GOOGLE, INC. et al v. USA

Filing 72

AGREED UPON REDACTED RESPONSE to Defendant's Motion To Terminate The Stay Of Proceedings, Dissolve The Court's Preliminary Injunction, And Issue A Schedule To Resume Briefing On The Merits Of The Case, filed by GOOGLE, INC., ONIX NETWORKING CORPORATION. (Nucci, Katherine) Modified on 4/21/2011 to indicate this is a redacted document. (dls).

IN THE UNITED STATES COURT OF FEDERAL CLAIMS
Bid Protest
)
)
)
)

GOOGLE, INC.,
and
ONIX NETWORKING CORPORATION,

Plaintiffs,

v.

THE UNITED STATES,
Defendant,

AGREED-TO PUBLIC VERSION

)
)
)
)
)
)
)
)
)
)
)
)

No. 10-743 C

(Judge Braden)

)
)
)
)

and
SOFTCHOICE CORPORATION,
Defendant-Intervenor.

)
)
)

Plaintiffs' Response To Defendant's Motion To Terminate The Stay
Of Proceedings, Dissolve The Court's Preliminary Injunction,
And Issue A Schedule To Resume Briefing On The Merits Of The Case
Timothy Sullivan
1909 K Street, N.W., 6th Floor
Washington, D.C. 20006
[phone] (tel.)
[phone] (fax)
Attorney of Record for Plaintiffs Google, Inc.
and Onix Networking Corporation
Of Counsel:
Katherine S. Nucci
Scott F. Lane
Kathleen E. Kraft
Thompson Cobum LLP
Dated: April 8, 2011
5324735.1

TABLE OF CONTENTS
THE SUH DECLARATION AND ATTACHMENTS DO NOT
ADEQUATELY ADDRESS OR RESOLVE THE COURT'S
CONCERN THAT MS. SUH, AS THE ASIPMB, WAS LEGALLY
AUTHORIZED TO SIGN THE STANDARDIZATION DECISIONS

The Declaration And Attachments Establish That Ms. Sub Is
Neither The Contracting Officer Nor The Senior Procurement
Executive

3

The Declaration And Attachments Do Not Establish That Ms.
Sub's Responsibilities And Authority Encompassed
Establishing Standards For Messaging, Collaboration Or
Office Automation And Systems Management Software

5

Nothing In The Motion To Dissolve Or In The Sub Declaration
Establishes A Reporting Relationship From The CIO To The
ASIPMB

6

DEFENDANT ERRONEOUSLY ASSERTS THAT THE
STANDARDIZATION DECISIONS ARE MERELY POLICY
DECISIONS AND ARE NOT SUBJECT TO THE REQUIREMENTS
OF FAR SUBPART 6.3

7

SIGNIFICANT GAPS IN THE RECORD REMAIN UNRESOLVED

13

CONCLUSION

5324735.1

3

17

TABLE OF AUTHORITIES

Cases
Corel Corp.

United States,

v.

Distributed Solutions, Inc.
Eastman Kodak Co.

v.

v.

165 F.Supp.2d 12 (D.D.C. 2001)

United States, 539

10, 11, 12

F.3d 1340 (Fed.Cir. 2008)

Image Technical Services, Inc., 504

11

U.S. 451, 112 S.Ct. 2072,

119 L.Ed.2d 265 (1992)

Ezenia!, Inc.

v.

United States,

15

Google, Inc. and Onix Networking Corporation

Corporation,
OTIAm,, Inc.

v.

12

80 Fed.C1. 60 (2008)
v.

United States and Softchoice
passim

95 Fed.C1. 661 (2011)

United States,

Pub. Warehousing Co. KS.C.

68 Fed.C1. 108 (2005)
v.

Def Supply Ctr. Phila.,

12

489 F.Supp.2d 30 (D.D.C.
12

2007)
(5th
Rapides Regional Med. Ctr. v. Secretary, Dep 't of Veterans 'Affairs, 974 F.2d 565
Cir. 1992), cert. denied, 508 U.S. 939, 113 S.Ct. 2413, 124 L.Ed.2d 636 (1993)

Savantage Financial Services, Inc.

v.

United States,

81 Fed.C1. 300 (2008)

Savantage Financial Services, Inc.

v.

United States,

86 Fed.C1. 700 (2009),

F.3d 1282 (Fed.Cir. 2010)

11, 12

9, 10, 11,

13

aff'd, 595
10

Statutes and Regulations
28 U.S.C.

