SCIENCE APPLICATIONS INTERNATIONAL CORPORATION et al
Filing
76
REDACTED PUBLISHED OPINION. Signed by Senior Judge James F. Merow. (lae) Copy to parties.
In the United States Court of Federal Claims
No. 11-690 C
(Originally Filed Under Seal December 20, 2011)
(Filed Redacted January 9, 2012)
SCIENCE APPLICATIONS
INTERNATIONAL CORP.,
Plaintiff,
v.
THE UNITED STATES,
Defendant,
MISSION ESSENTIAL
PERSONNEL, LLC,
LINC GOVERNMENT
SERVICES, L.L.C.,
GLOBAL LINGUISTIC
SOLUTIONS, LLC,
NORTHROP GRUMMAN TECHNICAL
SERVICES, INC.,
CACI PREMIER TECHNOLOGY, INC.
and
L-3 SERVICES, INC.,
Intervenor Defendants.
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) Post-award bid protest; standing; contents
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Joseph G. Billings, Baltimore, MD, for plaintiff. Alfred M. Wurglitz, Rockville, MD,
Nathanael D. Hartland and Rita J. Piel, Baltimore, MD, of counsel.
Jacob A. Schunk, Commercial Litigation Branch, Civil Division, United States
Department of Justice, Washington, DC, for defendant, with whom were Tony West,
Assistant Attorney General, Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant
Director and Seth W. Greene, of counsel.
Craig A. Holman, Washington, DC, for intervenor defendant Mission Essential
Personnel, LLC. Stuart W. Turner, William S. Speros and Emma V. Broomfield, of counsel.
Sean D. Forbes, Houston, TX, for intervenor defendant Linc Government Services,
L.L.C. Bryant S. Banes, of counsel.
OPINION AND ORDER
1/
Merow, Senior Judge.
Plaintiff, Science Applications International Corp. (“SAIC”) filed this postaward protest contesting the United States Department of the Army Intelligence and
Security Command’s (“INSCOM,” “Army” or “Agency”) decision not to award an
indefinite delivery, indefinite quantity (“IDIQ”) contract to SAIC for foreign
language support services (“DLITE contract”) and to award DLITE contracts to six
other offerors. Plaintiff asserts that the Army’s evaluations of SAIC’s and other
offerors’ proposals were “irrational, arbitrary, unequal, and in violation of statutes
and regulations.” (Compl. ¶ 2, ECF No. 1.) The six awardees have intervened in this
protest proceeding.
After the Administrative Record (“AR”), ECF No. 32, was filed, SAIC filed a
motion seeking its completion. (ECF No. 33.) Oppositions to supplementing the AR
were filed. (ECF Nos. 55, 58 & 59.) The defendant and two intervenors filed
Motions to Dismiss contending SAIC cannot establish it had a substantial chance to
receive an award and therefore lacks standing. (ECF Nos. 53, 56 & 57.) SAIC
responded to the Motions to Dismiss and Replies were filed. (ECF Nos. 64-69.)
For the following reasons, the motion to supplement or complete the AR is
partially denied and the Motions to Dismiss the Complaint are denied, the denial of
the dismissal motions being without prejudice to renewal of positions therein in
subsequent motions for judgment on the AR.
Background
On December 2, 2010, INSCOM issued a Request for Proposal (“RFP”) (No.
W911W4-11-R-0003) for the provision of worldwide linguistic support for military
operations and exercises for the Department of Defense Language Interpretation and
1/
This Opinion and Order was originally filed under seal on December 20, 2011. (ECF No.
71). The parties were afforded an opportunity to propose redactions. On December 29, 2011,
plaintiff filed proposed redactions and represented that no party objected. (ECF No. 73.) The court
has adopted those redactions and accordingly is reissuing its Opinion and Order dated December 20,
2011, with the agreed redactions and some minor, non-substantive edits.
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Translation Enterprise. (AR 1-180.) In addition to “Train and Sustain” contracts
set-aside for small businesses, the Agency anticipated awarding multiple “Force
Projection,” IDIQ contracts for the “support of forces engaged in humanitarian,
peacekeeping, contingency and combat operations without a well defined timeframe
or quantity for delivery.” (AR 26, 721-22.) After award, Task Orders with a
cumulative value of up to $7.76 billion would then be competed among the selected
IDIQ contractors. (AR 3, 736.)
