Court Opinion

ID: 854680
Source: CourtListenerOpinion
Date Created: 2013-03-08 17:15:55.564896+00
Date Added: 2024-06-11T13:12:03.335176
License: Public Domain

IN THE UNITED STATES COURT OF FEDERAL CLAIMS
N . 11-535€
(Classified Opini0n and (:)rder_ Filed: December 31, 2012)
(Filed Under Seal: March S, 2013)
(Reissued: March 8, 2013)1

(Bid Pr0test)
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* Supplementation 'of the
NCL LOGISTICS COMPANY, * Administrative Record;
* Nonresponsibility Determination;
Plaintiff, * De Fact0 Debarment; Due Process;
* National Security; Disparate
v. * Treatment.
*
THE UNITED STATES, *
*
Defendant. *
*

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Jonathan D. Shaffer, Smith Pachter McWhorter PLC, 8000 'l`owers Crescent Drive, Suite
900, Tysons Corner, V.A. 22182, for Plaintiff. John S. Pachter, Marv Pat Buckenmever, and
Andrew J. Foti, Smith Pachter McWhorter PLC, and Mary Beth Bosco and Erik M. Dullea,
Patton Boggs LLP, 2550 M Street, N.W., Washington, D.C. 20037, of Counsel.

Tonv West, Jeanne E. Davidson, Kirk Manhardt, and William P. Rayel, Commercial
Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C. 20044,
for Defendant. Elizabeth Witwer, Commercial Litigation Branch, Civil Division, Department of
Justice, and Scott N. F1esch, United States Army Contract and Fiscal Law Division, of Counsel.

OPINION AND ORDER

WILLIAMS, Judge.

In this post-award bid protest, NCL Logistics Company ("NCL") challenges its
nonresponsibility determination and exclusion from the competition in the National Afghan
Trucking ("NAT") multiple-award procurement for trucking services in Afghanistan. The

1 This opinion was issued as a classified opinion on December 31, 2012. On February
27, 2013, the parties proposed a public version. Adopting the redactions proposed by the parties,
the Court issued this opinion under seal on March 5, 2013, and invited the parties to submit any
objections by March 7, 2013. No objections having been received, the Court publishes this
opinion with the redactions proposed by the parties.

Department of the Army ("Army") disqualified NCL from receiving an award on the ground that
NCL was nonresponsible, a determination NCL seeks to overtum.

This matter comes before the Court on the parties’ cross-motions for judgment on the
Administrative Record ("AR") and Plaintiff’ s request for declaratory and injunctive relief.
Because NCL has failed to demonstrate that NCL’s nonresponsibility determination was
arbitrary, capricious, or illegal, the Court grants Defendant’s motion for judgment on the
Administrative Record.

Findings of Factz
The Solicitation

On February 22, 20ll, the Army issued solicitation number W9lB4N-ll-R-5000 for
NAT services in Afghanistan. The purpose of the NAT contract was to provide a secure and
reliable means of distributing reconstruction material, security equipment, fuel, miscellaneous
dry cargo, and life support assets to operating bases and distribution sites throughout the
combined joint operations area in Afghanistan. The Army anticipated the award of indefinite
delivery/indefinite quantity contracts for trucking services in three suites: Suite l for bulk fuel,
Suite 2 for dry cargo, and Suite 3 for heavy cargo. AR 388. The NAT procurement was
essentially a follow-on procurement to the prior Host Nation Trucking ("HNT") contract, which
had covered substantially the same mission requirements. The Army awarded NAT contracts to
20 contractors, none of whom had been HNT prime contractors.3

The solicitation stated the Army would make awards based on "lowest price technically
acceptable" proposals in accordance with Federal Acquisition Regulation ("FAR") l5.l0l-2.4
Proposals were to be evaluated using two criteria: technical capability and price. AR 391. The
solicitation stated that the Govemment would evaluate offerors for responsibility in accordance
with FAR 9.1. AR 393-94. FAR 9.l04-l provides:

To be determined responsible, a prospective contractor must_

(a) Have adequate financial resources to perform the contract, or the ability to obtain
them (see 9.l04-3(a));

2 The findings of fact are derived from the classified and unclassified portions of the
Administrative Record. Citations to "AR" are to the unclassified portions of the Administrative
Record, and citations to "NCL" or "REF" are to the classified portions.

3 One HNT prime contractor, Anham, was subsequently awarded a NAT contract on
February 7, 20l2, after it was evaluated for responsibility following the settlement of its bid
protest.

4 All references to the FAR are to Title 48 of the Code of F ederal Regulations as codified
at the time of NCL’s responsibility determination on August l0, 201 l.

