did not indicate that two months was a reasonable time to
divert flow to a standby EP while cleaning an in-service EP (mot. at 16-17). While
Ms. Ortiz’s expert reports did not specifically refer to two months (tr. 3/28), her
rebuttal report clearly opined that the relevant design went beyond diverting flow to
the purported standby EP while cleaning an in-service EP, and instead used the
purported standby EP to prevent operational overflow (R4, tab 1000 at 3-4). If CDM
was unclear about the specific reasons why Ms. Ortiz thought that the relevant design
went beyond diverting flow to the purported standby EP while cleaning an in-service
EP—i.e., because the relevant design used the purported standby EP for more than the
two months that it reasonably took to clean an in-service EP—it could have questioned
Ms. Ortiz about that issue at her deposition. In any event, CDM suffered no prejudice
because it had the opportunity to cross-examine Ms. Ortiz and present rebuttal
evidence regarding Ms. Ortiz’s opinion that two months was a reasonable time to
divert flow to a standby EP while cleaning an in-service EP. Yet it failed to impeach
6 CDM did not preserve its argument that qualifying Ms. Ortiz as an expert caused unfair
surprise or undue prejudice by raising that objection at voir dire (tr. 1/18-20).
8
Ms. Ortiz’s testimony or to present any contrary evidence on that issue. (Tr. 2/208-64,
3/12-43)
CONCLUSION
For the reasons discussed above, CDM’s motion for reconsideration is denied.
Dated: April 7, 2021
JAMES R. SWEET
Administrative Judge
Armed Services Board
of Contract Appeals
I concur I concur
RICHARD SHACKLEFORD J. REID PROUTY
Administrative Judge Administrative Judge
Acting Chairman Vice Chairman
Armed Services Board Armed Services Board
of Contract Appeals of Contract Appeals
I certify that the foregoing is a true copy of the Opinion and Decision of the
Armed Services Board of Contract Appeals in ASBCA Nos. 62026, 62088, 62089
Appeals of CDM Constructors Inc., rendered in conformance with the Board’s Charter.
Dated: April 8, 2021
PAULLA K. GATES-LEWIS
Recorder, Armed Services
Board of Contract Appeals
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