The source selection plan instructed selection board members not to make a
comparative analysis of proposals, rather “[e]xamine each proposal individually in
detail against the evaluation factors in [the source selection plan] and the
Solicitation.” (AR 1570.) In decreasing order of weight, the five evaluation
categories were: (1) Management, (2) Technical, (3) Past Performance, (4)
Socio-Economic, and (5) Price. (AR 946-48, 1570.) The other-than-cost factors,
when combined, were more important than cost. (AR 946.) The Management
category included the following four subfactors, also listed in decreasing order of
importance: (1) Management Plan, (2) Staffing Plan, (3) Transition Plan, and (4)
Security Plan. (AR 948-49.) The Technical category included the following
subfactors: (1) IDIQ Technical Approach, (2) Sample Task Order Charlie (“STO-C”)
Technical Approach, and (3) Quality Control Plan (“QCP”). (AR 946-50.)
The RFP required the proposal: (1) “describe the process for . . . subcontractor
management [and] . . . the assignment of responsibilities, division of work, and
reporting procedures,” (2) “[d]escribe the management approach and/or controls that
will be implemented to ensure subcontractors perform seamlessly within the
framework of the contract objectives,” (3) “[d]escribe the approach to identifying
sufficient quantity of linguists needed,” and (4) “[d]escribe the plans, processes and
procedures for controlling and reducing costs.” (AR 917-18.)
Only “acceptable” offers would be considered for an award.
To award a contract, the Government must have received an acceptable
offer. An offer is acceptable when it meets all of the material terms and
conditions of the RFP, which includes the solicitation provisions,
contract clauses, specifications, and documents, exhibits, and
attachments.
(AR 907.)
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Section M.3 instructed: “An offeror’s proposal must accurately demonstrate
an understanding of the objectives and scope of the program.” (AR 946.)
Paragraph 6 of the RFP’s Executive Summary advised that “[a]wards may be
made from the initial offers without discussions. Therefore, initial proposals should
contain the offeror’s best terms from a management, technical, past performance,
small business participation, and cost/price standpoint.” (AR 721.)
Although the RFP did not identify the ranking system to be employed for the
evaluation factors, adjectival ratings of “outstanding,” “good,” “acceptable,”
“marginal,” and “unacceptable” were to be used for all but the cost factor. (AR
1573.) A rating of “unacceptable” would be given if a proposal contained “a major
error(s), omission(s) or deficiency(ies) that indicates a lack of understanding of the
problems or an approach that cannot be expected to meet requirements and none of
these conditions can be corrected without a major rewrite or revision of the proposal.”
(Id.) “Weakness” was defined as a “flaw in the proposal that increases the risk of
unsuccessful contract performance.” (AR 2017.) A “significant weakness” was
defined as “a flaw that appreciably increases the risk of unsuccessful contract
performance.” (Id.) “Deficiency” was defined as “[a] material failure of a proposal
to meet a Government requirement or a combination of significant weaknesses in a
proposal that increases the risk of unsuccessful contract performance to an
unacceptable level.” (Id.)
INSCOM received eleven Force Projection proposals (AR 1992) which were
reviewed by the Source Selection Evaluation Board (“SSEB”). (AR 1711-43.)
Following review of the SSEB report, the source selection authority (“SSA”) and the
contracting officer awarded IDIQ contracts to: Mission Essential Personnel, LLC;
Northrop Grumman Technical Services, Inc.; L-3 Services, Inc.; Global Linguistic
Solutions, LLC; CACI Premier Technology, Inc.; and LINC Government Services,
LLC. (AR 1991-98.)
The SSA’s Source Selection Decision Document (“SSDD”) concluded SAIC’s
proposal was “technically unacceptable” and therefore not eligible for an award:
An unacceptable proposal is one that contains major errors, omissions
or deficiencies that indicates a lack of understanding of the problems or
an approach that cannot be expected to meet requirements and none of
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Technical evaluation factors – the two most important criteria – while the [bottom
five proposals] were found to be Marginal or Unacceptable under one or both the
Management and Technical evaluation factors.” (AR 1995.)
I. Plaintiff’s Motion to Complete the Administrative Record
Pursuant to the Order (ECF No. 14, filed October 19, 2011) the AR submitted
to the court contains plaintiff’s proposal and its evaluation by the Agency plus the
Agency’s evaluations of the proposals submitted by the six awardees, but does not
contain the proposals submitted by the six awardees. This occurred because several
of the awardees objected to the inclusion of their proposals in the record of plaintiff’s
protest, which is addressed to its failure to obtain an IDIQ award and does not object
to the six awards. The October 19, 2011 Order indicated that plaintiff could raise the
issue of adding the six proposals to the AR by motion and plaintiff has done so by
filing its Motion to Complete the Administrative Record (ECF No. 33).
Intervenor awardees L-3, Linc Government Services, and Mission Essential
Personnel oppose plaintiff’s motion to include the awardees’ proposals in the AR.