2

(b) Be able to comply with the required or proposed delivery or performance schedule,
taking into consideration all existing commercial and governmental business
commitments;

(c) Have a satisfactory performance record (see 48 CFR 9.104-3(b) and part 42, subpart
42.15) . . . .

(d) Have a satisfactory record of integrity and business ethics (for exarnple, see Subpart
42. 1 5).

(e) Have the necessary organization, experience, accounting and operational controls,
and technical skills, or the ability to obtain them (including, as appropriate, such
elements as production control procedures, property control systems, quality assurance
measures, and safety programs applicable to materials to be produced or services to be
performed by the prospective contractor and subcontractors) (see 9.104-3(a));

(f) Have the necessary production, construction, and technical equipment and facilities,
or the ability to obtain them (see 9.104-3 (a)); and

(g) Be otherwise qualified and eligible to receive an award under applicable laws and
regulations . . . .

Submission of Proposals and NCL’s Resnonsibilitv Evaluation

NCL timely submitted its proposal for all three NAT suites. AR 46l7-94, 4778-4961,
5063-5149. NCL listed the HNT contract as a reference for itself and for two of its proposed
subcontractors. AR 4671, 4675-77. On July 29, 2011, the Army eliminated all bidders whose
proposals failed either the technical or price requirements, and forwarded the remaining
proposals for responsibility determinations. AR l7768-810. By letter dated Ju1y 30, 201l, the
contracting officer informed NCL that its responsibility evaluation was ongoing and listed
several areas of concern relating to NCL’s performance of the HNT contract. AR 16239-41.
The contracting officer issued a corrected version of this letter on August 1, 2011.5 AR 16249-
51. The contracting officer requested that NCL provide responses addressing the circumstances
giving rise to the areas of concem, identifying any mitigating circumstances, and outlining the
corrective action taken to prevent reoccurrence. AR l6249-51. Adverse information involved
NCL’s noncompliance with ln-Transit Visibility ("ITV") contract requirements, failure to
provide deliverables, transponder stacking throughout the life of the contract, forged
Transportation Movement Requests ("TMRS"), the use of an unauthorized private security
company, Watan Risk Management ("Watan"), failure to meet Private Security Contractor
("PSC") Arming Requirements, withholding of contract payments for failed missions, canceled
no-pay missions, pilferage/backcharges, fuel backcharges, and use of a subcontractor that

5 The contracting officer changed a reference to "reoccurring instances of submission of
forged Transportation Movement Requests (TMRs)" in the July 30, 2011 letter, to "reoccurring
instances of Transponder Stacking" in the August 1, 2011 letter. AR 16240, 16250.

received customer complaints. I_586
F.3d 1372, 1373 (Fed. Cir. 2009). Pursuant to the APA, this Court may set aside an agency
action that was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with
law." 5 U.S.C. § 706 (2)(A); Ala. Aircraft Indus., 586 F.3d at 1373.

An agency action is arbitrary and capricious when the agency "‘entirely failed to consider
an important aspect of the problem, offered an explanation for its decision that runs counter to
the evidence before the agency, or [the decision] is so implausible that it could not be ascribed to
a difference in view or the product of agency expertise."’ Ceres Envtl. Servs., lnc. v. United
States, 97 Fed. Cl. 277, 302 (2011) (quoting Ala. Aircraft Indus., 586 F.3d at 1375)). An
"agency must examine the relevant data and articulate a satisfactory explanation for its action
including a ‘rational connection between the facts found and the choices made."’ In re Sang-Su
Le_e_, 277 F.3d 1338, 1344 (Fed. Cir. 2002) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm
Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)).

"Contracting officers are afforded considerable discretion in negotiated procurements,
such as this one, where award is premised on a ‘best value’ determination." Ceres Envtl. Servs.
@, 97 Fed. Cl. at 302 (citing Banknote Corp. of Am., lnc. v. United States, 365 F.3d 1345,
1355 (Fed. Cir. 2004)). Importantly, "[c]ontracting officers are ‘ generally given wide discretion’
in making responsibility determinations and in determining the amount of information that is
required to make a responsibility determination." Imnresa Construzioni Geom. Domenico
Garufi v. United States, 238 F.3d 1324, 1334-35 (Fed. Cir. 2001) (quoting John C. Grimberg Co.
v. United States, 185 F.3d 1297, 1303 (Fed. Cir. 1999)); see also News PrintinQ Co. v. United
States, 46 Fed. Cl. 740, 746 (2000) ("‘A contracting agency has broad discretion in making

 

12 Anham had previously filed suit in this Court challenging its exclusion from the
competitive range. On September 30, 2011, Anham and the Govemment stipulated to the
dismissal of Anham’s lawsuit based upon a settlement agreement in which the Govemment
agreed to resume the evaluation of Anham’s proposal.

