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USAC Aerospace Group Inc. dba USAC Aerospace Group: Ordnance Division
ASBCA No. 59186
| A.S.B.C.A. | Mar 16, 2017
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Background

  • DLA awarded contract SPM4A6-11-C-0135 to "USAC Aerospace Group: Ordnance Division" on 23 May 2011 for guided missile launcher tripod mounts; contract incorporated FAR clauses including CCR/SAM registration requirements and default remedy.
  • Government evidence (state records and SAM/CCR entries) suggested USAC had lost or had revoked corporate status in California (2008) and Nevada (revocation noted 30 Apr 2011), and that multiple CAGE codes and registration inconsistencies existed.
  • DLA terminated the contract for default on 6 Dec 2013 for failure to deliver the first article; USAC appealed on 28 Feb 2014, NOA signed by Michael Sammon as Director of Operations.
  • Government moved to dismiss for lack of jurisdiction, arguing the contract was a nullity because USAC lacked corporate capacity to contract.
  • The Board, sua sponte, raised additional concerns under Board Rule 15 about whether USAC was a legally incorporated entity at award and whether Sammon had authority to represent the corporation; it ordered USAC to prove incorporation and representative authority but received inadequate responses.
  • Because USAC failed to produce credible documentation of corporate existence or Sammon’s authority, the Board drew adverse inferences and dismissed the appeal without prejudice for lack of a proper corporate representative.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Corporate capacity to contract USAC did not meaningfully contest capacity in filings; focused on merits. DLA: USAC was defunct/ not incorporated at award, so contract is a nullity and Board lacks jurisdiction. Board did not resolve motion on merits but found capacity doubts and requested proof; adverse inference drawn for lack of proof.
Duty to disclose SAM/CCR registration accuracy (not asserted) DLA: Contractor must keep CCR/SAM accurate; inconsistencies support lack of capacity. SAM/CCR entries were considered probative of irregular corporate status but Board relied on failure to rebut.
Authority of corporate representative (Board Rule 15) Sammon signed NOA as Director of Operations; USAC offered only uncertified assertions of authority. DLA challenged Sammon’s authority given corporate suspension/revocation. Board required proof of representative authority; absent proof, drew adverse inference that Sammon lacked authority.
Procedural consequence / remedy USAC sought to pursue appeal (merits of termination). DLA sought dismissal for lack of jurisdiction due to null contract and lack of capacity; cited precedent requiring dismissal where corporation suspended. Board dismissed appeal without prejudice because it could not proceed without a properly authorized corporate representative.

Key Cases Cited

  • In re Krause, 546 F.3d 1070 (9th Cir. 2008) (discusses standing and consequences of corporate default or suspension)
  • AA Primo Builders, LLC v. Washington, 126 Nev. 578 (Nev. 2010) (Nevada law on corporate standing and revival following forfeiture)
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Case Details

Case Name: USAC Aerospace Group Inc. dba USAC Aerospace Group: Ordnance Division
Court Name: Armed Services Board of Contract Appeals
Date Published: Mar 16, 2017
Docket Number: ASBCA No. 59186
Court Abbreviation: A.S.B.C.A.