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Sabre International Security v. Torres Advanced Enterprise Solutions

April 30, 2012

SABRE INTERNATIONAL SECURITY PLAINTIFF,
v.
TORRES ADVANCED ENTERPRISE SOLUTIONS, INC.,
DEFENDANT.



The opinion of the court was delivered by: Gladys Kessler United States District Judge

MEMORANDUM OPINION

Plaintiff, Sabre International Security ("Sabre"), a private Iraqi security company, brings this action against Defendant, Torres Advanced Enterprise Solutions, Inc. ("Torres"), a Virginia limited liability company, for breach of contract, breach of fiduciary and trust obligations, unjust enrichment, and tortious interference with prospective economic advantage and business relations. This matter is presently before the Court on Sabre's Motion to Dismiss Torres' Counterclaims("Sabre's Motion to Dismiss") (December 20, 2011). Upon consideration of the Motion, Opposition, Reply, and the entire record herein, and for the reasons set forth below, Sabre's Motion is granted in part and denied in part.

I. Background

A. Factual Backgound

Sabre is a private security contractor providing security services around the world to various entities, including the U.S. Government. Complaint ("Compl.") ¶ 1. On September 27, 2007, Sabre won one of several U.S. Government Theater-wide Internal Security Services Multiple Task Order Contracts, number W91GDW-07-D-4026 ("TWISS I Contract"), to provide security services to U.S. military installations in Iraq. Id. ¶ 6. On November 8, 2007, in connection with this Contract, Sabre entered into a subcontractor agreement with Torres ("2007 Subcontractor Agreement"). Id. ¶ 7. Pursuant to this Agreement, Torres agreed to provide personnel holding valid U.S. Government security clearances to work on Sabre's TWISS I projects. Id.

In 2009, the U.S. Government amended its policies for TWISS I contracts by requiring that prime contractors, like Sabre, possess a U.S. Defense Department Industrial Security Program Facility Security Clearance at the Secret Level ("Secret FCL"). Id. ¶ 11. Sabre, as a non-U.S. company, was not eligible for a Secret FCL. Id. Accordingly, to avoid termination of the TWISS I Contract, Sabre and Torres entered into a novation of the TWISS I Contract on December 30, 2009. Id. ¶¶ 12-13. Pursuant to the novation, known as the Asset Purchase Agreement ("APA"), Torres became the prime contractor and Sabre the subcontractor. Id.

According to Sabre, the APA included two additional agreements as annexes (or addendums): (1) "[a] form of subcontract between Torres and Sabre for TWISS I security services that was to take effect upon the U.S. Government's approval of the novation" (the "APA Sabre Services Subcontract"); and (2) "[a] form of equipment lease agreement between Sabre and Torres for lease from Sabre to Torres of all equipment necessary for performance of the TWISS I Task Orders that was to take effect upon the U.S. Government's approval of the novation" (the "APA Sabre Lease Agreement"). Id. ¶ 13.

Sabre alleges that, under these three "agreements," Sabre was entitled to payment of pre-novation rates and that Torres was obligated to "issue priced [] TWISS I Subtask Orders to Sabre promptly after the TWISS I Novation that would give effect to [this] understanding[]." Id. ¶¶ 41-42. On February 5, 2010, the U.S. Government approved the novation. Id. ¶ 3. According to Sabre, after the novation, Torres breached its contractual obligations by failing to pay Sabre's TWISS I invoices at the rates established under the APA and its accompanying annexes, and by failing to put the TWISS I Subtask Orders in place. Id. ¶¶ 228-29.

On August 6, 2009, Sabre and Torres entered into a Teaming Agreement to bid on one of several Government Theater-wide Internal Security Services Multiple Task Order Contracts, number W91DGW-09-D-4030 ("TWISS II Contract"), which would replace existing TWISS I contracts. Id. ¶¶ 53, 61. To be eligible for a TWISS II Contract, the prime contractor was required to hold a Secret FCL as well as a Private Security Company ("PSC") License from the Iraqi Ministry of the Interior. Id. ¶¶ 58-59. Under the Teaming Agreement, Torres, which held a Secret FCL, was designated as the Leading Member and Sabre, which held a PSC License, but did not hold a Secret FCL License, was designated as a Member. Id. ¶ 61.

The Sabre-Torres team ("Team") then bid for a TWISS II Contract, which they won on August 25, 2009. Id. ¶¶ 62, 86. In accordance with TWISS II Contract procedures, the Team then competed for several TWISS II Task Order Requests ("TWISS II TORs"), which the Government issued for each military base that required security services. Id. ¶¶ 90, 106. The Team competed for these TWISS II TORs by submitting Task Order Proposals ("TWISS II Task Order Proposals") to the U.S. Government, and was ultimately successful in obtaining several TWISS II TORs. Id. ¶¶ 91, 106, 108.

According to Torres, in May 2010, Sabre breached the Teaming Agreement by failing to provide timely substantive responses to Torres' questions for additional information, which Torres needed to prepare a competitive task order proposal for Forward Operating Base ("FOB") Adder. Torres Answer and Counterclaims ¶¶ 20-25, 46 ("Torres Counterclaims") [Dkt. No. 42]. Torres alleges that, on May 21, 2010, Torres notified Sabre that it was in breach of the Teaming Agreement. Id ¶ 26. According to Torres, Sabre did not respond to the notice or attempt to cure its breach, and therefore, the Teaming Agreement terminated effective June 20, 2010. Id. ¶ 27. Torres also alleges that Sabre deliberately decided to no-bid certain FOB task order requests. Id. ¶ 48. Torres further alleges that, instead of attempting to resolve the dispute in accordance with the conflict-resolution provisions of the Teaming Agreement, Sabre complained directly to the Defense Contract Management Agency ("DCMA"), causing reputational harm to Torres, which had an adverse impact on Torres' ability to compete for other government contracts. Id. ¶¶ 52-57.

B. Procedural Background

On April 29, 2011, Sabre filed its Complaint. On May 27, 2011, Torres filed its Motion for Dismissal of the Complaint and for Partial Summary Judgment [Dkt. No. 21]. On July 25, 2011, Sabre filed its Opposition to Defendant's Rule 12(b)(6) Motion to Dismiss the Complaint [Dkt. No. 30]. On July 26, 2011, Sabre filed its Opposition to Defendant's Rule 56 Motion for Partial Summary Judgment [Dkt. No. 32]. On August 19, 2011, Torres filed its Reply in Support of its Motion for Dismissal of the Complaint and for Partial Summary Judgment [Dkt. No. 34]. On October 27, 2011, the Court granted in part and denied in part Torres' Motion for Dismissal of the Complaint and for Partial Summary Judgment [Dkt. No. 39].

On November 15, 2011, Torres filed its Answer and Counterclaims [Dkt. No. 42]. On December 20, 2011, Sabre filed its Motion to Dismiss Sabre's Counterclaims [Dkt. No. 45]. On January 9, 2012, Torres filed its Opposition to Sabre's Motion to Dismiss its Counterclaims ("Torres' Opposition") [Dkt. No. 48]. On January 27, 2012, Sabre filed its Reply ...


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