## United States Court of Appeals for the Federal Circuit

2009-5091

RESOURCE CONSERVATION GROUP, LLC, Plaintiff-Appellant,

v. UNITED STATES, Defendant-Appellee.

Warren K. Rich , Rich and Henderson, P.C., of Annapolis, Maryland, argued for plaintiff-appellant. With him on the brief was Anthony G. Gorski

. Christopher A. Bowen , Trial Attorney, Commercia l Litigation Branch, Civil Division, United States D epartment of Justice, of Washington, DC, argued for defendant-appellee. With him on the brief were Tony West , Assistant Attorney General, Jeanne E. Davidson , Director, and Kirk T. Manhardt , Assistant Director. Of counsel on the brief was Joshua D. Harvey , United States Department of the Navy, Naval Facilities Engineering Command, of Washington, DC. Appealed from: United States Court of Federal Claims Judge Susan G. Braden

## United States Court of Appeals for the Federal Circuit

2009-5091

RESOURCE CONSERVATION GROUP, LLC, Plaintiff-Appellant,

v. UNITED STATES, Defendant-Appellee.

Appeal from the United States Court of Federal Claims in 08-CV-768, Judge Susan G. Braden.

___________________________ DECIDED: March 1, 2010

___________________________ Before LOURIE, DYK, Circuit Judges , and KENDALL, * District Judge DYK, Circuit Judge

. Resource Conservation Group (“RCG”) appeal s from a final judgment of the United States Court of Federal Claims di smissing RCG’s action for lack of subject matter jurisdiction. Res. Conservation Group, LLC v. Dep’t of Navy , 86 Fed. Cl. 475, 486 (2009). We affirm in part, reverse in part, and remand. BACKGROUND In 1913, the Naval Academy purchased land in Gambrills, Maryland, for the purpose of establishing and oper ating a dairy farm to provide milk to the Academy

* Honorable Virginia M. Kendall, Distr ict Judge, United States District Court for the Northern District of I llinois, sitting by designation.because of concerns about the safety of the commercial milk supply. In the 1990's, the Naval Academy determined that it would be cheaper to purchase milk commercially, and that the commercial milk supply was safe. Consequently, Congress included a provision in the Defense Authorization Act for Fiscal Year 1998 that provided that the Navy was authorized to “terminate or reduce t he dairy or other operations conducted at the Naval Academy dairy farm located in Gamb rills, Maryland,” but banned sale of the property and required that it s “rural and agricultural nature” be maintained. See National Defense Authorization Act for Fisca l Year 1998, Pub. L. No. 105-85, § 2871, 111 Stat. 1629, 2015-16 (1997) (codified at 10 U.S.C. § 6976). 1 On November 28, 2005, the Navy iss ued a Request of Interest (“ROI”) for proposals to lease the dairy farm property. On January 16, 2006, RCG responded with an Expression of Interest. The Navy, after receiving the ex pressions of interest from RCG and other interested parti es, issued a Notice of Availability for Lease, and requested that all bids be submitted by March 19, 2007. On February 6, 2007, interested bidders toured the property. With the Navy’s written permission, RCG enter ed the property a second time on February 27, 2007, to survey and test the area for the presenc e of sand and gravel . The Navy understood that RCG was entering the proper ty for the purposes of test ing for the presence of sand

1 The statute provided that “the r eal property containing the dairy farm . . . may not be . . . transferred or otherwise disposed of by the Navy or any Federal Agency . . . and . . . shall be maintained in its rural and agricultural nature.” 10 U.S.C. § 6976(a)(2). Furthermore, it provided t hat “[a]ny lease of pr operty at the Naval Academy dairy farm shall be subject to a condi tion that the lessee maintain the rural and agricultural nature of the leased property.” 10 U.S.C. § 6976(b)(2).

