[00:00:00] Speaker 01:
Our next case is ACC Construction Company, Inc.

[00:00:03] Speaker 01:
v. Secretary of the Army, 23-1372.

[00:00:07] Speaker 01:
All right, Mr. Scott, you have reserved three minutes for rebuttal, and we're ready when you are.

[00:00:17] Speaker 04:
So we have two questions to talk about here today.

[00:00:21] Speaker 04:
One is a question of fact.

[00:00:23] Speaker 04:
And that question is, did the government know before it proposed or published the solicitation that this project site was going to be considered a hot spot requiring significant extra stormwater treatment requirements?

[00:00:36] Speaker 04:
And the second is, if that's the case, if the government did know that information, does the Permits and Responsibilities Clause relieve the government of its obligation to disclose that knowledge to a contractor?

[00:00:49] Speaker 01:
Doesn't that clause place an obligation on you to understand what's necessary to get the adequate permitting?

[00:00:59] Speaker 04:
It certainly does, Your Honor.

[00:01:00] Speaker 04:
And ACC doesn't take the position, in fact, that it's not subject to the requirements of the clause or that the clause has been misapplied in particular.

[00:01:10] Speaker 04:
But what the clause doesn't do is place onto a contractor the risk that the government will not meet other of its contracting obligations, in this case, its obligation to disclose superior knowledge.

[00:01:22] Speaker 04:
The Permits and Responsibilities Clause comes from a policy of clear risk allocation.

[00:01:27] Speaker 04:
And for the work that it does, it is very clear.

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All risk for requirements that are outside the direct control of the contracting agency falls to the contractor.

[00:01:38] Speaker 04:
That's not particularly surprising.

[00:01:41] Speaker 04:
It's clear.

[00:01:41] Speaker 04:
It's been well known for decades.

[00:01:43] Speaker 04:
In this case, though,

[00:01:44] Speaker 03:
So what is your best evidence that the government knew this was or was likely to be a hotspot?

[00:01:51] Speaker 04:
So there are two particular issues.

[00:01:53] Speaker 04:
The first was back in July of 2015, the Real Property Planning Board for Fort AP Hill, where the project was located, identified the project site as industrial.

[00:02:04] Speaker 04:
And it's showed on a map.

[00:02:05] Speaker 04:
And the map is, we've cited it in the record,

[00:02:09] Speaker 04:
but it's outlined as industrial.

[00:02:10] Speaker 04:
The legend on the industrial on that map, it shows a number of things.

[00:02:15] Speaker 04:
It shows paved and heavily paved, and then unpaved areas.

[00:02:19] Speaker 04:
It shows paved and unpaved parking, storm ponds, and wetlands.

[00:02:24] Speaker 04:
Those are all things that the Virginia DEQ, the Department of Environmental Quality, would also consider when making a determinant of whether the project site is a hotspot.

[00:02:36] Speaker 04:
In addition to that,

[00:02:38] Speaker 04:
This information was propagated by the Department of the Planning Board for Fort AP Hill, but it was specifically then passed on a number of times until it got to the Army Corps, who is the contracting agency in this case.

[00:02:53] Speaker 04:
And our position is, if it's not important,

[00:02:56] Speaker 04:
Why is the government passing it on repeatedly inside, internally?

[00:03:00] Speaker 04:
This meant something to them.

[00:03:02] Speaker 04:
And our contention is that it was more than just the zoning for it to be industrial or non-industrial.

[00:03:10] Speaker 04:
As far as we're concerned, once the Army tells the Army Corps where to build, all the Army Corps has to do is then build on that spot.

[00:03:17] Speaker 04:
The zoning is outside the responsibility of the Army Corps.

[00:03:21] Speaker 04:
So that's the first piece of evidence, Your Honor.

[00:03:23] Speaker 01:
The second piece.

[00:03:26] Speaker 01:
does not show any evidence that the government knew that this was an industrial hotspot.

[00:03:35] Speaker 04:
Well, we disagree with that, Your Honor.