(ECF Nos. 55, 58, and 59.) Defendant does not oppose adding the proposals to the
AR, but argues that SAIC’s request is not meritorious. (Def.’s Resp. 3, ECF No. 52.)
For the following reasons, plaintiff’s request to add the proposals of the six
awardees to the AR of this protest is rejected.
The primary reason for rejecting plaintiff’s request to add the six awardees’
proposals to the AR is the principle set forth in SEC v. Chenery Corp., 332 U.S. 194,
196 (1947) that “a reviewing court, in dealing with a determination or judgment
which an administrative agency alone is authorized to make, must judge the propriety
of such action solely by the grounds invoked by the agency.” The United States
Court of Appeals for the Federal Circuit has instructed that this principle be applied
to procurement protests which are, as here, reviewable pursuant to 28 U. S. C. § 1491
(b)(4). OMV Med., Inc. v. United States, 219 F.3d 1337, 1344 (Fed. Cir. 2000).
The source selection plan directed that each proposal be examined individually
against the evaluation factors in the plan and that proposals “[w]ill not be compared
against each other at any point in the source selection process, except in comparing
cost/price should the information be appropriate to assist the SSA and/or the KO
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[contracting officer] in the performance of their responsibilities.” (AR 1570.) The
adjectival ratings for plaintiff’s proposal, which led to the decision to deny an award
and which did not involve “cost/price,” were reached with no examination of, or
comparison with, the six proposals at issue. (AR 1750.) For the court to consider or
compare documents, such as the awardees’ proposals, not relied upon by the Agency
in reaching its no-award decision on plaintiff’s proposal, would violate the applicable
principle of judicial review set forth above.
Moreover, this is especially the case when it is considered that the Agency
contemplated making up to ten awards, but only awarded six. If, on judicial review,
the negative evaluation of plaintiff’s proposal were determined to lack a rational basis
such that an award to plaintiff might be appropriate, this would have no impact on the
current six IDIQ awards. An award to plaintiff would not displace any of the current
awards but would simply add a seventh IDIQ contract to carry out the procurement.
In short, the validity of any of the six IDIQ awards is not an issue in this
protest. The awards are not subject to judicial review pursuant to the standards set
in 28 U.S.C. § 1491(b)(4). This protest does not seek to overturn any of the awards.
In resolving this protest there is no occasion to address whether there is, or is not, a
rational basis for each, or for any, of the six awards which would be an issue if any
comparison, contrary to the source selection plan, were to be involved. The proposals
submitted by the six awardees were not considered in the process leading to the
Agency’s decision not to award plaintiff an IDIQ contract. Because there was no
comparison of proposals involved in the adjectival rating process which resulted in
the Agency’s decision not to award an IDIQ contract to plaintiff, the proposals
submitted by others also seeking an IDIQ contract in this procurement are simply
irrelevant in determining the validity of plaintiff’s protest. A complete AR on
plaintiff’s protest must comprise the material considered by the Agency in
determining not to award an IDIQ contract to plaintiff, not material not considered.2/
2/
Plaintiff also requests that individual evaluator worksheets be added to the AR. Initially,
defendant responded the Agency reported that “[n]o such evaluator worksheets exist.” (ECF No. 52
at 6.) Subsequently, the Agency located worksheets from a single day in late March 2011 and
another day in mid-April 2011. (ECF No. 67 at 13.) Defendant opposes adding these worksheets
to the AR noting that the decision not to award an IDIQ contract to plaintiff was reached on a
consensus rating which is fully included in AR 1711-1990. The Source Selection Plan provided that
“[w]orking papers will be destroyed when final evaluation is complete.” (AR 1579.) The
(continued...)
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II. Standing and Jurisdiction
SAIC challenges the Agency’s determination that SAIC’s proposal was
unacceptable, therefore not eligible for an award. Defendant and moving intervenors
contend that because its proposal was determined to be unacceptable, SAIC cannot
establish it had any chance, much less a substantial chance, for a contract award.
Accordingly, the Motions to Dismiss conclude that SAIC has no standing and this
court lacks jurisdiction.
The court has “jurisdiction to render judgment on an action by an interested
party objecting to a solicitation by a Federal agency for bids or proposals for a
proposed contract or to a proposed award or the award of a contract or any alleged
violation of statute or regulation in connection with a procurement or a proposed
procurement.” 28 U.S.C. § 1491(b)(1).
While on its face, this post-award protest falls within this jurisdictional grant,
as a threshold matter SAIC must establish prejudice for standing purposes. Digitalis
Educ. Solutions, Inc. v. United States, No. 2011-5079, 2012 WL 12260, at *2 (citing
Rex Serv. Corp. v. United States, 448 F.3d 1305, 1307 (Fed. Cir. 2006)); see also
Info. Tech. & Applications Corp. v. United States, 316 F.3d 1312, 1319 (Fed. Cir.