2009-5091 2and gravel. 2 RCG then prepared a site analysis, designed mining plans for the property, and submitted a formal lease proposal prior to the March 19, 2007, deadline. The proposal stated that RCG proposed to lease the property in order to mine it for sand an d gravel. On April 30, 2007, a Navy Contracting Offi cer informed RCG that its proposal did not fall within the scope of t he solicitation, because dispos al of real property was prohibited. The contracting officer reas oned that embedded sand and gravel constitutes real property pursuant to 41 C.F.R. § 102-71.20, 3 that mining of sand and gravel constituted disposal of real property, and that 10 U.S.C. § 6976 did not authorize “disposal” of real property. Accordingly, RCG ’s proposal would not be considered. In a later debriefing, the Navy asserted that it had no obligation during the pre-bid preparatory process to adv ise RCG that its bid w ould be unauthorized and did not qualify for review or evaluation. RCG first filed a bid pr otest with the General Accounting Office (“GAO”). The GAO is authorized to decide bid protests concerning an alleged violation of a procurement statute or regulation. See 31 U.S.C. § 3552(a). The Competition in Contracting Act of 1984, Pub. L. No. 98-369, § 2741, 98 Stat. 494, 1199-1203 (codified

2 See Transcript of Record at 9-11, Res. Conservation Group , 86 Fed. Cl. 475 (No. 08-768C).

3 The regulation defines real property for the purposes of the General Services Administration’s real property po licies to include “embedded gravel, sand, or stone.” 41 C.F.R. § 102-71.20. Additionally, other relevant federal regulations also appear to treat disposal of sand and gravel as disposal of real property. See, e.g. , 32 C.F.R. § 644.501 (Department of Army regulation defining standing timber, embedded gravel, sand, and stone as “real property”).

2009-5091 3at 31 U.S.C. §§ 3551-56) defines a “protest” to include “a written objection by an interested party to . . . [a] solicitation or other request by a Federal agency for offers for a contract for the procurement of property or services,” “[t]he cancellation of such a solicitation or other request,” “[ a]n award or proposed award of such a contract,” or “[a] termination or cancellation of an award of such a contract.” 31 U.S.C. § 3551(1). The GAO dismissed RCG’s protest, concluding that “[a] solicitation of offers to lease government-owned land is not a procurement of property or services by a federal agency; thus it is not encompa ssed within our [Competition in Contracting Act of 1984] bid protest authority.” Res. Conservation Group, LLC , B-310831 (Comp. Gen. Nov. 28, 2007). On October 24, 2008, RCG filed suit in the Court of Federal Claims alleging breach of an implied contract of fair and honest consideration, and violation of the Administrative Procedure Act (“APA”), 5 U.S. C. § 706. RCG sough t recovery of bid preparation costs and fees in the amount of $500,000 for th e breach of the implied contract. It appears that RCG wa s not challenging the actual award of the contract, but rather sought recovery for damages incurred due to the government’s failure to timely apprise RCG that its interpretation of 10 U.S.C. § 6976 foreclosed RCG’s bid. 4

4 See Complaint at 5, Res. Conservation Group , 86 Fed. Cl. 475 (2009) (No. 08-768C) (“The Navy breached t he implied contract to judge honestly and fairly all bids submitted in response to the solicitation by disqualif ying RCG with information that it knew or should have known, but failed to disclose to RCG, before RCG incurred the expenses of composing and submitting the formal proposal.”).

2009-5091 4Additionally, RCG alleged that the Navy misint erpreted 10 U.S.C. § 6976 in refusing to consider its bid. 5
The Court of Federal Claim s held that it lacked jurisdiction under 28 U.S.C. § 1491(b)(1) to adjudicate bid protests involvi ng leases of land where the government is the lessor, because such an action is not “in connection with a procurement or proposed procurement.” Res. Conservation Group , 86 Fed. Cl. at 486. The court also held that the enactment of 28 U.S.C. § 1491(b) by the Administrative Dispute Resolution Act (“ADRA”), Pub.L. No. 104-320, § 12, 110 Stat. 3870, 3874-76 (1996), had impliedly repealed the right to sue under an implied-in -fact contract purs uant to 28 U.S.C. § 1491(a)(1), the general Tucker Act jurisdictional provision. Res. Conservation Group , 86 Fed. Cl. at 484-85. With respect to RCG ’s APA claim, the Court of Federal Claims held that it lacked jurisdiction to review an agency decision under the APA (an issue not raised on appeal). Id. at 487. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(3). DISCUSSION RCG argues that 28 U.S.C. § 1491(b) provides a jurisdictional basis for its claim. RCG alternatively argues that re view of bid protests under the implied-in-fact contract of fair and honest consideration pursuant to 28 U.S.C. § 1491(a) survived the enactment of the ADRA and that a breach of the implied-in-fact duty remains a viable theory of
recovery. We review decisions of the Court of Federal Claims regarding subject matter jurisdiction de novo. See Taylor v. United States , 303 F.3d 1357, 1359 (Fed. Cir. 2002).

