Full Opinion

IN THE UNITED STATES COURT OF FEDERAL CLAIMS ______________________________________ ) IRON BOW TECHNOLOGIES, LLC, ) ) Plaintiff, ) No. 25-436 ) v. ) Filed: July 29, 2026 ) THE UNITED STATES, ) ) Defendant. ) ______________________________________ ) OPINION AND ORDER Plaintiff Iron Bow Technologies, LLC (“Iron Bow”) seeks to recover damages allegedly resulting from the Department of the Army’s (“Army” or “the Agency”) decision not to exercise the third and fourth option years of an information technology (“IT”) software contract Iron Bow held with the Agency. Iron Bow asserts that this decision violated the contract’s terms, specifically alleging that the Army: (1) breached its contractual obligation to exercise all option years subject only to its receipt of appropriations; (2) breached the contract’s non-substitution clause by acquiring replacement products during the unexercised option periods; (3) materially misrepresented its intent to exercise all option years and its expectation that the IT products that were the subject of the contract would remain essential for the full term of the contract; and (4) breached the implied duty of good faith and fair dealing by destroying Iron Bow’s reasonable expectations. The Government argues that it did not violate the contract and that Iron Bow’s interpretation of the contract would violate the Anti-Deficiency Act (“ADA”), the Federal Acquisition Regulation (“FAR”), and the Competition in Contracting Act (“CICA”). Before the Court is the Government’s Motion to Dismiss for failure to state a claim pursuant to Rule 12(b)(6) of the Rules of the United States Court of Federal Claims (“RCFC”). For the reasons stated below, the Court GRANTS IN PART the motion as to Counts I and III, and DENIES IN PART the motion as to Counts II and IV. I. BACKGROUND A. Formation and Terms of the Delivery Order On August 31, 2020, the Army issued Iron Bow indefinite-delivery indefinite-quantity (“IDIQ”) Contract No. W52P1J-20-D-0058 1 as part of the Information Technology Enterprise Solutions-Software 2 initiative in support of the Computer Hardware Software and Solutions program. Pl.’s First Am. Compl. ¶ 16, ECF No. 8. Under that IDIQ contract, the Army awarded Delivery Order No. W91RUS-21-F-0073 (“Delivery Order”) to Iron Bow on May 26, 2021. Id. ¶ 22. Through the Delivery Order, Iron Bow supplied the Army’s Network Enterprise Technology Command (“NETCOM”) with “certain Quest / NETPRO Enterprise Licenses,” consisting of “software products that provide infrastructure optimization solutions and manage complex network infrastructures . . . in support of the Army’s enterprise network directory services” (collectively “the Products”). Id. ¶ 25. Quest and NETPRO were the original manufacturers of the Products. See id.; Ex. 1 to Pl.’s First Am. Compl. at 30, ECF No. 8-1. Many of the Products supported the modernization of NETCOM’s Active Directory (“AD”) environment. ECF No. 8 ¶¶ 25–26. AD refers to a “set of processes and services for various directory-based identity-related services” supporting Windows-domain networks. ECF No. 8-1 at 2 n.1. “The database (or directory) contains critical information about the network environment, including the identity and permissions of users and computers.” Id. System administrators use AD for “controlling the authentication and authorization of users and related 1 While Iron Bow’s First Amended Complaint refers to the IDIQ as Contract No. W52PIJ- 20-D-0058, see Pl.’s First Am. Compl. ¶ 16, ECF No. 8, the Delivery Order refers to the IDIQ as Contract No. W52P1J-20-D-0058, see Ex. 1 to Pl.’s First Am. Compl. at 15, ECF No. 8-1. The Court assumes this distinction in Iron Bow’s pleading reflects a typographical error. 2 permissions for accessing and modifying the network.” Id. The specific software Products provided by Iron Bow included “Change Auditor, Recovery Manager (Forest Edition), ActiveRoles, Enterprise Reporter, Active Admin, Safeguard Virtual Session, Safeguard Privilege Security Bundle, and Quest Migration Manager.” Id. at 30. The Products perform four functions in particular: (1) AD management and migration, (2) AD security, (3) threat mitigation, and (4) recovery management. ECF No. 8 ¶ 28. Tying these functionalities to the specific Products provided, Iron Bow explains that “Quest Active Roles provides user and group account management, . . . role-based security, and identity administration.” Id. ¶ 68. “Change Auditor and Recovery Manager . . . identify which users or administrators made changes to AD objects, restore deleted objects, and monitor and secure ADs against exploits.” Id. ¶ 