§

1491(b)

11

41 U.S.C. § 253(f)(1)(A)

3

41 U.S.C. § 253(f)(1)(B)(iii)

3

41 U.S.C.

§

3304(e)(4)(B)

41U.S.C.403

8

10,11

403(2)

9, ii

41U.S.C.3300

11

41 U.S.C.

§

FAR

(48 C.F.R.) 6.3

FAR

(48 C.F.R.) 6.3 02-1

2

FAR (48 C.F.R.) 6.302-5

8

FAR

(48 C.F.R.) 6.302-5(a)(2)(ii)

8

FAR

(48 C.F.R.) 6.302-5(c)(3)

8

5324735.1

2, 7, 9

FAR (48 C.F.R.) 6.303-2

2

FAR (48 C.F.R.) 6.3 04

2

FAR (48 C.F.R.) 6.3 05

2

FAR (48 C.F.R.) 8.405-6

10

IN THE UNITED STATES COURT OF FEDERAL CLAIMS
Bid Protest

)
)

GOOGLE, INC.,

)
)
)
)

and
ONIX NETWORKING CORPORATION,

Plaintiffs,
v.

THE UNITED STATES,
Defendant,

and
SOFTCHOICE CORPORATION,

Defendant-Intervenor.

)
)
)
)
)
)
)

AGREED-TO PUBLIC VERSION

No. 10-743 C

(Judge Braden)

)
)
)
)
)
)
)
)
)
)

Plaintiffs' Response To Defendant's Motion To Terminate The Stay
Of Proceedings, Dissolve The Court's Preliminary Injunction,
And Issue A Schedule To Resume Briefing On The Merits Of The Case
Plaintiffs Goàgle, Inc. ("Google") and Onix Networking Corporation ("Onix") hereby

submit their Response to Defendant's Motion to Terminate the Stay of Proceedings, Dissolve the

Court's Preliminary Injunction, and Issue a Schedule to Resume Briefing on the Merits of the
Case (the "Motion to Dissolve"), dated March 4, 2011. Plaintiffs oppose Defendant's Motion to

Dissolve on the grounds that (i) Defendant failed to establish that the Department of the

Interior's ("DOT") Assistant Secretary for Policy, Management and Budget ("AS/PMB") was the

5324735.1

appropriate agency official with authority to execute the two July 15, 2010 Standardization
"Determination and Findings" documents ("Standardization Decisions") and (ii) the two
Standardization Decisions constituted procurement decisions, and not internal policy decisions,
that failed to comply with the requirements of Federal Acquisition Regulation ("FAR") Subpart
6.3, 48 C.F.R.

§

6.302-1, 6.303-2, 6.304 and 6.305.'

Defendant's proposed briefing schedule has been rendered moot by the passage of time
and the Court's direction that this Response be filed by April 9, 2011. Finally, with respect to
the Court's concerns expressed in its January 3, 2011 Memorandum Opinion And Order Issuing

A Preliminary Injunction (the "Memorandum Opinion" or "Mem. Op."), Google, Inc. and Onix

Networking Corporation

v.

United States and Sofichoice Corporation, 95 Fed.Cl. 661(2011),

that the Administrative Record ("AR") appears to be incomplete, Defendant submitted with the
Motion to Dissolve a declaration from Ms. Rhea Suh, the AS/PMB, (the "Suh Declaration") and
429 pages of documents. Defendant also requested leave from the Court to refile the AR, which

had been returned to Defendant after the Memorandum Opinion was issued (and in accordance
with COFC Rule 52.2(c)), but the Court has not yet granted Defendant's request. Accordingly,
while the record still appears to, be incomplete on the basis of the documents submitted with the
I

Defendant-Intervenor Softchoice Corporation filed a similar Motion to Dissolve on March 15,
2011 in which it joined Defendant's Motion to Dissolve and reiterated its arguments, made in
Softchoice's November 19, 2010 Motion to Dismiss and.December 17, 2010 Reply
Memorandum, that the Court lacks subject matter jurisdiction over this lawsuit. Softchoice again
focused its argument on the RFQ issued on August 30, 2010, and ignored the fact that Plaintiffs
challenge the improper and unjustified sole-source procurements effected by the DOT's
Standardization Decisions. In the Memorandum Opinion, the Court effectively rejected
Softchoice' s arguments, correctly finding that "the fact that neither individual plaintiff submitted
a bid in response to the RFQ No. 503786, which was only the last step in this procurement, is not
dispositive of the standing of either." Google, Inc. and Onix Networking Corporation v, United
States and Softchoice Corporation, 95 Fed.C1. 661, 674 (2011). Plaintiffs concur with the
Court's reasoned decision regarding their standing to bring this action, and respectfully request
that the Court deny Softchoice's Motion to Dissolve. On the other hand, Plaintiffs do not oppose
Softchoice's Motion for Leave to Re-file Previously Dismissed Filings, also filed on March 15,
2011.

2

Motion to Dissolve, Plaintiffs cannot yet assess whether the AR to be refiled by Defendant will
fill all the gaps noted by the Court in its Memorandum Opinion.