5 Complaint at 4, Res. Conservation Group , 86 Fed. Cl. 475 (2009) (No. 08- 768C) (“The Navy erroneously interpreted 10 U. S.C. § 6976 to mean t hat a leasehold to a mining operation is outside it s authority because ‘mining’ is the equivalent of the ‘disposal’ of property. Nothing in section 6976 states that the Da iry Farm could not be leased to a mining operation.”).

2009-5091 52009-5091 6 To assess these arguments, we begin by providing an overview of the legislative history of section 1491(b).
I Under the Tucker Act, the Court of Feder al Claims has jurisdiction “to render judgment upon any claim against the United St ates founded . . . upon any express or implied contract with the Unit ed States.” 28 U.S.C. § 1491(a )(1). This jurisdictional grant was construed, prior to the enactment of the ADRA, to authorize suits by disappointed bidders challenging contract awar ds based on alleged improprieties in the procurement process. See Southfork Sys., Inc. v. United States , 141 F.3d 1124, 1132 (Fed. Cir. 1998) (citing Cent. Ark. Maint., Inc. v. United States , 68 F.3d 1338, 1341 (Fed Cir. 1995)). The jurisdictional basis for such suits was the alleged breach of “an implied contract to have the involved bids fairly and honestly considered.” Id. (quoting United States v. John C. Grimberg Co. , 702 F.2d 1362, 1367 (Fed. Cir. 1983) (en banc)); see Heyer Prods. Co. v. United States , 140 F.Supp. 409, 414-15 (Ct. Cl. 1956). Following passage of the APA in 1946, the District of Columbia Circuit in Scanwell Labs., Inc. v. Shaffer , 424 F.2d 859 (D.C. Cir. 1970), held that challenges to awards of government contracts were reviewabl e in federal district courts pursuant to the judicial review provisions of the APA. Id. at 869-75. 6 Thus, for a period both the district courts and the Court of Claims exer cised jurisdiction over bid protests on two

6 Prior to the enactment of the APA, f ederal courts were foreclosed from hearing such actions under Perkins v. Lukens Steel Co. , 310 U.S. 113, 126-27 (1940), in which the Supreme Court held that di sappointed bidders lacked standing to bring such challenges in federal courts.separate theories. 7 The legislative history of the ADRA indicates that the enactment § 1491(b)(1) was motivated by a concer n with forum shopping and fragmentation of government contract law. As the original sponsor of the ju risdictional provision (Senator Cohen) stated, “It is my belief that having mult iple judicial bodies review bid protests of Federal contracts has resulted in forum shopping as litigants search for the most favorable forum. Additionally , the resulting disparate bodies of law between the circuits has created a situation where there is no national unifo rmity in resolving these disputes.” See 142 Cong. Rec. S11848 (daily ed. S ept. 30, 1996) (statement of Sen. Cohen). The ADRA expanded the jurisdiction of the Court of Federal Claims to hear bid protest cases, ultimately giving the court excl usive jurisdiction to review “the full range of procurement protest cases previously subject to review in the federal district courts and the Court of Federal Claim s.” H.R. Rep. No. 104-841, at 10 (1996) (Conf. Rep.). 8 The ADRA also directed the cour t to use the standards of review provided by the APA in reviewing the bid protest suits. 28 U.S.C. § 1491(b)(4).

7 The scope of review by the Court of Claims, however, was limited. Before 1982, review “was narrow and an aggrieved par ty was typically limited to monetary relief,” such as costs associated with undertaking the bidding process. See Emery Worldwide Airlines, Inc. v. United States , 264 F.3d 1071, 1078 (Fed. Cir. 2001); Keco Indus., Inc. v. United States , 492 F.2d 1200, 1203-04 (Ct. Cl. 1974).

