State of Hawaii, Department of Human Services, Division of Vocational Rehabilitation, Hoopono-Services for the Blind

Filing 27

ORDER DENYING PLAINTIFF'S SECOND MOTION FOR TEMPORARY RESTRAINING ORDER re 5 Second MOTION for Temporary Restraining Order.. Signed by JUDGE LESLIE E. KOBAYASHI on 10/20/2017. (eps, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF).

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
STATE OF HAWAII, DEPARTMENT
OF HUMAN SERVICES, DIVISION
OF VOCATIONAL REHABILITATION,
HOOPONO-SERVICES FOR THE
BLIND,

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Plaintiff,
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vs.
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UNITED STATES DEPARTMENT OF
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EDUCATION, REHABILITATION
)
SERVICES ADMINISTRATION,
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Defendant.
_____________________________ )

CIVIL 17-00430 LEK-KSC

ORDER DENYING PLAINTIFF’S SECOND
MOTION FOR TEMPORARY RESTRAINING ORDER
On August 28, 2017, Plaintiff State of Hawai`i,
Department of Human Services, Division of Vocational
Rehabilitation, Ho`opono - Services for the Blind (“Ho`opono”)
filed its Second Motion for Temporary Restraining Order (“TRO
Motion”).
support).]

[Dkt. nos. 5 (TRO Motion) & 6 (memorandum in
Defendant United States Department of Education,

Rehabilitation Services Administration (“Defendant”) filed its
memorandum in opposition on September 12, 2017.

[Dkt. no. 19.]

The Court finds this matter suitable for disposition without a
hearing pursuant to Rule LR7.2(d) of the Local Rules of Practice
of the United States District Court for the District of Hawai`i
(“Local Rules”).

On September 19, 2017, this Court issued an

entering order outlining the Court’s decision on the TRO Motion

(“9/19/17 EO Outline”).

[Dkt. no. 24.]

supersedes the 9/19/2017 EO Outline.

The instant Order

The TRO Motion is hereby

denied for the reasons set forth below.
BACKGROUND
The instant case is an appeal of an Arbitration
Decision, dated July 24, 2017 (“the Decision”), in proceedings
brought pursuant to the Randolph-Sheppard Act, 20 U.S.C. § 107,
et seq. (“the Act”).

[Complaint and Appeal Brief (“Complaint”),

filed 8/28/17 (dkt. no. 1), Exh. A (Decision).]

Ho`opono is

Hawaii’s licensing agency for purposes of the Act, and Defendant
is the federal agency that administers the Act.
¶¶ 7-8.]

[Complaint at

Ho`opono describes the purpose of the Act as

“provid[ing] ‘blind persons with remunerative employment,
enlarging the economic opportunities of the blind and stimulating
the blind to greater efforts and striving to make themselves
self-supporting’ by authorizing them to operate vending
facilities on government property and giving them a ‘priority’ to
do so.”

[Id. at ¶ 9 (quoting 20 U.S.C. §§ 107(a) and (b)).]
From 2005 to 2016, pursuant to Contract No. W912CN-16-

D-0016 between the Army and Ho`opono (“the Contract”), the
licensed Ho`opono blind vendor – James Theodore Chinn, Jr. –
provided cafeteria services at four Schofield Barracks
(“Schofield”) dining halls.

Some of the dining halls were

designated as Full Food Service (“FFS”) facilities, and the

2

others were designated as Dining Facility Attendant (“DFA”)
facilities.1

The Contract was designated as an FFS contract

because it involved some facilities with food preparation.

The

Army’s position is that the Act only applies to FFS contracts,
but Ho`opono contends the Act applies to all Army dining
facilities.

[Id. at ¶ 14.]

In a December 22, 2015 letter to Ho`opono, the Army
stated that the Contract was in its last option year and would
expire on March 31, 2016.

However, the subsequent contract was

going to be “down-scoped” from an FFS contract to a DFA services
contract.

[Complaint, Exh. B.]