13

responsibility determinations since it must bear the brunt of difficulties experienced in obtaining
the required perforrnance."’) (quoting House of Commc’ns & Graphics, B-245920, 1992 WL
55054, at *2 (Comp. Gen. Mar. 4, 1992). "When such decisions have a rational basis and are
supported by the record, they will be upheld." Bender Shipbuilding & Rer)air Co. v. United
States, 297 F.3d 1358, 1362 (Fed. Cir. 2002). Plaintiff has the burden of establishing that the
responsibility determination was arbitrary and capricious. Impresa, 238 F.3d at 1337.

1n resolving bid protests, the trial court is to make findings of fact weighing the evidence
in the administrative record. § Bannum, lnc. v. United States, 404 F.3d 1346, 1355 (Fed. Cir.
2005). If the protestor succeeds in demonstrating an error in the procurement process, the Court
then proceeds to determine, as a factual matter, whether the protestor was prejudiced by that
error. -

Supplementation of the AR

NCL seeks leave to supplement the AR with the following categories of documents: (1)
communications between the HNT contracting officer and NCL relating to NCL’s HNT
performance and corrective action, (2) materials from an appeal pending before the Armed
Services Board of Contract Appeals ("ASBCA") concerning a dispute between the Army and
NCL under the HNT contract, including a revised final decision, an expert report, and deposition
testimony, and (3) documents addressing NCL’s relationship with Watan, including materials
relating to Congressional investigations and declarations from NCL employees. NCL also seeks
to supplement the Court’s record with a decision of the Army’s Suspension and Debarment
Official ("SDO") terminating the referral for proposed debarment of another HNT contractor,
Guzar Mirbachakot Transportation ("GMT").

The Court grants the requested supplementation in part, adding correspondence between
the Army and NCL describing NCL’s performance problems and corrective action under the
HNT contract, a revised final decision of the HNT contracting officer reducing NCL’s liability
for failed fuel missions, and some documents relating to Plaintiff’ s relationship with Watan
which were close at hand and relevant to the nonresponsibility deterrnination. Tabs 133-3 7, 139-
42, 144-48, 150-54, 158, 171 .13 The Court denies supplementation with other ASBCA discovery
materials and documents concerning Plaintiff" s relationship with Watan, The Court denies
Plaintiff’s motion to supplement the Court record with the SDO’s decision terminating Gl\/l"l"s
proposed debarrnent.

I. Communications Between NCL and the Army under the HNT Contract (Tabs 137, 139,
142, 145-48, 150, 1581

NCL seeks to supplement the AR with communications between NCL and the
contracting officer addressing performance concerns cited in NCL’s nonresponsibility

13 The Army does not object to supplementing the AR with specified documents that
NCL requested, Tabs 133-136, 140-41, and 151, and parts ofTabs 139, 145, and 150 (AR 21486,
21512, 21530). Def.’s Resp. to Pl.’s Mot. to Supplement the Admin. R. 1-2. As such, these
documents are added to the record.

14

determination and NCL’s corrective actions. § Tabs l37, 139, 142, 145-48, 150, 158. As the
United States Court of Appeals for the Federal Circuit recognized in Axiom Resource
Management lnc. v. United States, supplementation of the record in a bid protest should be
limited to cases in which "‘the omission of extra-record evidence precludes effective judicial
review."’ 564 F.3d 1374, 1380 (Fed. Cir. 2009) (quoting Murakami v. United States, 46 Fed. Cl.
731, 735 (2000), aff’_d 398 F.3d 1342 (Fed. Cir. 2005)). Further, the determination of whether to
supplement the AR must be made in the context of the solicitation requirements. Ne. Military
Sales, lnc. v. United States, 100 Fed. Cl. 96, 97 (2011) ("Where . . . the Solicitation indicates that
the agency will consider all materials of a particular type in its evaluation of offers, the
Administrative Record is not complete if it omitted any such materials."). Here, the solicitation
expressly provided that corrective action to remedy past performance problems would be
considered in the responsibility assessment. AR 394. NCL listed the HNT contract as a
reference in its proposal and cited its corrective action under the HNT contract in connection
with the NAT contracting officer’s responsibility evaluation. § AR 4671, 16260-66. In
Northeast Militarv Sales, the Court permitted supplementation of the AR with pricing surveys,
an internal agency quality control checklist, and an internal inspector General’s report, all of
which contained relevant past performance information about the awardee. Ne. Milit@; Sales,
lg_c_., 100 Fed. Cl. at 98-100. Similarly, in the instant case, communications with the Army that
reflect NCL’s performance and corrective action on the HNT contract are properly added to the
AR.

