MITCHCO INTERNATIONAL, INC. v. USA

Filing 30

**RE-DOCKETED 24 ORDER TO CORRECT FILING ERROR AND FOR PUBLICATION**. Signed by Senior Judge Eric G. Bruggink. (ew) Service on parties made.

Case 1:20-cv-00879-EGB Document 24 Filed 08/17/20 Page 1 of 4

In the United States Court of Federal Claims
No. 20-879C
(Filed: August 17, 2020)

*********************
MITCHCO INTERNATIONAL, INC.,
Plaintiff,
v.
THE UNITED STATES,

Post-award bid protest;
Intervention; RCFC 24;
Independent
basis
for
jurisdiction; Subcontractor.

Defendant,
and
KENTUCKY OFFICE OF
VOCATIONAL REHABILITATION,
Intervenor.
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Alan M. Grayson, Windermere, FL, for plaintiff.
Richard P. Schroeder, United States Department of Justice, Commercial
Litigation Branch, Washington, DC, with whom were Ethan P. Davis, Acting
Assistant Attorney General, Robert E. Kirschman, Jr., Director, and Douglas
K. Mickle, Assistant Director, for defendant.
ORDER
BRUGGINK, Judge.
In this post-award bid protest, Mitchco International, Inc.
(“Mitchco”), alleges that the United States Army improperly awarded a
contract to the Kentucky Office of Vocational Rehabilitation (“KOVR”) to
provide food service and dining room operation services at Fort Knox in
Kentucky. KOVR, as the awardee, sought and was granted intervention as
of right. Plaintiff did not oppose the motion. The putative awardee’s