8 For a period, the ADRA allowed “both federal district courts and the Court of Federal Claims to hear ‘the fu ll range of cases previously subject to review in either system.’” Emery Worldwide Airlines , 264 F.3d at 1079 (quoting 142 Cong. Rec. S11849 (daily ed. Sept. 30, 1996) (statement of S en. Levin)). However, a sunset provision terminated the federal district courts’ ju risdiction in 2001, eventually channeling all judicial review of procurement protests to the United States Court of Federal Claims. See ADRA § 12(d), 110 Stat. at 3874-76.

2009-5091 7With this background in mind, we turn to the arguments raised by the parties in this case. II We first consider whether RCG’s claim fa lls within the jurisdiction conferred by section 1491(b)(1), the new jurisdictional pr ovision enacted by the ADRA. We conclude that the Court of Federal Claims correctly held that it does not. Section 1491(b)(1) grants the Cour t of Federal Claims 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 t he award of a contra ct or any alleged violation of stat ute or regulation in connection with a procurement or a proposed procurement

. 28 U.S.C. § 1491(b)(1) (emphasis added). Init ially, we consider the meaning of the phrase “in connection with a procurem ent or a proposed procurement.” In construing statutory language, we look to dictionary definit ions published at the time that the statute was enacted. 9 At the time that the A DRA was enacted in 1996, the definition of “procurement c ontract” was “[a] government c ontract with a manufacturer or supplier of goods or machinery or services under the terms of which a sale or service is made to the government.” Black’s Law Dic tionary 1208 (6th ed. 1990). “Procure” was defined as “to get possession of; obtain, acqui re.” Webster’s Third New International Dictionary 1809 (1993). These definitions of “p rocurement” and of “procure” signify the

9 See Carcieri v. Salazar , 129 S. Ct. 1058, 1064 (2009) (referring to Black’s Law Dictionary and Webster’s New International Dictionary for definition of “now” at the time that the Indian Reor ganization Act was enacted); MCI Telecomm. Corp. v. Am. Tel. & Tel. Co. , 512 U.S. 218, 228 (1994) (referring to Webster’s New International Dictionary and Webster’s Collegiate Dictionary for definition of “modify” at the time the Communications Act was enacted).

2009-5091 8act of obtaining or acquiring something, in t he context of acquiring goods or services. It strains the ordinary meaning of “procurement ” to extend that defin ition to encompass a situation in which it is the government t hat is seeking to lease its own property. Moreover, although Congress did not define “procurement” in the Tucker Act, it did define “procurement” in 41 U.S.C. § 403( 2), related to the establishment of the Office of Federal Procurement Policy, an office within the Office of Management and Budget that plays a central role in shapi ng the policies and practices federal agencies use to acquire goods and services. Section 403( 2) states that proc urement “includes all stages of the process of acquiring property or services , beginning with the process for determining a need for property or servic es and ending with contract completion and closeout.” 41 U.S.C. § 403( 2) (emphasis added). In Distributed Solutions, Inc. v. United States , 539 F.3d 1340 (Fed. Cir. 2008), we c oncluded that the definition of “procurement” in 41 U.S.C. § 403(2) shoul d be utilized in determining the scope of section 1491(b)(1), as the statut ory provisions related to t he establishment of the Office of Federal Procurement Policy “give overall direction for federal procurement policies, regulations, procedures, and forms.” 539 F. 3d at 1345. The process involved in soliciting lessees for government-owned proper ty cannot be characterized as a “process of acquiring property or services.” We not e also that the GAO, in construing the “procurement” language, concluded that “[a] so licitation of offers to lease governmentowned land is not a procurement of property or services by a federal agency; thus it is not encompassed within our [C ompetition in Contracting Act of 1984] bid protest authority.” Res. Conservation Group , B-310831 (Comp. Gen. Nov. 28, 2007).