69. “SafeGuard enables device discovery, compliance evaluation, continuous monitoring, and access control by managing user privileges and sign-ins.” Id. ¶ 70. Finally, “Quest InTrust manages and maintains log information of all user workstation and administrator activity, including both system log-ons and logoffs,” which “enables agencies to respond to threats by deploying automated responses to suspicious activity.” Id. ¶ 71. The Delivery Order included an initial 11-month base period of performance beginning on June 1, 2021, and four subsequent year-long option periods. Id. ¶¶ 22, 30. The Delivery Order incorporated the Terms and Conditions (“payment terms”) of Iron Bow’s proposal, stating “Proposal # NETCOM05142021, dated May 14, 2021, including the Terms and Conditions outlined in Attachment 1 thereto, is hereby, in its entirety made part of, incorporated by reference and included into the Delivery Order pagination.” ECF No. 8-1 at 17. Iron Bow’s proposal included several terms relevant to the parties’ dispute: 2. Regarding FAR 52.232-19, Availability of Funds, Government will pay for the use of the products and/or services described in this contract (collectively, the 3 “Products”) in the annual option year installment payments set forth herein (the “Installment Payments”), during the base period and multiple option periods (the “Term”), subject to the Anti-Deficiency Act, 31 USC § 1341. Government intends to exercise all options and remit amounts owing in each option period in accordance with the Prompt Payment Act (FAR 52.232-25) subject only to its receipt of appropriations from Congress. Government will use best efforts to obtain appropriations and will allocate the same to make Installment Payments (which amounts are set forth on the Installment Payment Table above). There is no discount for early payment and no credit card payments are accepted. . . . 4. Government may extend or terminate this contract in whole but not in part. In the event of any termination or expiration of this contract prior to the end of the Term, Government will not during the Term replace the Products with or use products or devices having functions that the Products perform. 5. Government affirms that the Products will be essential to Government for the full Term. 6. If any of these payment terms conflict[] with any other provision of this contract or any other document, the FAR terms prevail. These terms will apply to all extensions of this contract. Id. at 29 (italicization in original). The Delivery Order also incorporated FAR 52.217-9, Option to Extend the Term of the Contract (Mar. 2000), in full text: (a) The Government may extend the term of this contract by written notice to the Contractor within 1 Day provided that the Government gives the Contractor a preliminary written notice of its intent to extend at least 30 Days before the contract expires. The preliminary notice does not commit the Government to an extension. (b) If the Government exercises this option, the extended contract shall be considered to include this option clause. (c) The total duration of this contract, including the exercise of any options under this clause, shall not exceed 5 years[.] (End of clause) ECF No. 8-1 at 22 (red text and emphasis in original). Finally, the Delivery Order incorporated FAR 52.232-19, Availability of Funds for the Next Fiscal Year (Apr. 1984), in full text: 4 Funds are not presently available for performance under this contract beyond 02 May 2022. The Government’s obligation for performance of this contract beyond that date is contingent upon the availability of appropriated funds from which payment for contract purposes can be made. No legal liability on the part of the Government for any payment may arise for performance under this contract beyond 02 May 2022, until funds are made available to the Contracting Officer for performance and until the Contractor receives notice of availability, to be confirmed in writing by the Contracting Officer. (End of clause) Id. (red text in original). As an IT software reseller, Iron Bow obtained discounts on the Products from the original manufacturers. ECF No. 8 ¶ 1. Iron Bow then passed on these discounts to the Agency. Id. Under the Delivery Order, the base period and option periods were each priced at $12,484,900. Id. ¶ 22. B. Performance and Expiration of the Delivery Order Contract performance commenced on June 1, 2021. Id. ¶ 30. The Army exercised the first option year on April 12, 2022, extending performance until May 2, 2023. Id. ¶¶ 31–32. On April 4, 2023, the Army exercised the second option year, further extending performance until