[00:03:37] Speaker 05:
But the board made a finding, right?

[00:03:39] Speaker 04:
And that's specifically one.

[00:03:41] Speaker 05:
To win, you don't have to just show evidence to the contrary.

[00:03:44] Speaker 05:
You have to show that no reasonable person could reach that finding.

[00:03:48] Speaker 05:
So if there's evidence to support the board's finding, then we don't have to reach this legal issue about a supposed conflict between superior knowledge and the permit requirement, because there's no superior knowledge.

[00:04:01] Speaker 04:
That's correct, Your Honor.

[00:04:02] Speaker 04:
That's right.

[00:04:03] Speaker 04:
So to your question about the record, including information, that there was knowledge.

[00:04:09] Speaker 04:
So I've spoken about the first piece, the industrial designation.

[00:04:15] Speaker 04:
And yes, the government makes a point that that is not the DEQ's designation of the project site.

[00:04:23] Speaker 04:
We don't maintain that it is.

[00:04:25] Speaker 04:
What we maintain is that it was important because if ACC had known that the government understood that this project was going to require heightened stormwater management requirements, it would have designed its project differently and it would have looked at the requirements differently.

[00:04:41] Speaker 04:
There are public requirements, the table, particularly in table 8.10.

[00:04:45] Speaker 05:
But the government didn't know.

[00:04:46] Speaker 05:
This is the problem.

[00:04:48] Speaker 05:
the board found the government didn't know that this was going to be considered.

[00:04:52] Speaker 05:
I'm a little confused.

[00:04:53] Speaker 05:
I want to make sure we use the right terms.

[00:04:56] Speaker 05:
Ultimately, didn't Virginia find that this was a non-industrial hot spot?

[00:05:00] Speaker 05:
That's correct.

[00:05:01] Speaker 05:
So that's the superior knowledge that you're claiming the government knew about.

[00:05:06] Speaker 04:
Not quite, Your Honor.

[00:05:07] Speaker 04:
The superior knowledge that we are claiming that the government had is that the site would require increased stormwater management.

[00:05:15] Speaker 04:
factors, is what they call it in Virginia.

[00:05:19] Speaker 04:
Because whether it's an industrial hotspot or a non-industrial hotspot, ACC didn't believe that it was either one of those.

[00:05:26] Speaker 04:
And it didn't believe that for a number of reasons.

[00:05:28] Speaker 04:
The first is that its designer of record had designed a site functionally identical to this one on Fort A.P.

[00:05:35] Speaker 04:
Hill, subject to the same DEQ regulations, and that DEQ found it wasn't a hotspot.

[00:05:41] Speaker 04:
But the problem is that

[00:05:43] Speaker 05:
The federal government didn't know how Virginia was going to characterize this.

[00:05:49] Speaker 05:
They did not know that Virginia was going to call this a non-industrial hotspot.

[00:05:58] Speaker 05:
I mean, the evidence you decided to me that there'd been another project that wasn't considered a hotspot would lead me to think that the government also maybe thought this wasn't a hotspot.

[00:06:07] Speaker 04:
Well, the government had an idea that there were going to be heightened stormwater management requirements on this project.

[00:06:16] Speaker 05:
But it's not enough to know that there might be heightened.

[00:06:18] Speaker 05:
I mean, they put that in the contract, that there are stormwater regulations.

[00:06:23] Speaker 05:
You have to make sure you comply with that.

[00:06:25] Speaker 05:
If what we're talking about in superior knowledge is the specific piece of superior knowledge that required you to get additional cost, which is

[00:06:34] Speaker 05:
that Virginia ultimately found this to be a non-industrial hotspot, there is no evidence that the government ever knew that Virginia would characterize this as a non-industrial hotspot, right?

[00:06:44] Speaker 04:
There was an email in January of 2016 that was sent to Mr. Michael Higgins, who was the project manager for this project, and the personnel within the Army Corps... Do you have an appendix page?

[00:06:56] Speaker 03:
It looks like a reading for something.