2009-5091 9Additionally, there is no indication in the legislative history that the ADRA was intended to deal with nonprocurem ent protests. Throughout t he legislative history, section 1491(b)(1) is described as applying to “procurement.” See, e.g. , 142 Cong. Rec. S6156 (daily ed. June 12, 1996) (state ment of Sen. Cohen, original sponsor) (“[This] amendment is designed to increase the efficiency of our procurement system by consolidating jurisdiction over bid protest claims in the Court of Federal Claims.” (emphasis added)); H.R. Rep. No. 104-841, at 10 (“This section consolidates federal court jurisdiction for procurement protest cases in the Court of Federal Claims.” (emphasis added)); 142 Cong. Rec. S11849 (daily ed. Sep. 30, 1996) (statement of Sen. Levin) (“[T]he bill would address the . . . issue of judicial jurisdiction over procurement protests .” (emphasis added)). The issue of nonprocurement bid protests is mentioned nowhere in the legislative history. 10 The government agrees that the “procure ment” language in the st atute is limited to the procurement of goods and services. But in an apparent effort to support its

10 The fact that as part of the ADRA Congress repealed former section 1491(a)(3), and enacted its substance as se ction 1491(b)(2), does not suggest that Congress viewed section 1491(b)(1) as encom passing nonprocurement cases. Section 1491(a)(3) provided: “To afford complete relie f on any contract claim brought before the contract is awarded, the cour t shall have exclusive jurisdiction to grant declaratory judgments and such equitable and extraordinary relief as it deems proper, including but not limited to injunctive relie f.” Federal Courts Improvem ent Act of 1982, Pub. L. No. 97-164, § 133, 96 Stat. 25, 39 (current version at 28 U.S.C. § 1491). While that section was not on its face limited to procurement case s, the legislative hist ory of that section enacted in 1982 suggests that Congress intended it to apply only in the procurement context. See Federal Courts Improvement Act of 1981, S. Rep. No. 97-275, at 23 (1981) (amendment described as “conferri ng jurisdiction upon the Claims Court to award injunctive relief in the pre-award stage of the procurement process ”); see generally John C. Grimberg Co. , 702 F.2d at 1372 (discussing legislative history of section 1491(a)(3) and the court’s new jurisdic tion “to award injunctive relief in the preaward stage of the procurement process” (emphasis added)).

2009-5091 10argument discussed below that section 1491(b)(1) provides the exclusive remedy for both procurement and nonprocurement solicitations, the gov ernment argues that the procurement limitation only applie s to challenges to “statute s and regulations” and not to challenges of “awards” and “solicitations.” It suggests that RCG could somehow secure relief if RCG were “to object to either the award or the solicitation . Those are not governed by ‘in connection with a procuremen t.’” Oral Arg. 13:23-13:30. This convoluted argument makes no s ense, and is based entirely on the theory of the last antecedent, i.e., that the “procurement” language appears immediately after the “any violation of statute or regulation” language. See, e.g. , Anhydrides & Chems, Inc. v. United States , 130 F.3d 1481, 1483 (Fed. Cir. 1997) (holding that referential and qualifying words and phrases, where no contrary intention appears, refer solely to the last antecedent, which consists of “the last wo rd, phrase, or clause that can be made an antecedent without impairing the m eaning of the sentence”) (citat ions omitted). But we have made clear that that doctr ine provides only marginal assistance, and is overcome by other factors showi ng a different meaning. Finisar Corp. v. DirecTV Group., Inc. , 523 F.3d 1323, 1336 (Fed. Cir. 2008). Here it is cl ear, for the reasons described above, that 1491(b)(1) in its entirety is exclusively c oncerned with procurement solicitations and contracts. Moreover, it is quite unlikely that Congress would have allowed the Court of Federal Claims to exercise jurisdiction in nonpr ocurement bid protests in the case of a challenge to an award, proposed award, or solicitation, but not in the case of a challenge to a violation of a statute or regulation. Thus, the Court of Federal Claims was correct in holding that relief under 1491(b)(1) is unavailable outsi de the procurement context.