2003); Bannum, Inc. v. United States, 404 F.3d 1346 (Fed. Cir. 2005); Myers
Investigative & Sec. Servs. v. United States, 275 F.3d 1366, 1369-70 (Fed. Cir. 2002)
(“[S]tanding is a threshold jurisdictional issue .… [P]rejudice (or injury) is a
necessary element of standing.”)
“Interested party” in the jurisdictional grant of § 1491(b)(1) is “an actual or
prospective bidder or offeror whose direct economic interest would be affected by the
award of the contract or by failure to award the contract.” Am. Fed. Gov’ t Emps. v.
United States, 258 F.3d 1294, 1302 (Fed. Cir. 2001) (quoting 31 U.S.C. § 3551(2));
2/
(...continued)
worksheets which did survive were not considered in reaching the decision to deny an IDIQ contract
award to plaintiff. (ECF No. 67, Ex. 1, Declaration of Cpt. Carl Jason Bromley, ¶ 9.) Thus, while
it appears that these worksheets are irrelevant to a determination whether the Agency’s no award
decision has a rational basis, in the interests of obviating further controversy, it is concluded that any
surviving worksheet or portion thereof, addressed to plaintiff’s proposal shall be added to the AR.
Worksheets, or portions thereof, addressed to proposals submitted by others shall not be included
in the AR.
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see also Distrib. Solutions Inc. v. United States, 539 F.3d 1340, 1344 (Fed. Cir.
2008); Rex Serv. Corp., 448 F.3d at 1307; Myers Investigative & Sec. Servs., 275 F.3d
at 1369-70. To establish a direct economic interest, the protestor must establish that
it had a “substantial chance” of a contract award. Labatt Food Serv., Inc. v. United
States, 577 F.3d 1375, 1378 (Fed. Cir. 2009); Weeks Marine, Inc. v. United States,
575 F.3d 1352, 1359 (Fed. Cir. 2009); Rex Serv. Corp., 448 F.3d at 1308.
As standing is a jurisdictional requirement, a protestor’s failure to establish
standing “precludes a ruling on the merits.” Magnum Opus Techs., Inc. v. United
States, 94 Fed. Cl. 512, 530 (2010) (citing Media Techs. Licensing, LLC v. Upper
Deck Co., 334 F.3d 1366, 1370 (Fed. Cir.2003)). “The corollary to this principle is
that the Government cannot require a plaintiff to prove the merits of its case in order
to demonstrate standing. Thus, it is a ‘circular argument’ to state that a plaintiff who
is challenging a non-responsibility finding that must show its responsibility before
it possesses standing to challenge the agency’s conclusion it is not responsible.” Id.
(citing Tip Top Constr. Co. v. United States, No. 08-352, 2008 WL 3153607, at *11
(Fed. Cl. Aug.1, 2008); Dyonyx, L.P. v. United States, 83 Fed. Cl. 460, 469 (2008)).
This initial prejudice examination is a “limited review.”
In a post-award bid protest, before reaching the merits of the parties’
dispute, the court conducts only a “limited review” of the plaintiff’s
allegations and the administrative record for the “minimum requisite
evidence necessary for plaintiff to demonstrate prejudice and therefore
standing.” Night Vision Corp. v. United States, 68 Fed. Cl. 368, 392 &
n.23 (2005); see also McKing Consulting Corp. v. United States, 78 Fed.
Cl. 715, 721 (2007). This threshold determination of standing should
“require[] only that a protestor be (1) either a bidder or proposer that has
been prevented from bidding or proposing due to some infraction other
than the terms of the solicitation itself; or (2) either a bidder or proposer
who would be in contention absent the unreasonable procurement
decision or violation of applicable procurement regulations.” Textron,
Inc. v. United States, 74 Fed. Cl. 277, 285 (2006); see also Global
Comp. Enters., 88 Fed. Cl. at 401. This approach “avoid[s] examining
the parties’ arguments on the merits in order to resolve standing.”
Textron, 74 Fed. Cl. at 285.
Magnum Opus Techs., 94 Fed. Cl. at 530 n.12.
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The court must accept the well-pled allegations in the complaint in determining
prejudice for jurisdictional standing. See, e.g., Info. Tech., 316 F.3d at 1319 (finding
that standing was established assuming the protestor succeeded on its argued
grounds); USfalcon, Inc. v. United States, 92 Fed. Cl. 436, 450 (2010); Beta Analytics
Int’l, Inc. v. United States, 67 Fed. Cl. 384, 396 (2005) (same). See also Engage
Learning, Inc. v. Salazar, 660 F.3d 1346, 1353-54 (Fed. Cir. 2011).
