ANHAM alleges penalties imposed by federal departments are 'an abuse of discretion'

By Noddy A. Fernandez | May 22, 2018

ALEXANDRIA, Va. (Legal Newsline) – An airport free zone company headquartered in the United Arab Emirates alleges several government agencies have erred in imposing penalties on an alleged debt.

ALEXANDRIA, Va. (Legal Newsline) – An airport free zone company headquartered in the United Arab Emirates alleges several government agencies have erred in imposing penalties on an alleged debt.

ANHAM LLC filed a complaint on May 16 in the U.S. District Court for the Eastern District of Virginia Alexandria Division against Defense Contract Management Agency; Defense Finance and Accounting Service; and the Defense Procurement and Acquisition Policy Office citing the Administrative Procedures Act.

According to the complaint, the defendants imposed more than $1 million in penalties and the immediate collection of an alleged $6.4 million overpayment from the plaintiff. The plaintiff alleges the overpayment is under a cost-reimbursable contract with the Department of Defense and that the plaintiff has requested to defer the payment pending a decision from the Armed Services Board of Contract Appeals regarding if the debt is actually owed.

"If collection of these amounts is permitted to continue, it will result in significant and irreparable financial harm to ANHAM," the suit states.

The plaintiff holds Defense Contract Management Agency, Defense Finance and Accounting Service, and Defense Procurement and Acquisition Policy Office responsible because the plaintiff alleges the defendants' "assessment of penalties and demand for payment of such penalties is arbitrary, capricious, an abuse of discretion, and not in accordance with law, and must be enjoined," the suit states.

The plaintiff seeks preliminary and permanent injunction, to require the defendants to comply with regulations and procedures and evaluate ANHAM's September deferment request and such other relief as the court may deem just and proper. It is represented by Lindsay R. Barnes III, Christopher G. Oprison, Richard P. Rector, Dawn E. Stern and Ethan M. Brown of DLA Piper LLP (US) in Washington, D.C.

U.S. District Court for the Eastern District of Virginia, Alexandria Division case number 1:18-cv-00580-LMB-TCB

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