The Army stated that it intended

to reserve the contract for Ho`opono because of its priority
under the Act, which would result in the new contract being
awarded to Ho`opono unless it’s “offer exceed[ed] the low offeror
by more than five percent of that offer or one million dollars,
whichever is less.”

[Id.]

However, on February 25, 2016, the

Army amended Solicitation No. W912CN-16-R-0005 (“the
Solicitation”) to make the DFA dining halls subject to a separate
contract with “an exclusively small-business set-aside

1

Pursuant to Army regulations, FFS “encompasses all aspects
of feeding the troops at Schofield Barracks including food
preparation and day-to-day operation of dining facilities,”
whereas DFA services “are similar, but do not include food
preparation, as those services are performed by uniformed
personnel.” [Complaint at ¶ 14.] Ho`opono points out that the
Act itself does not contain this distinction between types of
cafeteria operation contracts. [Id.]
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procurement, which did not allow Ho`opono to bid for the contract
because it did not qualify as a small business.”

[Complaint at

¶ 15.]
In the arbitration proceeding, the parties addressed
the issue of whether the Act required the Army to give Ho`opono
priority in bidding for the new Schofield DFA services contract.
[Id. at ¶ 1.]

A majority of the arbitration panel concluded that

DFA services are not subject to the Act, and therefore the Army
did not violate the Act when it issued the Solicitation without
applying the Act’s priority and procedures.

[Decision at 12-13.]

In the instant appeal, Ho`opono seeks to have the Decision
overturned “because it is erroneous and contrary to law and the
provisions of the Act.”

[Complaint at ¶ 3.]

In the TRO Motion, Ho`opono seeks an order prohibiting
the Army from awarding the new DFA service contract “to Acorn
[Services, Inc.] or any other vendor that is not a blind vendor
pursuant to the Act.”

[Mem. in Supp. of TRO Motion at 11-12.]

The TRO Motion represents that Ho`opono had an agreement with the
Army that Mr. Chinn would continue to provide the cafeteria
services at Schofield until January 31, 2018.

[Id. at 3.]

Thus,

Ho`opono argues that the Army should be required to maintain the
status quo by allowing Mr. Chinn to continue to provide the
cafeteria services during the pendency of the instant appeal.

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STANDARD
“A plaintiff seeking a preliminary injunction must
establish that he is likely to succeed on the merits, that he is
likely to suffer irreparable harm in the absence of preliminary
relief, that the balance of equities tips in his favor, and that
an injunction is in the public interest.”
Def. Council, Inc., 555 U.S. 7, 20 (2008).

Winter v. Nat. Res.
The preliminary

injunction standard also applies to a plaintiff’s request for a
See, e.g., Washington v. Trump, 847 F.3d 1151, 1159 n.3

TRO.

(9th Cir. 2017) (citing Stuhlbarg Int’l Sales Co., Inc. v.
John D. Brush & Co., Inc., 240 F.3d 832, 839 n.7 (9th Cir.
2001)).2

Ho`opono has the burden of proof as to each element in

the analysis.

See PNY Techs., Inc. v. Netac Tech. Co., Civil

16-00657 LEK-KSC, 2017 WL 2903342, at *5 (D. Hawai`i May 31,
2017).
DISCUSSION
Ho`opono has failed to present admissible evidence of
an executed, binding agreement with the Army extending the
Contract until January 31, 2018.

Defendant has presented

admissible evidence that the Army and Ho`opono entered into a
bridge contract “[d]ue to delays encountered with the

2

Stuhlbarg was overruled on other grounds by Winter. See,
e.g., Conservation Cong. v. United States Forest Serv., No. 2:13cv-01922-TLN-CMK, 2016 WL 6524860, at *3 (E.D. Cal. Nov. 3,
2016).
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Solicitation and amendments” (“Bridge Contract”).

[Mem. in Opp.,

Decl. of Ronnie Sakata (“Sakata Decl.”) at ¶ 7.3]

The Bridge

Contract had a base period of April 1, 2016 to May 31, 2016, with
an option period of June 1, 2016 to July 31, 2016, and subsequent
monthly options from August 1, 2016 to January 31, 2017.
the options in the Bridge Contract were exercised.