THE SUH DECLARATION AND ATTACHMENTS DO NOT ADEQUATELY
ADDRESS OR RESOLVE THE COURT'S CONCERN THAT MS. SUH, AS THE
AS/PMB, WAS LEGALLY AUTHORIZED TO SIGN THE STANDARDIZATION
DECISIONS
In its Memorandum Opinion, the Court expressed concern that Ms. Suh, the AS/PMB,

lacked the requisite authority to sign the Standardization Decisions on three grounds: (i) Ms.
Suh is not the Contracting Officer or the Department's "senior procurement executive;"2 (ii) Ms.

Suh's responsibilities do not include "the establishment of a 'Department-wide standard for
messaging and collaboration' and a 'Department-wide standard for Office Automation and
Systems Management Software" [95 Fed.Cl. at 6761; and (iii) Ms. Suh's "approval" of the

Standardization Decisions circumvented the line of authority from the Chief Information Officer

("CIO") to the Secretary of the DOT or his deputy, and in fact reversed the roles of the AS/PMB
and the ClO. The Motion to Dissolve, Ms. Suh's declaration and the documents attached to her

declaration do not adequately address or resolve these concerns.
A.

The Declaration And Attachments Establish That Ms. Suh Is Neither The
Contracting Officer Nor The Senior Procurement Executive

The documents attached to Ms. Suh's declaration establish that Ms. Suh is neither the

"Contracting Officer" nor the "Senior Procurement Executive.' First, Ms. Suh is not the
Contracting Officer responsible for the DOI's Request for Quotations No. 503786 (the "RFQ")
to provide hosted email and collaboration services. Nancy Moreno is the contracting officer for

2

As the Court noted, both of the Standardization Decisions are "quintessential 'non-competitive
procedure[s],' that must be justified by the 'contracting officer.' 41 U.S.C. § 253(f)(1)(A). . . [and
because] these Standardization 'Determinations and Findings' concern an amount exceeding $50
senior procurement executive of
million (AR 753), they require the additional approval of
the agency.' 41 U.S.C. § 253(f)(1)(B)(iii) (emphasis added)." 95 Fed.Cl. at 676.

'i

3

this procurement. See D&A 67, DOl's Acquisition Plan for procuring a DOl Messaging
Solution, dated July 13, 2010, and signed by Nancy Moreno as Contracting Officer.
Second, Ms. Suh is not the DOl's Senior Procurement Executive. Ms. Debra Sonderman,

the current Director of the Office of Acquisition and Property Management (the "OAPM

Director"), is the DOT's Senior Procurement Executive. According to the DOT's documents,
however, the OAPM Director did not hold that additional role in July 2010 when the

Standardization Decisions were executed. See D&A 45-47, DOl Departmental Manual ("DOI
Manual"), Part 112, Ch. 11,

§

11.3 (eff. 11/30/10).

ThepreviousversionofPart 112, Chapter 11,

dated December 17, 1997, which was not provided by Defendant in support of the Motion to

Dissolve, specifically removed the reference to the OAPM Director as the DOl's "Procurement

Executive" that had been included in the 1996 version of Part 112, Chapter 11. Cf DOT Manual,
Part 112, Ch. 11,

§ 11.3

(no mention that the OAPM Director serves as the DOT's Senior

Procurement Executive or Procurement Executive) (eff. 12/17/97), available at

http://elips.doi.gov/app_DM/act_getfiles.cfm?relnum3 182 (last visited 3/17/11); and DOI
Manual, Part 112, Ch. 11,

§ 3

(states the OAPM Director serves as the DOT's Procurement

Executive pursuant to Executive Order 12931) (eff. 2/9/96), available at

http://elips.doi.gov/app_DM/act_getfiles.cfm?relnum3052 (last visited 3/17/11). Thus, during
the relevant time frame (July 2010), (i) the OAPM Director was not the DOT' s Procurement

Executive or Senior Procurement Executive and (ii) the Senior Procurement Executive did not
report directly to Ms. Suh's office because, as far as Plaintiffs can discern, the direct reporting

4

relationship from the Senior Procurement Executive to the AS/PMB did not exist between
December 17, 1997 and November 30, 2010.

The Declaration And Attachments Do Not Establish That Ms. Suh's
Responsibilities And Authority Encompassed Establishing Standards For
Messaging, Collaboration Or Office Automation And Systems Management
Software

B.

Ms. Suh's responsibilities, as outlined in the DOl Manual, do not include establishing

standards for messaging, collaboration, or office automation and systems management software.
See

D&A 60-62, DOT Manual, Part 109, Ch. 4. Ms. Suh's authority only reaches as far as the

responsibilities of her position, and nothing in the produced sections of the DOT Manual assigns
Ms. Suh responsibility for standardization decisions, and particularly decisions standardizing

information technology software and systems, within the DOT.
The DOI Manual does not delegate authority to Ms. Suh's office for standardization

decisions. In fact, the documents produced by the Defendant place that responsibility on the

shoulders of and give the requisite authority to the CIO -- a position that reports to the Secretary

of the Interior, not to the AS/PMB.