[00:06:57] Speaker 03:
Do you have an appendix page?

[00:06:58] Speaker 04:
Yeah.

[00:06:59] Speaker 04:
Is it appendix 1115?

[00:07:03] Speaker 04:
The determination was there will be significant stormwater managements that must be addressed.

[00:07:10] Speaker 04:
Now, significant stormwater management, that means something above the normal.

[00:07:14] Speaker 04:
That's a hot spot.

[00:07:15] Speaker 05:
Did the contract not specify that there were stormwater regulations that were applicable to this?

[00:07:20] Speaker 05:
That was your responsibility?

[00:07:22] Speaker 05:
Well, our position is that- Why does significant stormwater issues translate to knowledge of non-industrial hot spots?

[00:07:33] Speaker 04:
Well, it seems it's important that the government was sending this information internally to the folks who are on the project.

[00:07:40] Speaker 04:
Because otherwise, everybody knew there were already stormwater requirements.

[00:07:44] Speaker 04:
That's, like you said, it's in the solicitation.

[00:07:47] Speaker 04:
But the note here is that they're significant.

[00:07:50] Speaker 04:
That means there's something other than what's already in the solicitation.

[00:07:53] Speaker 05:
So the government had an idea that the solicitation said you have to comply with whatever Virginia does.

[00:07:58] Speaker 05:
So everything was in the solicitation.

[00:08:01] Speaker 04:
Well, what wasn't in the solicitation that the project will require significant stormwater requirements.

[00:08:07] Speaker 04:
In other words, over and above the standard non-hot spot.

[00:08:10] Speaker 05:
So you're laying an awful lot of weight on the word significant in an email to connect it up to the increased costs from non-industrial hotspot.

[00:08:20] Speaker 05:
that the government didn't know of.

[00:08:22] Speaker 05:
Is there any evidence that the, because you may say significant, that doesn't show the government knew of exactly what was going to happen here.

[00:08:30] Speaker 05:
And that's what you have to show for superior knowledge, isn't it?

[00:08:33] Speaker 04:
Yes, it is.

[00:08:34] Speaker 04:
But our position is that these two pieces of evidence show that the government did know something.

[00:08:40] Speaker 04:
But the board cited a bunch of things about why the government didn't know.

[00:08:44] Speaker 04:
The board cited evidence of what happened after the fact.

[00:08:48] Speaker 04:
All that's evidence of is that it happened after contract award.

[00:08:51] Speaker 01:
When you bid on the contract, you represented that this consulting group that you hired, Mason and Haggard, that they will quote a design team

[00:09:02] Speaker 01:
that has experience coordinating with Fort AP Hills and Chesapeake Bay office in the Commonwealth of Virginia.

[00:09:11] Speaker 01:
Shouldn't they have told you or shouldn't they have known that what you were working with was a non-industrial hotspot or simply something that would require this remedial lining for the water running off?

[00:09:28] Speaker 04:
So this goes back to the designer Mason and Hanger, their experience.

[00:09:32] Speaker 04:
As I mentioned, they had designed a project that's functionally similar to this one, and the important piece here is the aggregate parking lot, which for the record was specified by the government.

[00:09:43] Speaker 04:
So this aggregate parking lot specified by the government.

[00:09:46] Speaker 04:
But Mason and Hanger had done another project on the same facility, subject to the same DEQ regulations,

[00:09:52] Speaker 04:
and it wasn't determined to be a hotspot.

[00:09:55] Speaker 01:
And what that tells us is that even though there was... That alerts them to the fact that it could be a hotspot, that Virginia could decide that this particular project could be a hotspot, and you held this group out as having certain expertise in this very question that we're talking about.

[00:10:12] Speaker 04:
And part of their expertise, your honor, is their experience doing projects just like this one.

[00:10:18] Speaker 04:
And it seems illogical that we would expect DEQ's behavior to change from one project to the other when the basic specifications... Wait, you think it's illogical for a government permitting agency to change its mind about things?

[00:10:34] Speaker 05:
Have you ever tried to build a house in a historic zone or anything like this?