May 2, 2024. Id. ¶ 33. On July 25, 2023, the contracting officer informed Iron Bow of the Agency’s decision not to exercise the third option year and noted that the Delivery Order would expire at the end of the second option year on May 2, 2024. Id. ¶ 34. In August 2023, the Army corresponded directly with an original manufacturer of the Products, Quest, about the Army’s use of AD products and the pricing available to the Army. Id. ¶¶ 35–43. On August 7, 2023, Army Enterprise Directory Capability Manager Robert Loiseau emailed Quest Global Army Team Lead Jonathan Smith, explaining that “NETCOM has decided to divest itself of all Quest tools for the Army, but the use and need [for] those tools has not gone away.” ECF No. 8-1 at 62–63. In this email, Mr. Loiseau asked “what [it] would . . . cost to use just those tools (Change Manager, Active Roles) for each theater, with training and support for 5 those tools[.]” Id. Mr. Loiseau noted that this information would be used “to advise NETCOM leadership or the [Regional Cyber Commands] on what is required, funding wise, to retain the license and support for these tools.” Id. Mr. Smith responded to Mr. Loiseau on August 10, 2023, providing a cost breakdown of the Army’s use of Change Manager, Active Roles, and other related tools. Id. at 60–62. The next day, Mr. Loiseau clarified that NETCOM was interested only in the Active Roles and Change Auditor tools, and that these licenses would be used exclusively for NETCOM. Id. at 60. In that email, Mr. Loiseau explained his understanding that “the other tools that Quest offers (under the current contract) were never used because they required additional infrastructure that [the Army] could not support.” Id. On August 18, 2023, Mr. Smith responded, clarifying that Quest “products work within [the Army’s] networking structure.” Id. at 59. Separately, Iron Bow attempted to demonstrate the Delivery Order’s necessity to the Army by giving an in-person presentation to the Agency in February of 2024. Id. at 65–67; ECF No. 8 ¶ 44. Despite Iron Bow’s effort to persuade the Army to further extend the contract, the Delivery Order expired on May 2, 2024, at the conclusion of the second option year. ECF No. 8 ¶ 46. Iron Bow alleges that, since the expiration of the Delivery Order, the Agency must have been using substitute products to provide some or all of the functions previously provided by the Products under the Delivery Order because they are essential to the Agency’s use of AD systems. Id. ¶¶ 66–67. For example, Iron Bow asserts that many of these functionalities, including “group account management, . . . role-based security, and identity administration,” are “necessary requirements for AD management.” Id. ¶ 68. Other functionalities previously provided by the Products, such as “identify[ing] which users or administrators made changes to AD objects, restor[ing] deleted objects, and monitor[ing] and secur[ing] ADs against exploits,” are similarly 6 “necessary to manage complex ADs safely and efficiently.” Id. ¶ 69. Thus, according to Iron Bow, the Army must be “us[ing] native Microsoft tools or other products to provide these functionalities.” Id. Similarly, Iron Bow argues that “device discovery, compliance evaluation, continuous monitoring, and access control [through] managing user privileges and sign-ins” are all “critical functions of AD management” that the Army must necessarily be acquiring through other means. Id. ¶ 70. Finally, Quest InTrust’s “real-time log monitoring and alerting enables [the Army] to respond to threats by deploying automated responses to suspicious activity,” which “is a critical element of AD management” that Iron Bow alleges is either being provided through a substitute product or “the native functionality of Microsoft AD products.” Id. ¶ 71. C. Procedural History On October 21, 2024, Iron Bow submitted a certified claim to the contracting officer seeking $24,969,800 in damages, the contract value of the two unexercised option years, for the Army’s alleged breach of its obligations under the Delivery Order. Id. ¶ 50; ECF No. 8-1 at 2. Specifically, Iron Bow asserted that the Agency breached the Delivery Order “by failing to exercise the final two option periods for reasons apparently unrelated to the availability of appropriations” and by “using products or devices having functions that the Products performed.” ECF No. 8-1 at 2. On January 24, 2025, the contracting officer denied Iron Bow’s certified claim. ECF No. 8 ¶ 54; Ex. 2 to Pl.’s First Am. Compl. at 2–3, ECF No. 8-2. Iron Bow filed its Complaint in this Court on March 5, 2025. See Pl.’s Compl., ECF