See

D&A 19-20, Secretarial Order 3244 dated November 12,

2002. Secretarial Order 3244 gives standardization authority to bureau and office CTOs and

Other current and superseded documents in the DOT Manual indicate that the Senior
Procurement Executive position was held by the Director of Administration, a position
previously supervised by the Deputy Assistant Secretary - Budget and Finance. See DOT
Manual, Part 112, Ch. 1, § 1.2.D (eff. 12/17/97), available at
http://elips.doi.gov/app dm/act getfiles.cfm?relnum3 180 (last visited 3/31/11), and
organization chart (eff. 10/31/00) (showing OAPM reportable to the Director of
AdministrationlSenior Procurement Executive, which was reportable to the Deputy Assistant
Secretary Budget and Finance), available at
http://elips.doi.gov/app dmlact_getfiles.cfm?relnum3345 (last visited 3/31/1 1). The current
version of Part 112, Chapter 1, dated April 12, 2002, eliminates all references to the Director of
Administration and the Senior Procurement Executive. See DOT Manual, Part 112, Ch. 1,
available at http://elips.doi.gov/app dmlact_getfiles.cfm?re1nurn3396 (last visited 3/31/1 1).
None of these versions was produced with the Motion to Dissolve.

-

5

arguably permits the DOl's ClO to standardize products for the entire agency. Nothing in
Secretarial Order 3244, however, gives standardization authority to the AS/PMB.4
Secretarial Order 3309 also does not delegate standardization authority to the AS/PMB or

establish a reporting relationship from the CIO to the AS/PMB. Furthermore, even if Secretarial
Order 3309 delegated such authority or established such a relationship, Secretarial Order 3309 is
irrelevant because it was issued on December 14, 2010, five months after Ms. Suh signed the

Standardization Decisions.
Additionally, Defendant relies on DOT Manual Part 112, Chapter

11

to show that the

DOT's Senior Procurement Executive and contracting officers report to the AS/PMB, that such

offices fall within the AS/PMB's authority, and therefore that the AS/PMB could sign the
Standardization Decisions in place of either official. See D&A 45-47, DOT Manual, Part 112,

Chapter 11. Part 112, Chapter 11, in the version presented to the Court, does not apply because
it became effective on November 30, 2010 -- after the AS/PMB signed the Standardization
Decisions -- and Defendant offers no other evidence to prove a delegation of standardization

authority to the AS/PMB.
C.

Nothing In The Motion To Dissolve Or In The Suh Declaration Establishes A
Reporting Relationship From The ClO To The AS/PMB

The Motion to Dissolve and the Suh Declaration fail to establish a reporting relationship

running from the CIO to the AS/PMB and otherwise do not allay the Court's concern that Ms.

Suh's execution of the Standardization Decisions circumvented the Office of the Secretary. In
Secretary Norton issued Secretarial Order 3244 in 2002, and according to Section 7 thereof,
DOI was instructed to incorporate the provisions of Order 3244 into the DOI Manual within six
months. As far as Plaintiffs can tell, this incorporation never occurred. And because Secretarial
Orders are insufficient to accomplish permanent delegations of authority, it is unclear, at best,
whether even the DOT CIO had the authority to approve standardization decisions. See DOI
Manual, Part 200, Ch. 1, § 1.3, available at http://elips.doi.gov/elips/release/3373.htm (last
visited 3/16/li); DOI Manual, Part 012, Ch. 1, § 1.1, available at
http ://elips.doi. gov/app dm!act getfiles.cfm?re1num2948 (last visited 3/17/11).

6

fact, Defendant's only explanation for why the two Standardization Decisions did not circumvent

the Office of the Secretary and did not reverse the roles of the AS/PMB and the ClO is that the
AS/PMB provides "administrative support and guidance" to the CIO (a fact of which the Court
was well aware [95 Fed.C1. at 677]). Defendant, however, does not explain how the provision of

administrative support and guidance establishes a reporting relationship that justifies Ms. Suh's
exercise of the ClO' s purported standardization authority [see note 4 above] or otherwise alters
the clearly delineated reporting relationship running from the CIO to the Office of the Secretary.

In summary, Defendant has failed to dispel the concerns expressed by the Court

regarding the authority of Ms. Suh to approve the Standardization Decisions. Indeed,

Defendant's sole basis for its assertion that the "Senior Procurement Executive, Ms. Debra
Sonderman, as well as any DOl contracting officers, report directly to Ms. Suh's office and are
properly considered to fall within her authority, as delegated by the Secretary and established by
Department Manuals" [Motion to Dissolve, pp. 8-9] is a version of DOT Manual Part 112,
Chapter

11

that did not exist when the Standardization Decisions were signed. Thus,

Defendant's penultimate conclusion that Ms. Sub's signing of the Standardization Decisions in
place of the ClO, a contracting officer, or the DOT's Senior Procurement Executive was "well

within her authority and legally permissible" is fundamentally flawed.