[00:10:39] Speaker 05:
They change their mind all the time.

[00:10:41] Speaker 05:
That's why how can you expect to impute knowledge of what Virginia was going to do to the federal government at the time of the solicitation award?

[00:10:50] Speaker 05:
There's no evidence in the record that the government knew that Virginia would characterize this project in any specific way.

[00:10:58] Speaker 05:
Is there?

[00:10:59] Speaker 04:
In a specific way, no, but they did know that it would require something additional in terms of being a hotspot.

[00:11:06] Speaker 04:
Because there was something that they understood there as important.

[00:11:09] Speaker 04:
And like I said, why would they transmit that information that it was an industrial site all the way up to the Army Corps?

[00:11:15] Speaker 04:
That was important for some reason.

[00:11:17] Speaker 05:
Are you saying that the Mason people also didn't understand that stormwater permitting was important?

[00:11:25] Speaker 04:
No, that's not what at all.

[00:11:26] Speaker 05:
Well, that's all the government knew that it was important.

[00:11:28] Speaker 05:
You just said that if they knew it was important and they knew that they were going to have to get approval from from Virginia, they have the exact same knowledge that the government had.

[00:11:38] Speaker 04:
What I'm saying was important primarily is the fact that the government considered it an industrial site.

[00:11:43] Speaker 04:
That's not information that ACC or its designer of record had or could have had.

[00:11:48] Speaker 05:
All of that information was within the government's... But we know from the record that use of the phrase industrial is not that the Virginia stormwater use of industrial.

[00:11:57] Speaker 05:
It's a different thing.

[00:11:58] Speaker 05:
They weren't talking about stormwater when they were talking about that.

[00:12:02] Speaker 05:
That may be so, but what it says is that the government... Doesn't that make that evidence not relevant to the substantial evidence questioning here?

[00:12:09] Speaker 04:
No, I think it does make it relevant when you consider it with the other evidence that the government had knowledge that this site was going to be treated differently than a non-hot spot that didn't require a permit.

[00:12:20] Speaker 02:
So you point us to Appendix page 1115.

[00:12:21] Speaker 02:
Is there anything else you would point us to to support up your arguments you're making here today about the knowledge?

[00:12:27] Speaker 02:
About the knowledge?

[00:12:27] Speaker 03:
Yeah.

[00:12:28] Speaker 04:
Well, the only other knowledge that we can point to is, very shortly after award, a number of government employees identified this as a hot spot or an industrial spot.

[00:12:39] Speaker 04:
Those occurred after award.

[00:12:41] Speaker 04:
We believe that they had knowledge of that beforehand, but the record doesn't have evidence of that in it, so we certainly can't cite that.

[00:12:47] Speaker 04:
So acknowledged, our knowledge, our facts that the government knew of this, are not perfect.

[00:12:54] Speaker 04:
But we think that they are sufficient enough to show a reasonable person would think that the government did know something was happening here.

[00:13:02] Speaker 05:
But are they sufficient to show that no reasonable person could find that the government didn't have knowledge?

[00:13:08] Speaker 05:
Your Honor, I don't believe the standard is really sketchy evidence that would support your finding if the board had ruled in your favor.

[00:13:17] Speaker 05:
But there has to be a complete lack of evidence supporting the board's finding.

[00:13:21] Speaker 05:
And the government's going to get up here in a minute or so and point to evidence that supports the board's finding.

[00:13:28] Speaker 05:
And we can't reweigh the evidence.

[00:13:33] Speaker 04:
I mean, we've presented the evidence that we have in the record.

[00:13:36] Speaker 05:
You presented the board.

[00:13:37] Speaker 05:
The board disagreed with you.

[00:13:39] Speaker 04:
And that's why we're here, Your Honor.

[00:13:41] Speaker 05:
Well, yeah, but we don't get to make a new factual finding.

[00:13:43] Speaker 05:
And if there's substantial evidence on both sides, then you lose.

