Logistics Modernization Program

United States

CSC settles claims of over US$2 billion with the U.S. Army on the Logistics Modernization Program

Brief

Computer Sciences Corporation (CSC) won a contract in 1999 to perform the US Army’s Logistics Modernization Program (LMP). In accordance with the Army’s intent to conform to commercial best practices, CSC and the Army intended to use commercial off-the-shelf (COTS) products with minimal specialization to streamline and modernize the Army’s logistics systems. However, due to the size and extreme complexity of the Army’s logistics systems, the LMP system became highly specialized.

The unanticipated customizations led to significant delays and cost overruns on the contract, which resulted in CSC filing 14 claim appeals before the Armed Services Board of Contract Appeals (ASBCA). The US Army in turn filed a counterclaim against CSC, leading to claims in total in excess of US$2 billion.

What we did

HKA was retained by CSC’s counsel to provide expert analysis and opinions regarding CSC’s claims. HKA reviewed all of CSC’s claims and REAs, as well as the DCAA audits of the claims and REAs. We authored two expert reports for the ADR: one affirmative report regarding the claim methodologies and the damages incurred by CSC, and a second expert report rebutting the DCAA audit reports of CSC’s claims.

During the ADR, HKA presented the expert quantum analysis to both parties and the mediators. HKA also assisted with analyses requested by the mediators to explain the complex quantum issues in the case and participated in break-out sessions focused on quantum.

Outcomes

The matter settled after the conclusion of the ADR, with CSC agreeing to a one-time payment of US$277 million and a five-year LMP contract extension worth approximately US$1 billion.

Project Details
  • Client
    Computer Sciences Corporation (CSC)
  • Value
    US$2 billion
  • Services
    Expert, Government Contracts
  • Sectors
    Government Contracts