However, SAIC has the burden of establishing any challenged facts in this
regard.
In reviewing defendant’s motion to dismiss for lack of jurisdiction
pursuant to Rule 12(b)(1) of the Rules of the Court of Federal Claims
(“RCFC”), the court assumes that the allegations in the complaint are
true and construes them in plaintiff’s favor. Henke v. United States, 60
F.3d 795, 797 (Fed. Cir. 1995). If, however, defendant challenges
plaintiff’s allegations, then plaintiff bears the burden of proving facts
sufficient to invoke the court’s jurisdiction by a preponderance of the
evidence. Reynolds v. Army & Air Force Exch. Serv., 846 F.2d 746, 748
(Fed. Cir. 1988).
Magnum Opus Techs., 94 Fed. Cl. at 524-25.
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Noted as the subject of confusion,3/ differences between prejudice for
jurisdictional standing, and prejudice on a merits determination – “adjudicatory
prejudice,” were detailed in Linc Government Services, LLC v. United States, 96 Fed.
Cl. 672 (2011) (characterizing the initial threshold as “allegational prejudice”).
The term “allegational” merely denotes the focus on a plaintiff’s
allegations of agency error and does not fix the plaintiff’s evidentiary
burden in demonstrating prejudice. As a central element of standing, the
initial showing of prejudice “is not a mere pleading requirement ‘but
rather an indispensable part of the plaintiff’s case’” in a bid protest.
Night Vision Corp., 68 Fed. Cl. at 391 (quoting Lujan, 504 U.S. at 561,
112 S. Ct. 2130). Accordingly, it “must be supported in the same way
as any other matter on which the plaintiff bears the burden of proof, i.e.,
with the manner and degree of evidence required at the successive stages
of the litigation.” Lujan, 504 U.S. at 561, 112 S. Ct. 2130. Allegations
alone may suffice at the pleading stage, but concrete evidence is
required at later stages. Canadian Lumber Trade Alliance v. United
States, 517 F.3d 1319, 1331 (Fed. Cir. 2008). Even at the pleading
3/
This confusion has sometimes led the court to forego the prejudice
inquiry altogether, in the belief that only “[i]f the court finds error” in
the procurement process does “it then examine[ ] whether the error
was prejudicial to plaintiff.” Info. Tech. and Applications Corp., Inc.
v. United States, 51 Fed. Cl. 340, 346 (Fed. Cl. 2001) (dismissing the
protest after finding no errors in the contested procurement), aff’d,
316 F.3d 1312, 1319 (affirming dismissal of the protest on the merits,
but holding that the Court of Federal Claims’ “approach was
erroneous” in failing to examine prejudice before addressing the
merits). In other cases, the court has wasted judicial resources
adjudicating the merits of a bid protest that the plaintiff never had
standing to bring in the first instance. E.g., Myers Investigative &
Sec. Servs., Inc. v. United States, 47 Fed. Cl. 605, 620 (2000)
(holding that its “plaintiff failed to prove it was prejudiced by
defendant's actions” and dismissing the protest, but only after
deciding the merits), aff’d, 275 F.3d 1366, 1371 (affirming dismissal
of the protest due to the plaintiff’s failure to demonstrate prejudice,
but on the ground that the plaintiff thus “did not have standing”).
Linc Gov’t Servs., LLC v. United States, 96 Fed. Cl. 672, 695 n.29.
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stage, if facts foundational to the showing of allegational prejudice are
challenged, a plaintiff must establish those facts by a preponderance of
the evidence. See Moyer v. United States, 190 F.3d 1314, 1318 (Fed.
Cir. 1999) (“Fact-finding is proper when considering a motion to
dismiss where the jurisdictional facts in the complaint . . . are
challenged.”).
96 Fed. Cl. at 695 n.28.
In this regard, SAIC asserts it had a substantial chance of being included in the
group of awardees but for the Agency’s improper evaluation both of its proposal as
well as the awardees’ proposals:
SAIC also has standing because it was prejudiced by the Army’s actions
in this procurement--that is, SAIC had a “substantial chance” of
receiving a contract if the Army had properly evaluated proposals.
SAIC was prejudiced by the Agency’s improper evaluation of SAIC’s
proposal and also by the improper evaluation of the awardees’
proposals. If the Agency had performed proper evaluations, SAIC
would have had an acceptable proposal that was better than one or more
of the six awardees’ proposals and therefore would have had a
“substantial chance” to receive an award. Specifically, SAIC’s proposal,
at a minimum, would be a better value than the proposal submitted by
CACI Premier Technology, Inc., which had the lowest technical rating
of the six awardees and a higher price than SAIC.