[00:13:48] Speaker 04:
Well, we think that there isn't substantial evidence that the government didn't know something before award.

[00:13:53] Speaker 04:
The only evidence in the record is that.

[00:13:54] Speaker 05:
That's not the right standard.

[00:13:55] Speaker 05:
Didn't know something?

[00:13:57] Speaker 05:
Didn't know that this was going to be a non-industrial hotspot.

[00:14:03] Speaker 04:
So I misspoke, Your Honor.

[00:14:05] Speaker 04:
We don't believe that the record shows that, with any sort of certainty, that the government didn't know this would be a hotspot before award or before the solicitation was issued.

[00:14:14] Speaker 01:
OK, you're into your rebuttal time.

[00:14:17] Speaker 01:
You want to save it, or?

[00:14:18] Speaker 04:
I will save it, Your Honor.

[00:14:20] Speaker 01:
Thank you.

[00:14:20] Speaker 01:
We'll restore your time back.

[00:14:28] Speaker 00:
May it please the court, the board correctly rejected ACC's superior knowledge claim.

[00:14:33] Speaker 00:
The record shows, and substantial evidence supports, that the government never had the knowledge asserted by ACC.

[00:14:39] Speaker 00:
And there can be no superior knowledge situation here because

[00:14:42] Speaker 00:
ACC had a contractual obligation through numerous statements in the solicitation on top of the permits and responsibilities clause to find out through publicly available information.

[00:14:53] Speaker 05:
I want you to tell me what the substantial evidence is, but let me ask you, could you just raise a legal question first?

[00:14:59] Speaker 05:
If the government had superior knowledge, the permits clause wouldn't excuse you of a superior knowledge claim, would it?

[00:15:06] Speaker 00:
No, Your Honor, and the board didn't even reach that finding in the first place.

[00:15:09] Speaker 00:
But they're mutually exclusive areas.

[00:15:12] Speaker 00:
If the government has superior knowledge, then it's something the contractor wouldn't be able to find out under its permits and responsibilities clause responsibilities.

[00:15:20] Speaker 00:
So the board didn't even discuss that issue because it found there was no superior knowledge in the first place.

[00:15:27] Speaker 05:
And what's the evidence supporting that finding?

[00:15:29] Speaker 00:
There's several things, Your Honor.

[00:15:31] Speaker 00:
First of all, what ACC is relying on is how the Fort AP property planning board, which is not the core, designated the site as industrial for base planning purposes.

[00:15:43] Speaker 00:
And that was, you know, to make sure that certain types of buildings that don't go well together are not next to each other.

[00:15:49] Speaker 00:
I think the board said, you know, so a firing range is not next to the dorms.

[00:15:54] Speaker 00:
Calling it industrial, using that terminology for base planning purposes,

[00:15:58] Speaker 00:
is not the same thing as DEQ designating it as a stormwater permitting hotspot.

[00:16:04] Speaker 00:
There's no evidence that DEQ, nothing in the DEQ regulation says what other bodies call a site has any relevance to its permitting.

[00:16:13] Speaker 01:
Is this made on a case-by-case basis, the decision of whether something is a hotspot or not?

[00:16:19] Speaker 00:
I mean, DEQ has its specifications, and in fact, very important specification here is Table 8.10, which is Appendix 1026.

[00:16:29] Speaker 00:
And it's a list of potential stormwater hot spots that DEQ has made publicly available.

[00:16:37] Speaker 00:
company or its designer that claims to be experienced can look at that table and say, am I building one of these things?

[00:16:45] Speaker 00:
Does my thing have these features?

[00:16:47] Speaker 00:
And then they should be able to tell if it is going to be a hotspot or not.

[00:16:51] Speaker 00:
And one of those items is parking lots of over 40 spots.

[00:16:56] Speaker 00:
So here, the design had a 900 spot parking lot.

[00:17:00] Speaker 00:
So if DEQ did something inconsistent in the past and didn't apply its regulations in a certain way,

[00:17:07] Speaker 00:
I think that's a classic bell-heary situation where that's not the responsibility of the federal government.