No. 1. The Government filed a Motion to Dismiss Iron Bow’s original Complaint on June 4, 2025. ECF No. 7. In response, Iron Bow filed its First Amended Complaint on June 25, 2025. ECF No. 8. Iron Bow’s First Amended Complaint asserts four claims for relief. First, Iron Bow alleges that the Army’s decision not to renew the Delivery Order for the third and fourth option years breached the terms of the Delivery Order, which required the Army to exercise all options subject only to 7 its receipt of appropriations. Id. ¶¶ 55–63. Second, Iron Bow contends that the Agency violated the non-substitution clause because the Agency necessarily used other products providing some or all of the same functions as the Products under the Delivery Order. Id. ¶¶ 64–72. Third, Iron Bow asserts that the Army breached the Delivery Order by materially misrepresenting (a) its intent to exercise all options and (b) that the Products would be essential to the Government for the full term, which the Delivery Order defined to include the base year and multiple option periods. Id. ¶¶ 73–80. Fourth, Iron Bow alleges that the Agency breached the implied duty of good faith and fair dealing by interfering with Iron Bow’s reasonable expectation that the Agency would exercise all options under the Delivery Order. Id. ¶¶ 81–85. The Government filed the instant Motion to Dismiss on July 16, 2025. See Gov’t’s Mot. to Dismiss, ECF No. 10. The Government argues that Iron Bow’s First Amended Complaint must be dismissed in its entirety because Iron Bow’s interpretation of the Delivery Order, as requiring the Army to exercise all options subject only to receipt of appropriations, would violate the ADA. See id. at 18–29. The Government further contends that Iron Bow’s interpretation of the non- substitution clause would violate the ADA, the FAR, and CICA. Id. at 29–32. Next, the Government argues that Iron Bow’s material misrepresentation claim must be dismissed because any assertion as to the Agency’s future intent to exercise all options and its belief about the essentiality of the Products for the full term cannot form the basis for such claim. Id. at 33–36. Finally, the Government maintains that Iron Bow’s claim for breach of the covenant of good faith and fair dealing must be dismissed because Iron Bow could not have reasonably expected the Army to violate the ADA, the FAR, or CICA. Id. at 36–37. Iron Bow filed its Response on August 13, 2025. See Pl.’s Opp’n to Gov’t’s Mot. to Dismiss, ECF No. 11. In its Response, Iron Bow first argues that it adequately pled a breach of 8 contract claim based on the Agency’s non-renewal decision and violation of the non-substitution clause because the Delivery Order terms comply with the ADA, the FAR, and CICA. Id. at 11– 27. Second, Iron Bow contends that it adequately pled a material misrepresentation claim because its theory of liability does not rest upon an assertion as to a future event, but rather the Army’s intent at the time of contract, which it had authority to represent. Id. at 27–28. Third, Iron Bow asserts it adequately pled a breach of the covenant of good faith and fair dealing because its expectations were reasonable and consistent with the ADA, the FAR, and CICA. Id. at 28–29. Alternatively, Iron Bow contends that factual issues preclude dismissal. Id. at 29–30. The Government filed its Reply on August 27, 2025. See Gov’t’s Reply in Supp. of Mot. to Dismiss, ECF No. 12. The Court heard oral argument on January 16, 2026. See Min. Entry, Jan. 16, 2026. The motion is ripe for disposition. II. LEGAL STANDARDS A. Dismissal for Failure to State a Claim A court may dismiss an action if it fails to state a claim for which relief may be granted. RCFC 12(b)(6). To avoid dismissal under Rule 12(b)(6), “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw a reasonable inference that the defendant is liable for the misconduct alleged.” Pupols v. U.S. Pat. & Trademark Off., 413 F. App’x 232, 234 (Fed. Cir. 2011) (citing Ashcroft, 556 U.S. at 677–78). Although a complaint need not contain detailed factual allegations to raise a plausible claim, the plaintiff must provide “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555; see id. (explaining that “courts ‘are not bound to accept as true a legal conclusion couched as a factual allegation’” 9 (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986))). In reviewing a Rule 12(b)(6) motion, a court may consider the complaint itself, “the written instruments attached to it as exhibits, ‘documents incorporated into the complaint by reference, and matters of which a court may take judicial notice.’” Todd