Ace-Federal Reporters, Inc. v. Barram

226 F.3d 1329 · Court of Appeals for the Federal Circuit · 2000

Facts

The General Services Administration (GSA) awarded multiple-award schedule contracts for transcription services to several companies, including the appellants. Despite a requirements clause and regulations, some federal agencies purchased these services from non-contract companies without obtaining required waivers. The contractors sued for breach, seeking lost profits, but the GSA Board denied recovery, finding the contracts were not "requirements contracts" and thus offered no guarantee of business.

Issue

Did the GSA Board err in precluding the recovery of lost profits for the government's breach of multiple-award schedule contracts, based on its determination that these were not "requirements contracts" and therefore did not guarantee business?

Holding

The Federal Circuit reversed the GSA Board's decision, holding that the board erred in concluding that the terms of the contracts preclude recovery of lost profits. The court found that lost profits are recoverable for the government's breach of these contracts, and remanded the case for calculation of damages.

Rule

Contracts that provide a "chance at business" through a limited-source schedule, even without a guaranteed minimum quantity, are enforceable, and breach by unauthorized off-schedule purchases can lead to recovery of lost profits. The value of this chance, if measurable, supports a claim for lost opportunity damages.

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Case brief last reviewed 2026-04-18. Prepared by CaseReader from the published opinion.