Dj Manufacturing Corporation v. The United States

86 F.3d 1130 (1996)

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Nature of the Case

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Facts

D government solicited an offer from P for 283,695 combat field packs to support troops who were then participating in Operation Desert Storm. The contract provided for liquidated damages for late delivery. The contract provided that, for each article delivered after the date fixed in the contract, liquidated damages would be assessed at 1/15 of one percent of the contract price for each day of delay. P missed delivery deadlines, and D withheld payment in the amount of $663,266.92 from a total contract price of $8,493,828. P sued D claiming the clause was an unenforceable penalty. Both moved for summary judgment. P claimed that the rate set forth in the liquidated damages clause was the standard rate used in many solicitations by D. P claimed that D made 'no attempt to forecast just compensation.' D claimed the product was for troops going to war, and it was needed to combat readiness; there was a need for delivery for soldiers in war. D got summary judgment, and P appealed.