Free Joint Preliminary Status Report - District Court of Federal Claims - federal

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UNITED STATES COURT OF FEDERAL CLAIMS WYOMING SAWMILLS, INC., a Wyoming corporation, Plaintiff, v. UNITED STATES OF AMERICA, Defendant. JOINT PRELIMINARY STATUS REPORT Pursuant to the Rules of the United States Court of Federal Claims (ARCFC@), Appendix A, the parties submit this Joint Preliminary Status Report. a. Does the Court have jurisdiction over the action? ) ) ) ) ) ) ) ) ) Case No. 07-861C (Judge Braden)

Wyoming Sawmills asserts jurisdiction pursuant to 28 U.S.C. § 1491. Defendant is not aware of a basis upon which to challenge the Court's jurisdiction at this time. b. No. c. No. d. Should further proceedings in this case be deferred pending consideration of another case before this Court or any other tribunal and, if so, why? No. e. Will a remand or suspension be sought and the reasons therefore and the proposed duration? 1
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Should the case be consolidated with any other case and, if so, why?

Should the trial of liability and damages be bifurcated and, if so, why?

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No. f. No. g. Does either party intend to file a motion pursuant to RCFC 12(b), 12(c), or 56 and, if so, what is a proposed schedule for the intended filing? Plaintiff does not expect to file a motion for summary judgment at this time. At this time, the defendant cannot state whether it will file a motion pursuant to Rule 12(b), 12(e) or 56. h. What are the relevant factual and legal issues? Will additional parties be joined?

Plaintiff states: This case challenges the Forest Service=s interpretation of the Wabash Timber Sale contract, a timber sale which was sold by the USDA Forest Service from the Black Hills National Forest in South Dakota. Contract provision C8.212# provides that the contract termination and periodic payment dates may be adjusted when a drastic reduction in wood products prices occurs. However, a market related contract term addition (AMRCTA@) may not result in the contract exceeding ten years. Plaintiff maintains that the Wabash Timber Sale contract was extended beyond ten years as a result of a Forest Service agreement that allowed Wyoming Sawmills to harvest timber that was in more need of urgent removal on the Blackhawk salvage timber sale. The extension of the Wabash Timber Sale contract beyond a 10-year term to work on the Blackhawk timber sale contract, did not disqualify the Wabash contract for additional market related contract term additions, if as contract provision C8.212# provides there is Aa drastic reduction in wood products prices.@ Since the Forest Service has made a finding that there is a drastic reduction in wood products prices, the Wabash Timber Sale contract periodic payment and 2
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termination deadline qualify for an additional market related contract term addition. The Forest Service=s refusal to add the additional time to the contract is a breach of provision C8.212# and is also contrary to the contract regulation 36 C.F.R. 225.52 which is incorporated into provision C8.212#. As a consequence of the Forest Service breach, the Forest Service is not yet entitled to a $1,066,200 periodic payment. Defendant states: The timber contract at issue in this case is located in the Black Hills National Forest. The contract was awarded to Wyoming Sawmills on December 10, 1993, with an original termination date of September 30, 1999. However, as a result of five different contract adjustments, the contract is currently scheduled to terminate on December 20, 2008. The contract has been adjusted as follows: (1) On January 23, 1996, the termination date was adjusted to August 31, 2000, in order to allow Wyoming Sawmills to harvest timber in urgent need of removal in the Bighorn National Forest; (2) On September 16, 1996, the termination date was adjusted to August 31, 2001, as a result of a one-year extension granted by the Chief of the Forest Service; (3) On December 23, 1996, the termination date was adjusted to February 28, 2003, in order to allow Wyoming Sawmills to harvest additional timber in urgent need of removal in the Bighorn National Forest; (4) On January 6, 1999, the termination date was adjusted to December 10, 2003, as a result of a market-related contract term addition; and (5) On October 26, 2001, the termination date was adjusted to December 20, 2008, in order to 3
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allow Wyoming Sawmills to harvest timber in urgent need of removal in the Black Hills National Forest. In March 2007, Wyoming Sawmills requested that an additional two years of marketrelated contract term adjustment time be added to the contract's term. The Forest Service denied this request based in part on 36 C.F.R. § 223.52(c)(4) and contract provision C8.212. Section 223.52(c)(4) provides that "[i]n no event shall a revised contract term exceed 10 years as a result of market-related contract term additions." This language is incorporated into contract provision C8.212. Because the contract is not eligible for any additional market-related contract term addition under section 223.52(c)(4) and provision C8.212, there is no basis for changing Wyoming Sawmills' periodic payment due date. Under provision C8.212, the date the periodic payment is due may only be changed when a market-related contract term addition is granted. Because the contract is not eligible for such an addition, the contract cannot be modified under C8.212 to delay the periodic payment. After the Forest Service denied the request for a market-related contract term addition, Wyoming Sawmills breached the contract by failing to make the required periodic payment. The plaintiff was notified of its breach in accordance with the contract's terms. Wyoming Sawmills has not remedied its breach of contract. i. contemplated? It is possible this case may be settled. At this time, the parties do not contemplate using alternative dispute resolution. 4
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What is the likelihood of settlement? Is alternative dispute resolution

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j.

Do the parties anticipate proceeding to trial? Does any party, or do the parties

jointly, request expedited trial scheduling? What is the requested place of trial? Assuming that the case is not resolved upon motions for summary judgment, through ADR, or that the case does not settle, the parties anticipate proceeding to trial. Neither party requests an expedited trial schedule. The parties request Sheridan, Wyoming as the place for trial. k. Are there special issues regarding electronic case management needs? No. l. Is there other information of which the Court should be aware at this time? No. Discovery Plan: Plaintiff intends to engage in discovery including how contract provision C8.212# has been interpreted on other timber sale contracts that are ten years or older, and how the Forest Service has determined whether there has been Aa drastic reduction of wood products prices@ as provided under the contract. Plaintiff anticipates this discovery will occur through requests for production of documents and interrogatories and possibly some depositions. The parties propose the following discovery deadlines:

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Event Initial disclosures

Proposed Deadline October 24, 2008

Close of non-expert discovery Designation of experts Expert report(s)

January 30, 2009

February 27, 2009 April 30, 2009

Close of expert discovery, including depositions

May 29, 2009

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RESPECTFULLY SUBMITTED, GREGORY G. KATSAS Assistant Attorney General Jeanne E. Davidson Director /s Bryant G. Snee Bryant G. Snee Deputy Director /s L. Misha Preheim L. Misha Preheim Trial Attorney Commercial Litigation Branch Civil Division Department of Justice Attn: Classification Unit - 8th Floor 1100 L Street, NW Washington, DC 20530 Phone: (202) 305-3087 Fax: (202: 305-1571 Attorneys for Defendant Date: September 4, 2008

/s Scott W. Horngren Scott W. Horngren Haglund Kelley Horngren Jones & Wilder LLP 101 SW Main, Suite 1800 Portland, OR 97204 Phone: (503) 225-0777 Fax: (503) 225-1257 Attorney for Plaintiff Date: September 4, _, 2008 7
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CERTIFICATE OF FILING I hereby certify that on the 4th day of September, 2008, a copy of the foregoing was filed electronically. I understand that notice of this filing will be sent to all parties by operation of the Court=s electronic filing system. Parties may access this filing through the Court=s system.

/s/ Scott W. Horngren Scott W. Horngren OSB No. 88060 Attorney for Plaintiff

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