[00:17:12] Speaker 00:
It's within the Permits and Responsibilities Clause for the contractor to work that out.

[00:17:17] Speaker 01:
Maybe it would have alerted, and you're right, it would have alerted the contractor to the potential that this is a non-industrial hotspot, but also for the government, right?

[00:17:29] Speaker 00:
I mean, everyone had the same level of knowledge.

[00:17:32] Speaker 01:
The superior knowledge... This is what I find incredible about the case is that

[00:17:36] Speaker 01:
Everybody seemed to know that the potential for this to be classified as a non-industrial hotspot, that that existed.

[00:17:46] Speaker 01:
And yet, nobody brought it up.

[00:17:49] Speaker 00:
Well, I mean, the government put in the solicitation numerous points that, I mean, for example, it said the permit might take 180 days.

[00:18:00] Speaker 00:
The solicitation stated that the site work included stormwater management, including proposed best management practices.

[00:18:06] Speaker 00:
And it actually required the offerors to discuss their experience complying with Virginia's stormwater management requirements on projects of this size and said, how is the offer going to apply

[00:18:18] Speaker 00:
for a stormwater permit.

[00:18:20] Speaker 00:
So also, I mean, the contractor could have reached out to DEQ ahead of time to discuss this issue and how these specifications might interact with each other.

[00:18:31] Speaker 00:
The superior knowledge clause is about disparate knowledge.

[00:18:34] Speaker 05:
Right.

[00:18:34] Speaker 05:
The fact that everybody knows of the potential defeats the superior knowledge claim, right?

[00:18:38] Speaker 00:
Correct.

[00:18:38] Speaker 05:
It's not something where... Can you get back to citing... And I know it's hard to prove a negative, so maybe you don't have anything else.

[00:18:44] Speaker 05:
But when I asked you to cite the evidence that supports the government's lack of knowledge, you knocked down their evidence about why they did have knowledge, which seems perfectly fine.

[00:18:54] Speaker 05:
Is there anything specific?

[00:18:56] Speaker 05:
Was there testimony or documents or anything where the government said, we didn't know about this non-industrial hot spot at the time of award?

[00:19:07] Speaker 00:
I don't believe that there's something where someone said, we had no idea this could be a hot spot.

[00:19:13] Speaker 00:
But I think the government has put it in the solicitation that this is something that contractors need to be aware of and be complying with, and that if these regulations are publicly available, it wasn't.

[00:19:28] Speaker 05:
So there's nothing in the record.

[00:19:30] Speaker 05:
So we say the board made a finding.

[00:19:32] Speaker 05:
The government had no knowledge that this was

[00:19:34] Speaker 05:
going to be a non-industrial hotspot.

[00:19:39] Speaker 05:
There's nothing in the record beyond just inferences because

[00:19:43] Speaker 05:
They point to nothing and it's their burden, I take it, that shows the government had that direct knowledge that it was going to be a non-industrial hotspot.

[00:19:52] Speaker 05:
All they can point to is the industrial designation, which I, you know, it seems like a different kind of issue.

[00:19:59] Speaker 05:
It doesn't have anything to do with stormwater and that there might be significant stormwater issues, which is, I don't know how that rises to the level of superior knowledge on non-industrial hotspot.

[00:20:12] Speaker 00:
The contractor before the board pointed out several instances where they thought demonstrated the government's knowledge and the board said these don't show the government's knowledge.

[00:20:21] Speaker 00:
The board found that the first time the government considered to be a hot spotter of hot spot issues was after award when they were reviewing going over the designs with contractors team.

[00:20:34] Speaker 00:
So the board made that finding and said, this is the first time this pops up in the record that the government is considering it a hot spot.

[00:20:41] Speaker 00:
And there's substantial evidence for that because the things that the contractor points to to say there was some sort of pre-award knowledge are not accurate or do not exist.

[00:20:52] Speaker 00:
So that's the board's, that's the substantial evidence is that

[00:20:56] Speaker 00:
The board looked at what happened afterward and said, this is the first time it was being considered a hot spot.