Constr., L.P. v. United States, 94 Fed. Cl. 100, 114 (2010) (quoting Tellabs, Inc. v. Makor Issues & Rts. Ltd., 551 U.S. 308, 322 (2007)), aff’d, 656 F.3d 1306 (Fed. Cir. 2011). The reviewing court “must assume all well-pled factual allegations are true and indulge in all reasonable inferences in favor of the nonmovant.” United Pac. Ins. Co. v. United States, 464 F.3d 1325, 1327–28 (Fed. Cir. 2006) (quoting Anaheim Gardens v. United States, 444 F.3d 1309, 1314– 15 (Fed. Cir. 2006)). B. Breach of Contract “When the United States enters into contract relations, its rights and duties therein are governed generally by the law applicable to contracts between private individuals.” Franconia Assocs. v. United States, 536 U.S. 129, 141 (2002) (quoting Mobil Oil Expl. & Producing Se., Inc. v. United States, 530 U.S. 604, 607 (2000)). To plead a breach of contract claim against the Government, a plaintiff must plausibly allege: “(1) a valid contract between the parties, (2) an obligation or duty arising out of the contract, (3) a breach of that duty, and (4) damages caused by the breach.” San Carlos Irr. & Drainage Dist. v. United States, 877 F.2d 957, 959 (Fed. Cir. 1989). A plaintiff sufficiently pleads the first element—a valid express or implied-in-fact contract with the Government—where it alleges facts showing “(1) mutuality of intent, (2) consideration, (3) an unambiguous offer and acceptance, and (4) ‘actual authority’ on the part of the government’s representative to bind the government in contract.” Hanlin v. United States, 316 F.3d 1325, 1328 (Fed. Cir. 2003) (quoting City of Cincinnati v. United States, 153 F.3d 1375, 1377 (Fed. Cir. 1998)). In assessing whether a breach of contract claim survives dismissal, “the court must interpret the contract’s provisions to ascertain whether the facts plaintiff alleges would, if 10 true, establish a breach of contract.” Bell/Heery v. United States, 739 F.3d 1324, 1330 (Fed. Cir. 2014). Finally, the plaintiff must allege its damages were caused by the breach by pleading facts showing that “(1) the damages were reasonably foreseeable by the breaching party at the time of contracting; (2) the breach [was] a substantial causal factor in the damages; and (3) the damages are shown with reasonable certainty.” Ind. Mich. Power Co. v. United States, 422 F.3d 1369, 1373 (Fed. Cir. 2005). III. DISCUSSION The Court grants the Government’s Motion to Dismiss as to Count I—breach of contract based on the Army’s non-renewal decision—because the Delivery Order did not and could not require the Army to exercise all options. The Court likewise grants the Government’s motion as to Count III—breach of contract based on the Agency’s alleged material misrepresentation— because Iron Bow has not plausibly alleged that the Army misrepresented its intent at the time of contract. The remainder of the Government’s motion is denied. Count II—breach of the non- substitution clause—states a plausible claim because that provision survived expiration of the Delivery Order and did not violate the ADA, the FAR, or CICA. Count IV—breach of the covenant of good faith and fair dealing—also survives dismissal because the claim is not redundant of Count III and Iron Bow’s alleged expectations were not unreasonable as a matter of law. A. Iron Bow’s Claim for Breach of Contract Based on the Army’s Non-Renewal Decision Fails as a Matter of Law. Iron Bow’s allegation that the Army breached the Delivery Order by failing to exercise the third and fourth option years fails to state a claim because the Delivery Order did not require the Army to exercise the option years and, in any event, the Agency lacked authority under the ADA to agree to an option-renewal term consistent with Iron Bow’s alleged interpretation. As such, 11 Iron Bow’s allegations fail to satisfy the first element of a breach of contract claim—i.e., that the alleged obligation or duty arose out of the contract. Bell/Heery, 739 F.3d at 1330. 