Case 1:20-cv-00879-EGB Document 24 Filed 08/17/20 Page 2 of 4

subcontractor, Southern Foodservice Management, Inc. (“Southern”), the
entity that will perform the work on site, has since sought to intervene of its
own right under Rule 24(b)(2), permissive intervention. 1 Plaintiff and
defendant oppose, arguing that Southern has neither a legally protectable
interest in the action nor a claim or defense that shares a common question
of fact or law with those in this action.
Rule 24(a) states that the court must allow intervention when the party
seeking intervention “claims an interest relating to the property or transaction
that is the subject of the action, and is so situated that disposing of the action
may as a practical matter impair or impede the movant’s ability to protect its
interest, unless existing parties adequately represent that interest.” RCFC
24(a)(2). Permissive intervention, under 24(b), allows the court to grant
intervention when the party “has a claim or defense that shares with the main
action a common question of law or fact.” Id. 24(b)(2). Southern recognizes
that normally a subcontractor is not an intervenor in a bid protestor but argues
that Mitchco has put at issue its role in performing the contract, as well as its
conduct related to the procurement by alleging violations by Southern of the
Procurement Integrity Act 2 and other misconduct and improper collusion
between Southern and KOVR.
Plaintiff’s response that it has put only the federal government’s
conduct regarding the Procurement Integrity Act at issue is completely at
odds with the complaint, which directly targets Southern’s conduct, thereby
creating, at least in plaintiff’s view, a nexus between Southern’s role in the
procurement and the existing parties’ claims and defenses. This would
appear to satisfy the requirements of Rule 24(b). Mitchco argues, however,
that more is necessary. Citing several non-procurement cases, Mitchco
argues that the court must find a separate jurisdictional basis for the putative
intervenor’s appearance. See Aeroplate Corp. v. United States, 111 Fed. Cl.
298, 300 (2011) (not allowing permissive intervention because of the lack of
an independent basis for jurisdiction); M.E.S., Inc. v. United States, 99 Fed.
Cl. 239, 244 (2011) (finding a legally protectable interest in the outcome and
granting intervention as of right under the doctrine of ancillary jurisdiction).
Mitchco has also sued the Commonwealth of Kentucky in state court for
breach of an agreement between them which Mitchco asserts guarantees to it
the right to perform as the subcontractor under any contract that Kentucky
receives from the federal government for food service management at Fort
Knox. The state court has issued an injunction prohibiting Southern from
performing for KOVR. Pl.’s Opp’n to Southern’s Mot. To Intervene 3-4
(ECF No. 15). That lawsuit is ongoing.
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We find intervention proper in these circumstances. If plaintiff’s
complaint is taken at face value, Southern’s actions regarding this
procurement are directly relevant to the bona fides of the putative award to
KOVR. If plaintiff is correct, Southern violated procurement law and
committed fraud, in collusion with KOVR, when KOVR was tentatively
awarded the contract. Who better and with more at stake to deal with these
accusations than Southern? Irrespective of what the rule may require in
circumstances not involving bid protests, here, there is no reason to look for
an independent jurisdictional rationale for permitting plaintiff to protect its
interests. The court’s jurisdictional reach under 28 U.S.C. § 1498 (b)(1)
(2012), is limited to the disputed procurement. The test under Rule 24(b)(2)
for whether the putative intervenor shares “claims and defenses” must be
seen in the limited context of the original protest. There is no reason to
require a wider scope of review nor is there any hazard in granting the
intervenor a seat at the table. There is no danger that the court will be called
on to adjudicate an “additional claim on the merits,” thereby necessitating an
independent basis for jurisdiction. Aeroplate, 111 Fed. Cl. at 300 (holding
that the court lacked jurisdiction over the movant’s claim and thus could not
grant permissive intervention). Our review is thus limited to the propriety
of the federal government’s actions or inactions in awarding this contract,
but Southern may be able to shed light on the question by explaining its own
conduct in response to the allegations brought by plaintiff. In that sense,
Southern has a defense that shares a common question of law and fact with
the government’s and KOVR’s defense of the Army’s decision to award to
KOVR (and to Southern as the subcontractor). This is enough in a bid protest
to allow permissive intervention under Rule 24(b)(2). 3
In any event, the fact that the contract was awarded pursuant to the
Randolph Sheppard Act, 20 U.S.C. § 107 (2012), lends support to granting
intervention under Rule 24(a)(2) as well. Although the Commonwealth of
Kentucky, acting through KOVR, is the nominal awardee, its role is only that
of a sponsoring state agency. It is Southern that stands to win or lose
economically in the end. The federal government is largely indifferent to
who actually performs the work for the sponsoring agency. In this sense,
Plaintiff also argued that intervention was inappropriate because Southern
failed to accompany its motion with a pleading as required by the rule. That
is unnecessary, however, given the court’s practice in procurement protests
in which motions for judgment on the administrative record are filed in lieu
of pleadings other than the complaint. Plaintiff sought leave to file such a
motion in lieu of an answer, which is hereby granted. Its motion will be due
with defendant’s on September 24, 2020.

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unlike in other bid protests, Southern has an interest in the award of the
contract beyond that of a normal subcontractor. Southern’s interests are
inadequately represented by KOVR or the federal government because
Southern’s performance is not necessary for the award to KOVR. 4 Thus
intervention would be permissible under 24(a)(2). Cf. Che Consulting, Inc.
v. United States, 71 Fed. Cl. 634 (2006) (holding that an incumbent
subcontractor’s pecuniary interest in the outcome gave it standing to
intervene as of right).
Accordingly, Southern’s motion (ECF No. 13) is granted. The clerk
of court is directed to add Southern Foodservice Management, Inc. to the
docket as an intervenor.
s/ Eric G. Bruggink
ERIC G. BRUIGGINK
Senior Judge

It became apparent during the status conference held on July 24, 2020, that
the Army is indifferent to whether Southern or Mitchco performs as KOVR’s
subcontractor (a transcript is unavailable for citation at this point). KOVR
likewise may remain in place as the awardee regardless of whether Southern
or Mitchco is the subcontractor. Southern’s interests thus are not perfectly
aligned with either defendant or the present intervenor, and we cannot say
that Southern’s interests would be adequately represented by either.
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