Raytheon Co. v. United States
104 Fed. Cl. 327
| Fed. Cl. | 2012Background
- Raytheon acquired Hughes Aircraft in 1997 and assumed sponsorship of two retirement plans with misdistributed funds, triggering IRS Voluntary Compliance Resolution to preserve plan tax status.
- Raytheon proposing $105.9 million of DOD costs under an Advance Agreement, with tentative government approval pending audit review.
- 2003 DCAA audit reduced allowable costs by $4.75 million; Raytheon reimbursed the Government per the Advance Agreement and the matter was closed.
- 2008 Inspector General criticism led to a second DCAA audit finding $25 million of costs unallowable; the December 2008 contracting officer final decision sought that amount from Raytheon, some of which Raytheon had already collected.
- Raytheon filed suit seeking a declaration that the 2008 final decision and the $25 million claim were time-barred under the Contract Disputes Act; the Government counterclaimed for breach of the Advance Agreement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When did the Government’s claim accrue for the CDA time bar | Raytheon argues accrual began in 1999 with the Advance Agreement | The Government argues accrual began in 2004 after the initial audit | Accrual occurred in 1999; later events did not reset accrual for the CDA period. |
| Whether the Accrual Suspension Doctrine applies | Raytheon argues no concealment or inherently unknowable injury occurred | Government asserts potential suspension due to undisclosed acts | Accrual suspension doctrine not applicable; insufficient concealment or inherently unknowable injury. |
| Whether the FAR Credits provision tolled or altered accrual | Raytheon denies a valid FAR Credits-based government claim | Government seeks tolling due to records access issues and the supposed credits | FAR Credits provisions do not toll accrual here; equitable tolling not shown. |
| Whether continuing claims doctrine applies to break the six-year limit | Costs were annual yet based on a single Advance Agreement event | Each annual claim is a separate event triggering continuing claims | Continuing claims doctrine does not apply; no separate, independent events. |
Key Cases Cited
- Frazer v. United States, 288 F.3d 1347 (Fed.Cir. 2002) (equitable tolling requires compelling justification for misconduct or concealment)
- Ingrum v. United States, 560 F.3d 1311 (Fed.Cir. 2009) (accrual suspension where injury was inherently unknowable or concealed)
- RAM Energy, Inc. v. United States, 94 Fed.Cl. 406 (Fed.Cl. 2010) (accrual-suspension principles within government claims)
- Brown Park Estates-Fairfield Dev. Co. v. United States, 127 F.3d 1449 (Fed.Cir. 1997) (continuing claims concept discussed in CDA context)