2009-5091 11III We next address whether the im plied-in-fact contract jurisdiction under 28 U.S.C. § 1491(a)(1) that existed prio r to 1996 survived the enactment of the ADRA, a question that we had previously reserved in Emery Worldwide Airlines , 264 F.3d 1071, 1081 n.9 (Fed. Cir. 2001), and Impresa Construzioni Geom. Dome nico Garufi v. United States , 238 F.3d 1324, 1332 n.6 (Fed. Cir. 2001). Contrary to the Court of Federal Claims, we conclude that implied-in-fact contract jurisd iction does survive as to claims where the new statute does not provide a remedy. Before enactment of section 1491(b)(1), the Court of Federal Claims exercised jurisdiction over solicitations for the sale of government property, just as it did in the procurement area. 11 The new statute on it s face does not repeal the earlier jurisdiction. The government argues, however, that continuat ion of the implied-in-fact jurisdiction would be inconsistent with t he purposes of the ADRA, whic h clearly was designed to place all bid protest challenges in a single c ourt (after a sunset period) under a single standard (the APA standard). We agree that Congress intended the 1491( b)(1) jurisdiction to be exclusive where 1491(b)(1) provided a remedy (in procur ement cases). The legislative history makes clear that the ADRA wa s meant to unify bid protes t law in one court under one standard. However, it seems quite unlikely that Congress would intend that statute to

11 See, e.g. , Prineville Sawmill Co . v. United States , 859 F.2d 905, 909 (Fed. Cir. 1988) (holding that the Claims Court had juri sdiction to review the Forest Service’s actions in rejecting a responsive bid it rece ived in connection with the sale of federally owned timber, as an invitation for bids issued by the government carries “an implied contractual obligation to fairly and hones tly consider all responsive bids”); Monchamp Corp. v. United States , 19 Cl. Ct. 797, 800-02 (1990) (deciding merits of case in which plaintiff alleged that the Forest Service failed to consider its bid fairly).

2009-5091 12deny a pre-existing remedy without provid ing a remedy under t he new statute. See,
e.g. , Davis v. Passman , 442 U.S. 228, 247 (1979) (hol ding that by enacting an amendment to the Civil Rights Act of 1964 wh ich protects federal employees from discrimination, Congress did not intend to fo reclose pre-existing alternative remedies available to those expressl y unprotected by the statute). Indeed, the Conference Report to the ADRA provides: It is the intention of the Managers to give the Court of Federal Claims exclusive jurisdiction over the full range of procurement protest cases previously subject to review in the federal district courts and the Court of Federal Claims. This section is not intended to affect the jurisdiction or standards applied by t he Court of Federal Claims in any other area of law

. H.R. Rep. No. 104-841, at 10 (emphases added). This passage confirms that Congress did not intend to alter or restrict the Cour t of Federal Claims’ existing jurisdiction in cases not covered by the new st atute. Similarly, the repeal of district court jurisdiction over bid protests in the ADRA made clear that the district court jurisdiction was repealed only where the new jurisdiction was substituted. Section 12(d) of the Act provided that “the jurisdiction of the district courts of t he United States over t he actions described in section 1491(b)(1) of title 28, United States Code . . . shall terminate on January 1, 2001 unless extended by Congress.” ADRA § 12(d), 110 Stat. at 3874-76. 12 We conclude that the court’s implied-in-fact jurisdiction over nonprocurement solicit ations survived the enactment of 1491(b)(1). Admittedly, dividing jurisdiction betw een the Court of F ederal Claims and the district courts for nonprocurement bid protests may lead to similar problems that led to

2009-5091 132009-5091 14 the enactment of 1491(b)(1). Ho wever, if the statute is to be amended to solve this problem, that amendment must be underta ken by Congress and not this court. Finally, the government argues that we s hould affirm on the merits because its construction of 10 U.S.C. § 6976 is correct. We decline to construe that statute for the first time on appeal, but we note that even if the government’s construction were correct, that would not necessarily defeat RCG’s claim. That claim is based in part on the government’s alleged unfairness in failing to advise RCG early in the process of the construction of section 6976 that made its proposed bid unacceptable. We express no opinion on whether the government was obli gated to inform potential bidders of the perceived limitations impos ed by 10 U.S.C. § 6976. CONCLUSION We conclude that the Court of Federal Claims did not have jurisdiction under 28 U.S.C. § 1491(b)(1), but had jurisdiction under section 1491(a)(1) because the impliedin-fact contract jurisdiction in nonprocurement cases that existed prior to 1996 survived the enactment of the ADRA.
AFFIRMED IN PART , REVERSED IN PART , AND REMANDED COSTS No costs.

12 Thus, a disappointed bidder in a nonprocurement case could also theoretically bring its bid protest challenge in a federal di strict court, since the ADRA only repealed jurisdiction over procurement cases.