[00:21:01] Speaker 00:
And I would also point out that Mason and Hanger stated in its proposal that they were very familiar with the installation, including stormwater requirements.

[00:21:11] Speaker 00:
And they actually said that the use of their infiltration areas would meet the stormwater requirements.

[00:21:16] Speaker 00:
the Virginia Department of Environmental Quality.

[00:21:19] Speaker 00:
So if the contractor is telling the government our design is going to meet Virginia's requirements, I don't know how you could they can now say that they had no idea this could possibly be considered a hot spot or they're just relying on the idea that Virginia would not treat it differently from some other project and that's not the government's responsibility.

[00:21:38] Speaker 00:
That's on the contractor.

[00:21:39] Speaker 01:
So would you say that if there's a construction factor that's well known in the industry or

[00:21:47] Speaker 01:
that it cannot be a superior knowledge issue.

[00:21:51] Speaker 00:
I mean, I believe that's covered by this court's decision in Giesler and also H&N Bailey.

[00:21:56] Speaker 00:
If it's something that's, for example, in Giesler, the contract said, you know, we need these mixed nuts, and it had some sort of code that just wouldn't be understandable to, you know, you or me.

[00:22:07] Speaker 00:
But people in the nut industry would know that's supposed to be a certain mix of peanuts with a certain amount of each kind of nut.

[00:22:14] Speaker 00:
So anyone could go look that up,

[00:22:16] Speaker 00:
and see what's in it.

[00:22:17] Speaker 00:
And the same anyone could look at table 8.10 that Virginia publishes and says, am I building a parking lot with over 40 spaces?

[00:22:25] Speaker 00:
And if you are, then you have hot spot issues.

[00:22:28] Speaker 00:
But again, I think the solicitation really pointed out numerous times that stormwater needed to be given attention.

[00:22:37] Speaker 00:
If they're not using the word significant, that's really a value judgment or a prediction that is not covered by the permits and responsibilities clause either.

[00:22:46] Speaker 02:
is there any case law that you would point us to from this court that would help with the various positions you're putting forward today?

[00:22:53] Speaker 00:
Yes, I would say the American shipbuilders case, Giesler, H&N, Bailey, I believe McCormick.

[00:23:00] Speaker 00:
Also as a comparison, for example, the Helene Curtis case, where the court did find superior knowledge.

[00:23:07] Speaker 00:
It's a patentable chemical.

[00:23:08] Speaker 00:
The government was the one that, the government really was the only company, not company, entity that knew how to make this

[00:23:14] Speaker 00:
disinfectant mix.

[00:23:16] Speaker 00:
The contractor had no way of figuring that out because they didn't know how to make this stuff through this method that existed.

[00:23:23] Speaker 00:
The government was the only one that knew that.

[00:23:25] Speaker 00:
That's different than cases where the knowledge is available from an outside source.

[00:23:30] Speaker 00:
And anyone in the industry that's experienced should be able to find that.

[00:23:35] Speaker 00:
And also, I think Giesler, I said, and McCormick.

[00:23:38] Speaker 00:
I think I listed them.

[00:23:40] Speaker 00:
But again, the superior knowledge doctrine is really about unavailable information.

[00:23:47] Speaker 00:
H&M Bailey says, the government has no duty to volunteer information if the contractor can reasonably expect it to seek and obtain the facts elsewhere.

[00:23:57] Speaker 00:
So if there's no superior knowledge, then Bell-Heary controls here.

[00:24:01] Speaker 00:
The Permits and Responsibilities Clause put it on the contractor to comply with the permitting.

[00:24:08] Speaker 00:
Even if the state agency is being inconsistent or acting in a way they don't expect, there's nothing in the contract that removes that responsibility from the Permits and Responsibilities Clause and puts it back on the government.

[00:24:20] Speaker 00:
And that's Bell-Heary.

[00:24:21] Speaker 00:
So if there's no further questions, then this court should affirm the board.