II.

DEFENDANT ERRONEOUSLY ASSERTS THAT THE STANDARDIZATION
DECISIONS ARE MERELY POLICY DECISIONS AND ARE NOT SUBJECT
TO THE REQUIREMENTS OF FAR SUBPART 6.3
Defendant takes issue with the Court's ruling that the Standardization Decisions are

"quintessential 'non-competitive procedure[s]" [95 Fed.Cl. at 676], and posits both factual and
legal arguments to support its position that the Standardization Decisions were policy decisions
and not procurement decisions subject to FAR Subpart 6.3. Defendant's arguments are

unavailing.

7

First, relying on 41 U.S.C.
§

§

3304(e)(4)(B), which is the re-codification

of4l u.s.c.

253(f)(2)(B), Defendant contends that the Standardization Decisions are exempt from the

competition in Contracting Act ("CICA") requirements for a properly-authorized justification
and approval because the "DOT seeks to procure a brand-name commercial item authorized for

resale on the GSA Federal Supply Schedule." Motion to Dissolve, p. 7. This CICA exception,
however, was not intended to apply to agency purchases against the GSA Federal Supply
Schedule. The exception at subsection 253(f)(2)(B) was added to CICA by P.L. 99-145,
§

961(a)(2), and House Conference Report No. 99-235 made only one reference to the exception,

describing it as a provision to "exempt from the requirement to justify in writing use of a solesource exemption to purchase of brand-name commercial items purchased for resale in

commissaries and ships stores." See also Senate Report No. 98-297, p. 5, referencing the

Committee of Armed Services' expansion of CICA's authority to use noncompetitive procedures
"to apply in those cases in which the need is for a brand-name commercial item for authorized

resale" and stating "[t]his addition recognizes that in some situations, such as soft drink boftling,
there may be only one source of supply."

FAR 6.302-5 confirms the meaning of this statutory exception. Subsection (a)(2)(ii)
provides that full and open competition need not be provided when "the agency's need is for a
brand name commercial item for authorized resale," and subsection (c)(3) states as follows:
(3) The authority in (a)(2)(ii) of this subsection may be used only
for purchases of brand-name commercial items for resale through
commissaries or other similar facilities. Ordinarily, these
purchases will involve articles desired or preferred by customers of
the selling activities (but see 6.301(d)).

(emphasis added). Quite unlike a government commissary's or similar facility's purchases of
specific brands of soft drinks, chips or candies for resale to their patrons, the DOl's decisions to

8

standardize to and purchase only Microsoft's BPOS-Federal and other products are not for the
purpose of reselling those products to DOl customers. The exemption upon which Defendant

relies clearly has no applicability in this case.
Second, Defendant has strained mightily, but unsuccessfully, to construe pertinent cases
as supporting Defendant's contention that the DOl's Standardization Decisions are not

procurement decisions subject to the requirements of FAR Subpart 6.3. Motion to Dissolve, pp.
9-13. In an attempt to distinguish the facts in Savantage Financial Services, Inc.

v.

United

States, 81 Fed.Cl. 300 (2008), in which the court struck down a brand name justification as

violating CICA and the requirements of FAR Subpart 6.3, Defendant argues that the justification
in Savantage was "a procurement document with a direct, unmediated effect on acquisitions"

whereas the DOl produced two distinct documents. The first was the DOl's BPOS-Federal
standardization decision, which Defendant characterizes as a "statement of departmental policy,"
and the second was the DOl's Limited Source Justification, dated August 30, 2010, which

Defendant agrees was a procurement document. This distinction is without a difference,
however, because the court in Savantage premised its decision on its determination that the

justification selecting two vendors' systems for purposes of consolidating all financial
management systems used by the Department of Homeland Security's 22 components

constituted a procurement as defined at 41 U.S.C.

§

403(2). Id. at 304-05. Here, the DOl's

Standardization Decisions clearly fall within the statutory definition of "procurement" because
(i) they reflect the agency's determination of a need for a consolidated messaging solution based

on cloud computing technology, as well as for specified Microsoft products, and (ii) the DOT

selected the Microsoft BPOS-Federal and other products as the only solution and software
The statute defines the term "procurement" to encompass "all stages of the process of
acquiring property or services, beginning with the process for determining a need for property or
services and ending with contract completion and closeout."

9

available to meet those needs.6 The DOl's Limited Source Justification is no more than a

reaffirmation of the procurement decisions made on July 15, 2010 that was necessitated not only
by FAR 8.405-6, but also by the DOl's realization that the StandardizatiOn Decision selecting
BPOS-Federal did not comply with FAR 8.405-6.
The decision of the U.S. District Court for the District of Columbia in Corel Corp.

v.