(Compl. ¶ 15, ECF No. 1-2.)4/
Paragraph 74 alleges error in its unacceptable rating:
SAIC has a substantial chance of receiving the contract if the evaluation
errors at issue in this protest are corrected. The Agency’s evaluation of
4/
While correction of any established improper evaluations of plaintiff’s proposal could
conceivably raise its ratings to the point the proposal would be at the level which received IDIQ
contracts in this procurement, given the Source Selection Plan prohibition on comparative
evaluation, any improper evaluation, if any, of another’s proposal would not be a relevant
consideration in this regard.
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SAIC’s proposal as being “Unacceptable” and the Agency’s best value
determination were based on an arbitrary, unreasonable, and unequal
evaluation of SAIC’s proposal.
(Id. ¶ 74, ECF No. 1–19.)
Defendant argues SAIC lacks standing because its proposal was unacceptable
and incomplete. Linc advances similar positions, adding that even if successful,
SAIC was not next in line for an additional award. Mission Essential contends SAIC
is simply unable to perform the contract, citing Myers Investigative & Sec. Servs., Inc.
v. United States, 275 F.3d 1366, 1371 (Fed. Cir. 2002) (holding that a protestor had
no standing because, in part, “plaintiff has not provided the court with any evidence
demonstrating that it has been awarded or successfully performed contracts for
similar services in the past”)(citing Myers, 47 Fed. Cl at 620). “The mere fact that it
might have submitted a bid in a competitive procurement is not sufficient. Although
it need not show that it would have received the award in competition with other
hypothetical bidders, it must show that it would have been a qualified bidder. This
Myers has not done.” 275 F.3d at 1370-71. SAIC, it is argued, while having
experience in very large government contracts, particularly in the information
technology area, has no experience in providing these types of services – linguists –
on an expedited and large scale basis.
SAIC does not disagree that this initial prejudice review is limited, not a merits
review, citing Magnum Opus Techs., Inc. v. United States, 94 Fed. Cl. 512, 530
(2010). However, responding to its “technically unacceptable” or “technically
deficient” ratings as precluding jurisdiction under defendants’ motions, SAIC
responds that the definition of “unacceptable” given to SAIC’s proposal differs from
statutory, regulatory and case construction of “unacceptable” which requires material
failures. Centech Group, Inc. v. United States, 554 F.3d 1029, 1038 (Fed. Cir. 2009)
(“[A] proposal that fails to conform to the material terms and conditions of the
solicitation should be considered unacceptable and a contract award based on such
an unacceptable proposal violates the procurement statutes and regulations,” quoting
E.W. Bliss Co. v. United States, 77 F.3d 445, 448 (Fed. Cir. 1996)). According to
SAIC, a solicitation term is material where it has more than a negligible impact on the
price, quantity, quality, or delivery, and the matters cited by the Agency, regardless
of their bona fides, were not material in that sense. Moreover, the proposal found to
be incomplete in Bluestar Energy Services cited by the defendant, failed to contain
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In response to Linc’s position that another unsuccessful bidder – Torres was,
as ranked, more likely than SAIC to obtain any additional IDIQ contract that might
be awarded, SAIC states that if the Army had evaluated SAIC’s proposal properly,
SAIC would have had an acceptable proposal that was better than one or more of the
six awardees’ proposals and therefore would have had a “substantial chance” to
receive an award.6/
In reply, the government addresses merits arguments, couched in terms of not
establishing a “substantial chance” of an award, concluding that for SAIC to possess
standing, it must show that it can somehow overturn that reasoned decision that
omissions in SAIC’s management proposal “indicate a lack of understanding of the
problems or an approach that cannot be expected to meet requirements” such that
“none of these conditions can be corrected without a major rewrite or revision of the
proposals.”
The positions advanced – that the Agency did not act arbitrarily or capriciously
in rating SAIC’s proposal as unacceptable, therefore SAIC had no chance of an
award, go to the merits of the controversy and it is this merits rigor that the Motions
to Dismiss would require of SAIC at this threshold jurisdictional stage. To be clear,
questions of different definitions aside, while an unacceptable rating would preclude
SAIC from further consideration, jurisdiction is not removed to examine the bona
fides of that determination. The Federal Circuit’s direction that prejudice for subject
matter jurisdiction must be reached “before addressing the merits,” presupposes
distinct inquiries, otherwise the standing prejudice has no vitality. Magnum Opus,
94 Fed. Cl. at 530 (citing Info. Tech., 316 F.3d at 1319); see also Myers Investigative
Sec. Servs., 275 F.3d at 1370. The jurisdictional motions seek to remove those
6/
It is noted that the Agency reserved the option to revisit the group of awardees on an
annual basis.
