Construction Law Insights

Abacus Tech. Corp. v. Sci. Applications Int’l Corp., 2022 Va. Cir. LEXIS 27 (Cir. Ct. Fairfax Cnty. Apr. 6, 2022)

Science Applications International Corporation (“SAIC”), a primary government contractor, subcontracted with Abacus Technology Corp. (“Abacus”) for Abacus to help SAIC with its work for NASA under SAIC’s government contract with the agency. SAIC terminated the subcontract and Abacus alleged $450,775.09 in damages for breach of contract for nonpayment of Abacus’ full indirect cost reimbursement adjustment to its 2018 invoice. Abacus alleged its subcontract with SAIC was a cost-plus-award-fee contract, i.e. Abacus would be paid its costs of performance in addition to a calculated award fee. Abacus’ indirect costs (“G&A Expenses”) were subject to after-action government audit, which occurred and adjusted the G&A Expense rate upward for Abacus. Abacus alleged that SAIC refused to reimburse Abacus for its G&A Expenses. SAIC alleged that Abacus is to blame for a cost overrun where Abacus exceeded the maximum funding allowed under a cost-reimbursement subcontract and failed to provide timely notice to SAIC of the overrun. At issue was how much Virginia’s summary judgment procedure was expanded when the 2019 Virginia General Assembly revised Virginia’s summary judgment procedures to permit certain business litigants to use affidavits and depositions to support their summary judgment motions. Va. Code § 8.01-420(C).

The Court denied Abacus’ Motion for Partial Summary Judgment and held that the 2019 amendment did not morph Virginia summary judgment procedure into its federal court analogue and the amendment only slightly liberalized civil procedure to permit the use of affidavits and depositions to support summary judgment motions. Abacus argued, due to the 2019 amendment, that once Abacus filed its Motion for Summary Judgment and offered its declaration, SAIC’s failure to file responsive affidavits, offer contrary deposition testimony, or otherwise put on evidence negated any general denials of Abacus’ claim in pleadings. While the 2019 amendment allows a party to use depositions and affidavits to support or oppose a motion for summary judgment, Virginia does not have an analogous requirement to Federal Rules of Civil Procedure Rule 56(c)(1), which requires a party to support or defend a factual assertion in a motion for summary judgment and failure to do so may lead a court to deem the non-presented fact undisputed for purposes of the motion. The General Assembly also knew that the Supreme Court of Virginia directly held that a party has no duty to develop a factual record in time for an opposing party’s summary judgment motion. Abacus needed deposition testimony or affidavits from SAIC rebutting SAIC’s pleaded claims, not from Abacus itself, or Abacus needed other evidence showing that SAIC did not really dispute Abacus’ claims despite SAIC’s denials in the pleadings. However, Abacus had neither. Ultimately, the Court found there were material facts in dispute, which the Court gleaned from the pleadings.

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