United States, 165 F.Supp.2d 12 (D.D.C. 2001), also does not support Defendant's position.
While the facts are somewhat similar in that the Department of Labor ("DOL") determined to
standardize to Microsoft products for word processing and other functions and then proceeded to
obtain quotes from Microsoft resellers under existing IDIQ contracts in order to purchase the

products, the fundamental difference rests upon the District Court's conclusion that a
"procurement" is "the process by which the government pays money or confers other benefits in
order to obtain goods and services from the private sector." Id. at 24, citing Rapides Regional
Med. Ctr.

v.

Secretary, Dep 't of Veterans 'Affairs, 974 F.2d 565, 573 (5th Cir. 1992), cert.

denied, 508 U.S. 939, 113 S.Ct. 2413, 124 L.Ed.2d 636 (1993). More importantly, the District

Court relied on the Fifth Circuit's rejection of the definition of "procurement" in 41 U.S.C.

§

403

on the basis that the definition was found in Chapter 7 of Title 41, which is the Office of Federal
Procurement Policy Act and, according to the Fifth Circuit, was inapplicable to CICA. Id. at
6

Contrary to Defendant's arguments [Motion to Dissolve, p. 11], the circumstances in the
second Savantage protest are inapposite. After losing the first protest, the DHS issued a new
solicitation for a pre-integrated financial, acquisition and asset management system without
specifying any products or solutions by name, and Savantage challenged the terms of that
solicitation as being unduly restrictive of competition. Savantage Financial Services, Inc. v.
United States, 86 Fed.C1. 700 (2009), aff'd, 595 F.3d 1282 (Fed.Cir. 2010). The "internal
documents" that DHS relied on in determining its need for a pre-integrated system were market
research materials, such as lessons learned from earlier DHS attempts to consolidate its financial
management systems and analyses of other agency acquisitions of financial management
systems. 86 Fed.C1. at 705-06. They were not documents reflecting DHS's selection of a
specific product or software solution and are, thus, in no way comparable to DOl's
Standardization Decisions.

573. The District Court therefore held that CICA "has no application to government decisions

which do not involve the actual purchase of a good or service. . .." Corel, supra, 165 F.Supp.2d
at 24.

The reasoning of the Fifth Circuit in Rapides, adopted by the District Court in Corel, has

not been followed by the Federal Circuit or this court. See Distributed Solutions, Inc.

v.

United

States, 539 F.3d 1340, 1345 (Fed.Cir. 2008) (holding that it is appropriate to adopt the definition

of "procurement" at 41 U.S.C. § 403(2) to determine whether a procurement has occurred
pursuant to 28 U.S.C.

§

1491(b)); Savantage, süpra, 81 Fed.Cl. at 304, citing OTIAm., Inc.

United States, 68 Fed.Cl. 108, 114 (2005), and Pub. Warehousing Co. KS.C.

v.

v.

Def Supply Ctr.

Phila., 489 F.Supp.2d 30, 38 (D.D.C. 2007). Thus, Defendant's attempt to draw parallels
between this case and the Corel decision, i.e., that the Standardization Decisions are written

policy documents separate from the subsequent acquisition of the software via a legitimate
procurement method, fails because relevant precedent establishes that the Standardization
Decisions were procurements subject to the requirements of CICA and FAR Subpart 6.3.
Finally, Defendant's reliance upon this court's decision in Ezenia!, Inc.

v.

United States,

80 Fed.Cl. 60 (2008), is misplaced. In Ezenia!, the Army decided to standardize to an Adobe

software product based upon a competitive process and "Best of Breed" evaluation, and then
proceeded to purchase the software using the Federal Supply Schedule. Id. at 63. The court
In addition to pointing out that the U.S. District Court for the District of Columbia, in its later
decision in Pub. Warehousing Co. KS.C. v. Def Supply Ctr. Phila., supra, declined to follow the
reasoning in its earlier Corel decision regarding the applicability of the 41 U.S.C. § 403(2)
definition of "procurement" in CICA cases, we note that the re-codification of CICA at 41
U.S.C. § 3300 et seq. includes both a definition of "acquisition" and of "procurement." Section
111 in P.L. 111-350 provides that "procurement includes all stages of the process of acquiring
property or services, beginning with the process for determining a need for property or services
and ending with contract completion and closeout." Thus, the reasoning of the Rapides court,
adopted by the Corel court, for holding that the definition of "procurement" contained in the
OFPP Act was inapplicable to CICA no longer has any validity.

rejected Ezenia's protest for lack ofjurisdiction because the Army's standardization decision was
not a procurement decision falling within the court's bid protest jurisdiction. Id. Just as the
Savantage

court distinguished the facts in Ezenia! because there was no competitive process

resulting in the brand name justification

[Savantage, supra, 81

Fed.Cl. at 305], the facts here are

distinguishable because the Standardization Decisions were not the result of a competitive
process. In addition, and again like the situation in Savantage, the DOT clearly intended to

"knock out" Google (and all the other vendors with competing products that were allegedly
reviewed by the DOT's market research support contractor) when it issued the Standardization
Decisions. The DOl's issuance of the RFQ specifying the Microsoft BPOS-Federal product
attests to that fact.