[00:24:26] Speaker 00:
Thank you.

[00:24:41] Speaker 04:
So I'd like to just address a couple of things that the council raised.

[00:24:44] Speaker 04:
So in terms of knowing that this was a hot spot, clearly that's not the case because ACC, which, by the way, has built 30 of these facilities, has built 10 of them for the Corps.

[00:24:56] Speaker 04:
Now granted, none of those are in Virginia, but no state has ever designated one as a stormwater hot spot that required any additional concern.

[00:25:03] Speaker 04:
Mason and Hanger designed to spot a site like this on Fort A.P.

[00:25:07] Speaker 04:
Hill, subject to DEQ regulations.

[00:25:09] Speaker 01:
But this is a non-industrial hot spot.

[00:25:13] Speaker 04:
The hotspot or non-industrial hotspot, none of them have been designated any kind of a hotspot.

[00:25:17] Speaker 01:
But there is a difference, isn't there?

[00:25:19] Speaker 04:
There's a difference in degree.

[00:25:21] Speaker 04:
That's right.

[00:25:22] Speaker 04:
But if ACC had known that there was any kind of hotspot consideration, it would have reconsidered the way that it made its proposal.

[00:25:29] Speaker 01:
Why not the parking lot situation?

[00:25:33] Speaker 01:
You know it's a parking lot, and there's special rules for parking lots for 400 vehicles, and you're building one for 900.

[00:25:43] Speaker 04:
Well, Table 8.10 is a small snapshot of the entire requirement.

[00:25:48] Speaker 04:
That requirement is multiple pages long.

[00:25:51] Speaker 04:
It has a lot of instructions about how to apply Table 8.10.

[00:25:55] Speaker 04:
And if you look, Table 8.10 is titled Potential Hotspot Uses.

[00:26:00] Speaker 04:
Potential.

[00:26:01] Speaker 04:
And so ACC's designer had done this before.

[00:26:04] Speaker 04:
And it had looked at Table 8.10 and it said, we did this in the past.

[00:26:07] Speaker 04:
It didn't exactly fit in here.

[00:26:09] Speaker 04:
It's not just a parking lot.

[00:26:11] Speaker 04:
It has other portions of the facility.

[00:26:13] Speaker 04:
And so DEQ applied its regulations, and it wasn't a hot spot.

[00:26:18] Speaker 04:
So we believe this time it will be a similar determination, because the facts are effectively the same.

[00:26:24] Speaker 01:
So this idea that it's immediately... That's Virginia that's controlling that information and that decision.

[00:26:30] Speaker 04:
Well, it's Virginia that's controlling that decision, but the government, we believe, clearly understood something, that this site was going to be somehow special, that it was going to require... They used the use of the word significant?

[00:26:41] Speaker 05:
in the reference to industrial in a way that was used not relating to stormwater at all?

[00:26:47] Speaker 05:
That's the only evidence you've cited to us that the government knew about how Virginia would apply its regulations.

[00:26:54] Speaker 04:
That's correct, Your Honor.

[00:26:57] Speaker 05:
So I don't believe that the... There's no evidence that the government knew specifically what Virginia would do here, right?

[00:27:07] Speaker 04:
I don't believe so, no.

[00:27:09] Speaker 04:
But I also don't think that the characterization of the industrial designation is completely divorced from the idea of stormwater management.

[00:27:18] Speaker 04:
Like I said, it was passed on to the Corps for use in its planning.

[00:27:21] Speaker 04:
And also, the legend on there is all things that would be considered environmental issues.

[00:27:27] Speaker 04:
Paving, unpaving, stormwater, wetlands.

[00:27:32] Speaker 04:
It doesn't have sort of residential and all this other stuff.

[00:27:35] Speaker 04:
That's what the legend says.

[00:27:36] Speaker 04:
So my time is up.

[00:27:38] Speaker 04:
Thank you very much.

[00:27:39] Speaker 01:
Okay, we thank you.

[00:27:40] Speaker 01:
That concludes our argument for this morning.