The court then concluded that cgi could not recover the profits lost due to fraudulent concealment – the only damage CGI claimed for this claim – because the calculation of the loss of profits was speculative. Id. at 11-12. CGI`s calculation was based on the proportion of work that the parties never included in a subcontract. The court concluded: “Simply put, cgi cannot recover profits on the basis of an agreement for a subcontract that it never entered into.” Id. at p. 12. Although FCi did not appeal the jury`s finding that it had fraudulently persuaded CGI to assist it with the revised proposal, CGI could not claim damages for the fraud. The court also dismissed CGI`s alternative unjust enrichment claim, noting that the company could have agreed to cancel the amended association agreement due to the fraud, but instead upheld the contract and filed a lawsuit for damages. A plaintiff cannot apply for unjust enrichment in Virginia if there is a binding binding contract for the subject matter. While courts have generally concluded that “pre-award” provisions in association agreements, such as exclusivity and confidentiality, are enforceable, what happens if the parties cannot agree on the terms of a subcontract after the award? In 2012, CGI signed a team agreement with FCi to jointly prepare a State Department contract proposal under which FCi would act as prime contractor and CGI as subcontractor.

Slip. Op. to 2-3. FCi retained the exclusive right to enter into the proposal and negotiate a master contract with the government. The association agreement stipulated that CGI would “receive” a 45% share of the total value of the contract awarded, but that “the commitment cannot be exactly 45% per year,” and required the parties to enter into “good faith negotiations” for a subcontract after the main contract was awarded. If the parties could not mutually agree on a subcontract within 90 days of the award, the association agreement would expire. Id. The association agreement amended by CGI-FCi identified several terms for a subcontract and acknowledged that even the 41% share of work was not set in stone.

Since CGI has no more definitive terms or appeal (p.B. if FCi CGI did not subcontract, CGI had to be confident that good faith negotiations after the award would lead to an acceptable subcontract. [1] Plaintiffs seeking damages in prime government litigation often calculate losses to include lost contributions to indirect cost pools as well as lost profits that would have generated contract revenues. See McGeehin & Johnson, Lost Profits Issues Unique to the Government Contracts Industry, in The Comprehensive Guide to Lost Profits Damages for Experts and Attorneys (4th edition). .