The Government may assess annually whether to conduct an open season
competition (“on ramp”) to add additional contract holders or consider use of an “off
ramp” process for contractors that perform unsatisfactorily and/or are unable to
maintain cost control/effectiveness. The need for additional contract holders is
discretionary with the Government and may be influenced by factors such as a lack
of adequate task order competition, the need to enhance the pool of expertise for new
task orders, or other causes as determined by the Contracting Officer.
(AR 3.)
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distinctions and insulate subjective exclusionary evaluation conclusions from review.
This result is not supported by relevant authority. See Labatt Food Serv., Inc. v.
United States, 577 F.3d 1375, 1379 (Fed. Cir. 2009); L-3 Comm’cns EOTech, Inc. v.
United States, 87 Fed. Cl. 656, 664 (2009); Esterhill Boat Service Corp. v. United
States, 91 Fed. Cl. 483, 486 (2010); Chenega Management, LLC. v. United States, 96
Fed. Cl. 556, 571-72 (2010).
The Federal Circuit has addressed the error of conflating subject matter
jurisdiction and the merits.
Courts frequently confuse or conflate the distinction between subject
matter jurisdiction and the essential elements of a claim for relief. See,
e.g., Arbaugh v. Y & H Corp., 546 U.S. 500, 503, 511, 126 S.Ct. 1235,
163 L.Ed.2d 1097 (2006) (“On the subject-matter
jurisdiction/ingredient-of-claim-for-relief dichotomy, this Court and
others have been less than meticulous.”); Moden v. United States, 404
F.3d 1335, 1340 (Fed. Cir.2005). The Supreme Court’s decision in Bell
v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939 (1946), is instructive.
In Bell, the petitioners brought suit against FBI officers for alleged
violations of their Constitutional rights under the Fourth and Fifth
Amendments. Id. at 679, 66 S.Ct. 773. The respondents defended the
district court’s dismissal for lack of federal subject matter jurisdiction
on the ground that, inter alia, the petitioners could not recover damages
based on their Constitutional claims. Id. at 680–81, 66 S.Ct. 773. The
Court disagreed and reversed the dismissal, holding that the petitioners’
complaint adequately stated a claim arising under the Constitution of the
United States and that “[j]urisdiction … is not defeated as respondents
seem to contend, by the possibility that the averments might fail to state
a cause of action on which petitioners could actually recover.” Id. at
682, 66 S.Ct. 773. Rather, the Court continued, “it is well settled that
the failure to state a proper cause of action calls for a judgment on the
merits and not for a dismissal for want of jurisdiction.” Id.; see also
MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 135–36, 127 S.Ct.
764, 166 L.Ed.2d 604 (2007)
.…
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To the extent a successful claim against the government requires
compliance with all statutory elements of the claim, failure of proof of
an element of the cause of action means the petitioner is not entitled to
the relief he seeks. To conclude in such a case that the petitioner loses
because the forum is “without jurisdiction” is to obscure the nature of
the defect. It would be more accurate to conclude that the petitioner has
failed to prove the necessary elements of a cause for which relief could
be granted. Spruill v. Merit Sys. Prot. Bd., 978 F.2d 679, 687 (Fed.
Cir.1992).
Engage Learning, 660 F.3d 1346, 1353-54 (Fed. Cir. 2011); see also Trauma Serv.
Grp. v. United States, 104 F.3d 1321, 1325 (Fed. Cir.1997) (“A well-pleaded
allegation in the complaint is sufficient to overcome challenges to jurisdiction.”);
Liberty Ammunition, Inc. v. United States, No. 11-84C, 2011 WL 5150221, at *5
(Fed. Cl. Oct. 31, 2011).
In Distributed Solutions, Inc. v. United States, 539 F.3d 1340 (Fed. Cir. 2008)
the government agency added proposed acquisitions to an existing contract, and
fulfilled its procurement need in a way that eliminated an opportunity for the
protestors to compete directly for that contract. Id. at 1342-43. The incumbent
contractor then engaged subcontractors for the product required by the agency, and
the protestors were not among the companies chosen as subcontractors. Id. at 1343.
The Federal Circuit held that the protestors had jurisdictional standing to protest the
agency action, even though there was no direct solicitation by the agency for which
they could compete. Id. at 1345. See L-3 Comm’cns EOTech, Inc. v. United States,
87 Fed. Cl. 656, 665 (2009) (“Whether L-3 will prevail on the merits of its disparate
treatment argument is not a question of standing.”).