1. The Delivery Order Did Not Require the Army to Exercise the Option Years. Iron Bow’s first count must be dismissed because the Agency did not contractually commit to exercising all option years. In analyzing Iron Bow’s claim, the Court must “begin with the plain language” of the Delivery Order. Hunt Constr. Grp., Inc. v. United States, 281 F.3d 1369, 1372 (Fed. Cir. 2002) (quoting McAbee Constr., Inc. v. United States, 97 F.3d 1431, 1435 (Fed. Cir. 1996)). When interpreting contract terms, the Court must give the contract language its “ordinary meaning unless the parties mutually intended and agreed to an alternative meaning.” Harris v. Dep’t of Veterans Affs., 142 F.3d 1463, 1467 (Fed. Cir. 1998). And it must consider the contract “as a whole and interpret[] [it] so as to harmonize and give reasonable meaning to all of its parts,” such that no portion is rendered “useless, inexplicable, void, or superfluous.” NVT Techs., Inc. v. United States, 370 F.3d 1153, 1159 (Fed. Cir. 2004). “When the contract language is unambiguous on its face, [the Court’s] inquiry ends, and the plain language of the contract controls.” Hunt, 281 F.3d at 1373. Contract interpretation is a matter of law and may be addressed in resolving a motion to dismiss if the language is unambiguous. Bell/Heery, 739 F.3d at 1330. The contract interpretation dispute underlying Count I centers on the amount of discretion the Army retained to exercise option years. As the Government emphasizes, the standard option clause, FAR 52.217-9, which was incorporated into the Delivery Order, see ECF No. 8-1 at 22, provided the Army “complete discretion” as to whether “to exercise the option years.” Beacon Point Assocs., LLC v. Dep’t of Veterans Affs., 139 F.4th 1306, 1308 (Fed. Cir. 2025) (interpreting the plain language of FAR 52.217-9). Iron Bow argues, however, that the payment terms of its 12 proposal, which were also incorporated into the Delivery Order, 2 limited the Agency’s discretion under FAR 52.217-9 by stating that the “Government intends to exercise all options and remit amounts owing in each option period . . . subject only to its receipt of appropriations from Congress,” which the “Government will use best efforts to obtain.” ECF No. 8-1 at 29. According to Iron Bow, this option-renewal term “required” the Army to exercise all options provided that it received appropriations. See ECF No. 8 ¶ 56. The Government counters that this term was merely a statement of the Army’s “present intention,” at the time of contract, rather than “a statement of future obligation.” ECF No. 10 at 26. The Court agrees with the Government. The ordinary meaning of the payment term stating that the “Government intends to exercise all options,” ECF No. 8-1 at 29, is that the Army, at the time of entering the Delivery Order, planned to exercise all options. It does not mean that the Army was contractually required to do so. The plain meaning of the word “intend” is “to have in mind” or to “plan.” Intend, The American Heritage Dictionary (5th ed. 2022). Conversely, the ordinary meaning of the word “require” is “to impose an obligation on” or to “compel.” Require, The American Heritage Dictionary (5th ed. 2022). This interpretation is also consistent with caselaw analyzing similar expressions of intent. See, e.g., Westlands Water Dist. v. United States, 109 Fed. Cl. 177, 199 (2013) (holding that “government representations are not binding contractual obligations unless stated as an undertaking rather than an intention”); Uniq Computer Corp. ex rel. U.S. Leasing Corp. v. United States, 20 Cl. Ct. 222, 232 (1990) (holding that a “statement by the optionee of a present intention to accept in the future is different from a statement of an intention to accept now” (quoting Arthur L. Corbin, Corbin on Contracts, A Comprehensive Treatise on the Working Rules 2 At this stage, neither party disputes that the payment terms of Iron Bow’s proposal were incorporated into the Delivery Order. See Oral Arg. Tr. at 17:22–18:1, ECF No. 16. 13 of Contract Law § 264 (1963))); Chattler v. United States, 632 F.3d 1324, 1333 (Fed. Cir. 2011) (“The obligation of the government, if it is to be held liable, must be stated in the form of an undertaking, not as a mere prediction or statement of opinion or intention.” (quoting Cutler- Hammer, Inc. v. United States, 441 F.2d 1179, 1182 (Ct. Cl. 1971)). Thus, reading the Delivery Order’s language as a whole and in harmony, as the Court must, see NVT Techs., 370 F.3d at 1159, the Army retained complete discretion to exercise option years while also representing its contemporaneous plan to exercise all options subject to its receipt of appropriations, although it did not commit itself to do so. 3 Iron Bow argues that this interpretation is unreasonable because the option-renewal term specified only one qualifier on the Agency’s intent to exercise the options—that it was “subject only . . . to its receipts of appropriations.” ECF No. 11 at 19 (emphasis added in Iron Bow’s Opposition) (citing ECF No. 8 ¶ 19 and ECF No. 8-1 at 29). In Iron Bow’s view, reading the term as a statement of present intention rather than one of future obligation would render this qualifying language superfluous. Id. at 19–20. The Court disagrees. The sole qualifier is not superfluous as it modified the Army’s present intent. That is, the Agency indicated its intent was to exercise all options unless appropriations were not available. 