All of

[Id.]

Subsequently, the Army and Ho`opono entered into another bridge
contract, because of delays related to the arbitration (“Second
Bridge Contract”).4

[Id. at ¶ 8.]

The Second Bridge Contract

had a base period of February 1, 2017 to April 30, 2017, with an
option period of May 1, 2017 to July 31, 2017, and subsequent
monthly options from August 1, 2017 to January 31, 2018.

The

monthly options were subject to clause 52.217-8 of the Second
Bridge Contract.

[Second Bridge Contract at Pages 28-29 of 77.]

Clause 52.217-8 stated:
The Government may require continued performance
of any services within the limits and at the rates
specified in the contract. These rates may be
adjusted only as a result of revisions to
prevailing labor rates provided by the Secretary
of Labor. The option provision may be exercised
more than once, but the total extension of
performance hereunder shall not exceed 6 months.
The Contracting Officer may exercise the option by

3

Ronnie Sakata is a Supervisory Contract Specialist with
the “Regional Contracting Office - Hawaii, 413th Contracting
Support Brigade, Wheeler Army Airfield, Schofield Barracks,
Hawaii.” [Sakata Decl. at ¶ 1.]
4

The Second Bridge Contract is attached to the Sakata
Declaration as Exhibit B.
6

written notice to the Contractor within 30 days of
the contract expiration.
[Id. at Page 64 of 77.]

Thus, the decision to exercise the

monthly options was in the Army’s sole discretion.
The Army exercised the May 1 to July 31 option and the
August 1 to 31 option, but did not exercise the remaining
options.

See Sakata Decl. at ¶ 8 (stating that the Army’s

contracting office “did not exercise this option period, which
caused the contract to expire on 31 August 2017”).

Because the

Second Bridge Contract has expired, the subsequent options “are
no longer exercisable.”

[Id. at ¶ 13.]

Although the Second

Bridge Contract could have been extended through January 31,
2018, Ho`opono had no right or entitlement to such extensions.
Neither the exhibits to the Complaint nor the exhibits
to the TRO Motion contain any evidence contradicting Defendant’s
evidence.5

Based upon the record before it, this Court must

conclude that Ho`opono has not established either a legal or an
equitable basis for a continued entitlement to enforce the Second

5

On September 18, 2017, this Court issued an entering order
informing the parties that it was inclined to vacate the
September 22, 2017 hearing on the TRO Motion and decide the
motion based on the parties’ written submissions (“9/18/17 EO”).
[Dkt. no. 21.] The 9/18/17 EO noted that Ho`opono had not
included any declarations or affidavits with the TRO Motion, nor
did Ho`opono file any exhibits or declarations/affidavits in lieu
of direct examination by the September 12, 2017 deadline. [Id.
at 1.] The parties had no objection to the inclination, and the
hearing was vacated. [Dkt. nos. 22 (EO vacating hearing), 23
(letter from Defendant’s counsel stating the parties’
positions).]
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Bridge Contract.

Therefore, Ho`opono has failed to carry its

burden to prove that it – or Mr. Chinn – is likely to suffer
irreparable harm unless this Court issues a TRO.

Because a

plaintiff seeking a TRO must establish all of the Winter factors
to be entitled to relief, the failure to establish irreparable
harm is fatal to the TRO Motion, and it is not necessary for this
Court to address whether Ho`opono has established the other
Winter factors.

Ho`opono therefore is not entitled to the relief

it requests in the TRO Motion.
CONCLUSION
On the basis of the foregoing, the Second Motion for
Temporary Restraining Order, which Ho`opono filed on August 28,
2017, is HEREBY DENIED.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, October 20, 2017.

/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge

STATE OF HAWAII, ETC. VS. UNITED STATES DEPARTMENT OF EDUCATION,
ETC; CIVIL 17-00430 LEK; ORDER DENYING PLAINTIFF’S SECOND MOTION
FOR TEMPORARY RESTRAINING ORDER

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