Cost Allowability and Statute of Limitations

Raytheon Company
2007 - 2012

On a Government Motion for Reconsideration, our attorneys successfully represented Raytheon Company in a government claim regarding the allowability of more than US$25M of Voluntary Compliance Resolution costs incurred to preserve the tax status of a defined benefit pension plan. In a seminal case, the Court of Federal Claims ruled that the Contract Disputes Act Statute of Limitations barred the Government’s claim.  The Court specifically held that a DCAA audit report does not postpone accrual of a government claim.  The case also states the standard for reconsideration.  Regarding the statute of limitations, the court further held that “[h]aving ruled that the court lacked jurisdiction to hear the contacting officer’s decision in the form of a counterclaim because the statute of limitations had run, we could not consider issues raised by later pleadings of either party.”

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