3 Relying on FAR 52.217-9, the Government invokes the order of precedence provision in Iron Bow’s payment terms, which provided that “[i]f any of these payment terms conflict[] with any other provision of this contract or any other document, the FAR terms prevail.” ECF No. 8-1 at 29. The Court need not resort to the order of precedence provision because the option-renewal term does not conflict with FAR 52.217-9. Rather, as explained, Iron Bow’s term reflected the Agency’s present intent to exercise the option years but did not obligate the Agency to do so. See Int’l Transducer Corp. v. United States, 30 Fed. Cl. 522, 526 (1994) (“Established court precedent and rules of construction require that contract provisions should not be interpreted as conflicting with one another unless there is no other possible reasonable construction of the language.” (citing Hol–Gar Mfg. Corp. v. United States, 169 Ct. Cl. 384, 395 (1965))), aff’d, 48 F.3d 1235 (Fed. Cir. 1995); Sperry Corp. v. United States, 845 F.2d 965, 968 (Fed. Cir. 1988) (affirming decision declining to apply order of precedence clause where no inconsistency existed). 14 In any event, Iron Bow’s attempt to use the qualifying language to wholly alter the meaning of the first part of the option-renewal term is a leap too far. A “qualification” is a “modification or limitation of terms or language.” Qualification, Black’s Law Dictionary (12th ed. 2024). And the word “modify” is generally understood to mean “to make modest adjustments and additions to existing provisions, not transform them.” Biden v. Nebraska, 600 U.S. 477, 494–95 (2023) (citing Webster’s Third New International Dictionary 1952 (2002); and Modify, Black’s Law Dictionary (11th ed. 2019)). Iron Bow seeks to use this qualifier to replace the word “intends” with “is required to.” See ECF No. 11 at 19–20. Such an effort “transform[s]” the meaning of the term rather than “make[s] modest adjustments.” Biden, 600 U.S. at 494 (holding that a statute giving the agency authority to “waive or modify” existing statutory or regulatory provisions did not give the agency authority “to rewrite th[e] statute from the ground up”). Thus, Iron Bow’s reliance on the option-renewal term’s sole modifier is unavailing. Finally, although the Government invokes the doctrine of contra proferentem, see ECF No. 10 at 26–27, the Court finds the doctrine irrelevant here because the option-renewal term is unambiguous. “[T]he rule of contra proferentem . . . requires that ambiguous or unclear terms that are subject to more than one reasonable interpretation be construed against the party who drafted the document.” Turner Constr. Co. v. United States, 367 F.3d 1319, 1321 (Fed. Cir. 2004). The plain language of the relevant term is only subject to one reasonable interpretation: that the Army, at the time the parties entered into the Delivery Order, intended to exercise all option years under the Delivery Order subject only to its receipt of appropriations. Iron Bow seeks to rewrite the word “intends” to mean “is required to,” but such an interpretation is unreasonable as it is inconsistent with the ordinary meaning of the option-renewal term. Thus, the Delivery Order did not require the Agency to exercise all option periods subject only to its receipt of appropriations. 15 2. The Army Lacked Authority at the Time of Contract to Contractually Obligate the Government to Exercise All Options. Even if the meaning of the term at issue was ambiguous, the ADA prohibits an interpretation under which the Agency committed itself at the time of contract to exercising all options. The Government argues that Iron Bow’s interpretation of the option-renewal term would conflict with the ADA, which—under U.S. Supreme Court precedent—provides that a contract extending beyond the initial period of available appropriations can only bind the Government for each subsequent period if an appropriation is made for the period and the agency affirmatively renews the contract under the authority of that appropriation. See ECF No. 10 at 18–25. Iron Bow counters that its interpretation of the option-renewal term complies with the ADA because the Delivery Order did not contemplate automatic renewal and instead only limited the Army’s discretion not to exercise the options. See ECF No. 11 at 12–19. The Court finds that Iron Bow’s interpretation of the Delivery Order impermissibly limits the Agency’s discretion as to whether to take affirmative action to exercise the option years such