See Savantage, supra, 81

Fed.Cl. at 305 ("The fact that DHS issued the

TASC solicitation for services to support the transition to Oracle and SAP indicates that such a

determination [to purchase Oracle and SAP financial management system licenses] was made.").
Further, contrary to Defendant's assertion, the DOI's decision to standardize to the Microsoft

products was not driven by any failings or representations on Google's part - the record
establishes that the DOl made that decision in mid-2009, as evidenced by the DOI's Project Plan
and related documentation in the record.
In sum, Defendant has failed to demonstrate that the Standardization Decisions were not

procurements, i.e., they identified the DOI's need for software products and a cloud-based

messaging solution, that were quintessentially non-competitive, i.e., they designated Microsoft
products to satisfy the DOl's needs. As non-competitive procurements, the Standardization
Decisions were required to meet the requirements of FAR 6.303 and 6.304. Defendant's Motion
to Dissolve makes no attempt to demonstrate compliance with FAR 6.303 and, as discussed

above, Defendant has failed to show that Ms. Suh was the appropriate DOl official to approve

the Standardization Decisions.

III.

SIGNIFICANT GAPS IN THE RECORD REMAIN UNRESOLVED
In its Memorandum Opinion, the Court expressed concerns regarding materials that were

absent from the original AR. 95 Fed.Cl. at 679-80. Although the new AR to be filed by
Defendant may address these concerns in more detail, Defendant's Motion to Dissolve only cites

to documents attached to the Suh Declaration and those previously included in the AR to respond
to some of the gaps in the record identified by the Court. Specifically, Defendant addressed

whether the DOl considered the embedded costs of organizational lock-in; and whether the Dell

contract modification, implementing the pilot project, was within that contract's scope. To the
extent that Defendant believes the 429 pages of materials submitted with the Motion to Dissolve
have resolved these two concerns, Plaintiffs disagree. As described below, the attachments do

not reflect any meaningful discussion or consideration of the embedded costs associated with the
DOT's degree

of organizational lock-in resulting from the implementation of the Standardization

Decisions. Similarly, the Dell contract that was included with the declaration is missing key

attachments that apparently list the Microsoft licenses that defined the contract's scope.
Defendant argues that the Court's concerns about whether the DOT considered the

embedded costs of organizational lock-in are resolved by the fact that the BPOS-Federal contract
would incorporate termination provisions. Motion to Dissolve, p. 16. The cited termination
provisions would require Microsoft to cooperate with the DOT in any efforts to migrate DOT data
to another service provider, although these provisions did not establish pricing for any such
transitional support. AR 823, Tab 24. This argument demonstrates that Defendant

misunderstands the Court's fundamental concern about organizational lock-in. The Court was

not so much troubled by the issue of data portability, but rather by the concern that the more
Microsoft products an organization uses, the more reliant it will become on all of Microsoft's

products and services.8 It logically follows that once organizational lock-in is achieved, future
software purchases are pre-defined; full and open competition for product selection is no longer

available; the organization loses bargaining power; and the organization loses the option to
incorporate new technology or products without incurring substantial costs. See AR 651, Tab
14DD

);

AR 251, Tab 141 (same); AR 677, Tab 14GG

).

As Figure 2 from
demonstrates, the BPOS-Federal procurement would apparently increase the DOl's

AR 652, Tab 14DD.

Even if data portability were the only concern, without transition pricing terms, the risk
remains that Microsoft will make transition of data cost prohibitive. AR 823, Tab 24 ("If the
Government terminates BPOS-Federal Solutions for Convenience, then additional fees may
apply for such Transition Readiness for the Transition Period."); see also Eastman Kodak Co. v.
Image Technical Services, Inc., 504 U.S. 451, 476-77, 112 S.Ct. 2072, 119 L.Ed.2d 265 (1992)
(rejecting Kodak's contention that lock-in risks were effectively resolved by the ability of
customers to switch products, in part, because of the question of whether the costs of switching
could exceed the costs of paying "supra-competitive" prices).
8

As the Court explained in its Memorandum Opinion, none of the embedded costs of

organizational lock-in was addressed in the Standardization Decisions [95 Fed.C1. at 678], and

Defendant's Motion to Dissolve provides no evidence that the DOIhas considered or addressed
such costs.