While no merits decision is now before the court, SAIC’s high burden in this
regard is noted7/ and no solace should be taken in the jurisdictional decision reached
herein. See Vanguard Recovery Assistance Joint Venture v. United States, No. 1139C, 2011 WL 5928099 (Fed. Cl. Nov. 29, 2011) (finding non-prejudicial error on
7/
See IBM Corp. v. United States, No. 11-533C, 2011 WL 6005189 (Fed. Cl. Nov. 15, 2011)
(denying merits of protestor’s claims of error in adjectival ratings, disparate treatment and other
claims in solicitation for IDIQ contracts for software and IT products for selection of up to fifteen
awardees); Standard Commc’ns, Inc. v. United States, No. 11-530C, 2011 WL 5865873, at *7-8
(Fed. Cl. Nov. 22, 2011) (crediting agency rating determinations).
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the merits) and 99 Fed. Cl. 81 (2011) (finding protestor had standing and the court
had jurisdiction over those claims). However, upon analysis the Motions to Dismiss
trend toward comprising a disguised shortcut to the merits of the protest. In this
regard the validity of the “unacceptable” rating applied to SAIC’s proposal is a
merits-based determination, with mixed questions of law or fact coupled with
deference to the Agency discretion. This is unlike finding whether an entity qualifies
as a small business – an objective analysis – or other clearly disqualifying factor such
as failure to submit a price proposal, failing to submit a proposal at all or filing late.
Magnum Opus Techs., Inc. v. United States, 94 Fed. Cl. 512, 530 (2010)
Here, SAIC has also alleged numerous instances of action deemed arbitrary,
capricious or an abuse of discretion in the rating of its proposal. The defendant and
moving intervenors correctly observe that pursuant to the Source Selection Plan, each
proposal was reviewed individually for the adjectival ratings, and not in comparison
with others. Nevertheless, as noted, SAIC proposes to rely on a comparative analysis
by alleging in several paragraphs of its Complaint that there was unequal treatment,
inconsistencies and irregularities. While this court may well reject the merits of those
claims, the court is reluctant to find at this preliminary point that it lacks jurisdiction
to resolve all claims of evaluation error. No party claims SAIC was a rogue bidder
or that the claims are frivolous, although some assertions come close. Rather, the
argument made is that the Agency’s review of SAIC’s proposal was not arbitrary,
capricious or an abuse of discretion. Challenges made and defenses thereto go to the
ultimate merits of the protest and to honor the discretion of the Agency. For example,
there is no claim that SAIC would not have standing if its claims that the Agency did
not understand its proposal or ignored portions of its proposal (allegational prejudice)
were to be proven (adjudged prejudice).
Moreover, whether or not SAIC had a substantial chance to be added to the
group of awardees requires resolution of issues that are, at minimum, intertwined
with, if not identical to, inquiries addressed to the merits of claimed evaluation errors
which it is anticipated will be raised in motions for judgment on the AR. This
counsels against determining the predicate error alleged at this stage in the
proceeding. Forest Glen Props., LLC v. United States, 79 Fed. Cl. 669, 678-79
(2007) (“When it appears to a court, however, that the jurisdictional facts are
‘inextricably intertwined with the merits,’ it may postpone their determination until
trial when all relevant evidence may be considered at the same proceeding.” (citing
Beuré-Co. v. United States, 16 Cl. Ct. 42, 52-53 (1988), Land v. Dollar, 330 U.S. 731,
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735-39 (1947) and Kawa v. United States, 77 Fed. Cl. 294, 304 n.4 (2007)); Oswalt
v. United States, 41 Fed. Appx. 471 (Fed. Cir. 2002) (quoting Wright and Miller, 5A
Federal Practice and Procedure § 1350 (2d ed. 1990) (unpublished) (finding error in
the granting of a motion to dismiss for lack of jurisdiction where the issues were
“intertwined with the merits of the case, [then] the decision on jurisdiction should
‘await a determination on the merits.’”).
For all the above stated reasons, it is ORDERED:
(1) That the Motions to Dismiss (ECF Nos. 53, 56 & 57) for lack of standing
are DENIED, without prejudice to consideration of the same or similar issues raised
in motions for judgment on the AR pursuant to RCFC 52.1; and
(2) That plaintiff’s motion (ECF No. 33) to complete the AR by adding the six
awardee proposals is DENIED, but those surviving evaluator worksheets, or portions
thereof, addressed to plaintiff’s proposal shall be added to the AR.
s/ James F. Merow
James F. Merow
Senior Judge
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