that, under Iron Bow’s reading, the Agency essentially agreed to exercise all option periods at the time of entering the Delivery Order in violation of the ADA. With limited exceptions not relevant here, the ADA prohibits federal employees or agencies from involving the “government in a contract or obligation for the payment of money before an appropriation is made.” 31 U.S.C. § 1341(a)(1)(B). Thus, government employees and agencies lack statutory authority to “enter[] into a contract for future payment of money in advance of, or in excess of, an existing appropriation.” Hercules Inc. v. United States, 516 U.S. 417, 427 (1996). Where a government agent, “acting beyond the scope of their authority,” purports to do so, “the government is not bound.” Johnson Mgmt. Grp. CFC, Inc. v. Martinez, 308 F.3d 1245, 1255–56 (Fed. Cir. 2002). 16 Given the ADA’s prohibition against contracting in advance of existing appropriations, and the associated limitation on the Government’s authority to contract for future needs, the Supreme Court has held that two requirements must be met before a contract funded with a one- year appropriation may bind the Government for additional years beyond the first. 4 Leiter v. United States, 271 U.S. 204, 207 (1926). First, an “appropriation [must] be made available for the payment.” Id. Second, the Government must “affirmatively continue the [contract] for such subsequent year.” Id. Put differently, to bind the Government for each subsequent year, the Supreme Court’s precedent interprets the ADA to require that the Government must “in effect, make a new [contract] for [each subsequent] year under the authority of such appropriation.” Goodyear Tire & Rubber Co. v. United States, 276 U.S. 287, 292 (1928). Courts and boards have consistently applied Leiter and Goodyear as precluding interpretations of contract terms that purport to bind the Government beyond the period of available appropriations. For example, other judges of the Court of Federal Claims have interpreted Leiter and Goodyear to require that, where an agency enters into a multi-year contract with a one-year appropriation, the Government must affirmatively renew the contract following receipt of subsequent appropriations in order to bind the Government for each succeeding period. See Cray Rsch., Inc. v. United States, 44 Fed. Cl. 327, 333 (1999) (construing contract as affording the Government the “unilateral right to renew” because a contrary interpretation would not result in “a valid and binding document”); RCS Enters. v. United States, 57 Fed. Cl. 590, 595 (2003) 4 Congressional appropriations are categorized based on the duration of their availability for obligation: (1) a one-year appropriation “is available for obligation only during a specific fiscal year”; (2) a multiple-year appropriation “is available for obligation for a definite period of time in excess of one fiscal year”; and (3) a no-year appropriation “is available for obligation for an indefinite period.” Gov’t Accountability Off., Principles of Federal Appropriations Law 2-9, ch. 2, § A.8.a, GAO-16-464SP (4th ed., 2016 rev.). 17 (holding that a “contract, on its face, violates the ADA” if the remaining years after the base years were not “true options” such that “the Government merely could decline to exercise its option with respect to those years”). At least one other court has similarly interpreted Leiter and Goodyear to hold that “[a] contract will only bind the government in subsequent years if appropriations are made in those ‘out years,’ and if the government affirmatively renews the contract.” Williams v. District of Columbia, 902 A.2d 91, 95 (D.C. 2006). Likewise, the Armed Services Board of Contract Appeals (“ASBCA”) has interpreted Leiter as “preclud[ing] the initial contract from imposing upon future government officials a duty to automatically renew the lease.” Mach I AREP Carlyle Ctr. LLC, ASBCA No. 59821, 16-1 BCA ¶ 36,389 at 177,419 (June 1, 2016). At the time of issuing the Delivery Order to Iron Bow, the Army did not have authority to commit to an obligation for the payment of money for performance of the contract beyond the 2021 fiscal year. Iron Bow does not allege the existence of either multiple-year or no-year appropriations, and indeed, the Government explains that the Delivery Order’s Line of Accounting indicates that the Army used a one-year appropriation limited to fiscal year 2021. See ECF No. 10 at 10–11. Thus, even viewing the facts in the light most favorable to Iron Bow, the Agency utilized appropriations limited to fiscal year 2021 to enter into the Delivery Order and could not, under the AD