Defendant's Motion to Dissolve also does not adequately address whether the DOl's
modification to Dell's contract to implement the pilot project was an in-scope modification.
Defendant simply asserts that "the scope of the original procurement was very broad" and that
the DOI "used this contract to purchase a wide range of Microsoft product licenses, upgrades,
and software maintenance services." Motion to Dissolve at 17. The Statement of Work,

however, suggests the contract was only intended to cover specific Microsoft product licenses:

B. Enterprise Agreement Scope of Support Provided

The EA shall provide:

Continuation of Microsoft Software Assurance
support for the Microsoft product licenses currently
held by DOl, as outlined in Attachment (1).
Purchase of new Microsoft product licenses with
Software Assurance, as outlined in Attachment (2)
Purchase of new Microsoft product licenses ("True
Up") for the products outlined in Attachment (3).
D&A 106-107 (emphasis added). This Statement of Work indicates that there were five
attachments to the Dell contract that defined what products would be considered in-scope. The
documents provided with the Motion to Dissolve do not include these attachments, do not state

that BPOS-Federal was listed or contemplated on these attachments, and do not list the other
products available for purchase on the Dell contract. Without these attachments, Plaintiffs
cannot discern whether the pilot project was actually within the scope of the Dell contract.
The Court noted several other shortcomings in the AR, and the Suh Declaration suggests

that the 429 pages produced with the Motion to Dissolve and/or the new AR have addressed, or
will address, each of those shortcomings. D&A 8,

¶ 11.

Plaintiffs question whether the DOl has

fully responded to the record gaps identified by the Court. For example, regarding the Court's

observation that the AR does not evidence that the RFQ was posted on the GSA eBuy on August
30, 2010 [95 Fed.Cl. at 671 fn.21], the DOl produced no additional documents. Instead, Ms. Suh

stated that her "staff is confident" that the right procedures were followed when posting the RFQ

and its attachments on GSA eBuy. D&A 5-6, 1[ 7. In response to the Court's comments
regarding the lack of documentation reflecting communications and meetings between DOl and
Microsoft in 2009 [95 Fed.Cl. at 679-80j, the DOT produced only (i) Mr. Jackson's notes from

meetings on September 22, 2009 (D&A 181 and 186) and on August 30, 2010 (D&A 182-85),
five e-mail exchanges from April, February, July and November 2010 (D&A 188-95), and
a few Microsoft product description and other materials (D&A 196-272, 402-3 9). With the

possible exception of the Microsoft product description materials, the DOT did not produce the

attachments to emails between DOT and Microsoft that the Court specifically said were missing.
95 Fed.Cl. at 680. Finally, in response to the Court's suggestion that the DOl seek the

independent views of outside experts as to whether a reconsideration of the Standardization
Decisions is warranted [95 Fed.C1. at 680], Ms. Suh relied on the actions of DOT officials taken

before the RFQ was issued on August 30, 2010 and, thus, made no attempt to reconsider the
Standardization Decisions in light of the Court's decision. D&A 6-7,

'J

9.

As evidenced by Defendant's Motion to Dissolve and attached documents, the DOT either

could not or would not address the Court's explicit concerns regarding the DOl's actions and the
completeness of its record. Consequently, Defendant has failed to provide an adequate basis for
the Court to dissolve the preliminary injunction.

IV.

CONCLUSION
The Memorandum Opinion identified numerous deficiencies in the DOT's process for

selecting a unified messaging solution based on cloud technology and remanded the procurement
to the DOI "for additional investigation or explanation." 95 Fed.Cl. at 680. During the

injunction period, the Court anticipated that "the Secretary of the Department of the Interior will
have an opportunity to correct the deficiencies herein cited, with the advice of the Solicitor and
the Inspector General." Id. The only thing the DOI did in its Motion to Dissolve was to tell the
Court that (i) the Court's decision was wrong, (ii) there were no deficiencies in the DOT's

procurement processes, and (iii) further investigation or explanation by the DOI was
unnecessary.

Based on the foregoing, Plaintiffs very much disagree with Defendant's contentions that
Ms. Suh, as the DOT's AS/PMB, was the proper official to approve the Standardization

Decisions; that the Standardization Decisions were not procurements subject to the requirements

of CICA and FAR Subpart 6.3; that the DOT has provided full and accurate responses to the
Court's concerns; and that the

DOT has

produced a complete administrative record. Accordingly,

Plaintiffs respectfully request that the Court deny Defendant's Motion to Dissolve.
Respectfully submitted,

Is! Timothy Sullivan
Timothy Sullivan
1909 K Street, N.W., 6th Floor
Washington, DC 20006
[phone] (tel.)
[phone] (fax)

Attorney of Record for Plaintiffs Google,
Inc. and Onix Networking Corporation

Of Counsel:
Katherine S. Nucci
Scott F. Lane
Kathleen B. Kraft
Thompson Coburn LLP
Dated: April 8, 2011

CERTIFICATE OF SERVICE
I

hereby certify that on this 8th day of April, 2011, a copy of the foregoing "Plaintiffs'

Response To Defendant's Motion To Terminate The Stay Of Proceedings, Dissolve The Court's

Preliminaiy Injunction, And Issue A Schedule To Resume Briefing On The Merits Of The Case"

was filed electronically. I understand that notice of this filing will be sent to all parties by
operation of the Court's electronic filing system. Parties may access this filing through the

Court's system.

Is! Timothy Sullivan