II. Documents from the Ongoing ASBCA Proceeding (Tabs 154, 155, and 172)

NCL seeks to include three documents produced during an appeal it is currently litigating
before the ASBCA, challenging the HNT contracting officer’s determination that NCL is liable
for $1,320,822.12 for 100 failed fuel missions, These documents are a revised contracting
officer’s final decision, an alleged expert handwriting report, and a deposition.

A. The HNT Contracting Off`icer’s Revised Final Decisijon (Tab 154)

In NCL’s nonresponsibility determination, the NAT contracting officer cited NCL’s
withholding of $5,272,125.20 under the HNT contract, which included $l,320,822.l2 for
missing fuel, based on a March 17, 2010 final decision of the HNT contracting officer. § NCL
8, Tab 154 at 21558-59. However, on August 10, 2011, an HNT contracting officer, Maj.
Edward Gosline, issued a revised final decision under the HNT contract reducing NCL’s liability
for this missing idel, by more than half, to $609,519.14. Tab 154 at 21557.14 Plaintiff seeks to
include this revised decision absolving NCL from liability for 61 of these 100 failed fuel
missions as a supplement to the AR.

14 The original March 17, 2010 decision finding NCL liable for missing fuel determined
that NCL did not successfully complete 61 of the 100 fuel missions because it failed to deliver
the fuel within 21 days as required by a March 2010 revision to the HNT contract’s Statement of
Work ("SOW"). Tab 154 at 2155 8-59. Because 61 of NCL’s allegedly failed missions occurred
prior to the March 2010 revision of the SOW -- when the 21-day deadline was not in effect --
Maj. Gosline issued a revised final decision validating these 61 missions, Tab 154 at 215 57.

15

In finding NCL nonresponsible, Contracting Officer Price did not consider the
Government’s substantial reduction of NCL’s withholding liability in the revised final decision.
§ NCL 8. Because the original determination of withholding liability was a basis for NCL’s
nonresponsibility determination and the revised final decision is the Government’s own
determination that this original decision was incorrect, the revised decision ought to be part of
the AR. § Am. Petroleum lnst. v. EPA, 540 F.2d 1023, 1034 (10th Cir. 1976) ("[E]vents
indicating the truth or falsity of agency predictions should not be ignored."); Amoco Oil Co. v.
Q_A_, 501 F.2d 722, 729 n.10 (D.C. Cir. 1974) (stating that "by the time judicial review is
secured events may have progressed sufficiently to indicate the truth or falsity of agency
predictions."); Afghan Am. Army Servs. Corp. v. United Sates, 106 Fed. Cl. 717, 724-26 (2012).

As courts have recognized, post-decisional information correcting erroneous
assumptions, predictions, or facts forming the predicate for agency decision-making must be
added to the administrative record to permit effective judicial review. ln the context of agency
rulemaking, the D.C. Circuit ruled that while "[a] reviewing court must tread cautiously in
considering events occurring subsequent to promulgation of a rule . . . testimony [that] bears
directly upon the plausibility of certain predictions made by the Administrator in promulgating
the Regulations . . . shall [be] accept[ed] . . . into the record." Amoco Oil Co., 501 F.2d at 729
n.10. Indeed, "[a]llowing a protest to be decided upon an AR which does not reflect what
actually transpired would perpetuate error and impede and frustrate effective judicial review."
Ashbritt, lnc. v. United States, 87 Fed. Cl. 344, 366 (2009) (citing Axiom, 564 F.3d at 1381); s_e§
also Afghan Am. Army Servs. Corr)., 106 Fed. Cl. at 724-26. Accordingly, the revised final
decision issued by Maj. Gosline is properly part of the AR.

B.i The Alleged Handwritinsz Exnert’s Report (Tab 155)

NCL proposes to supplement the AR with the report of a purported handwriting expert,
which NCL claims refutes the Govemment’s allegation that NCL forged signatures on mission
sheets for the remaining 39 failed fuel missions. Tab 155 at 21589-607. NCL’s proffered expert
in the ASBCA proceeding, Mr. Gideon Epstein, compared the signatures on the mission sheets to
the "verbatim known handwriting" of Army personnel who allegedly signed the mission sheets,
and concluded that the signatures on 33 of the 39 mission sheets were genuine. Tab 155 at
215 96-97.15 Although Plaintiff claims that Mr. Epstein’s report confirms that NCL never forged
mission sheets, Plaintiff has not suggested that the ASBCA made such a finding. Nor does the
record reflect that the ASBCA determined Mr. Epstein to be an expert based upon his
knowledge, skill, experience, training, or education. Moreover, the record does not indicate

15 Mr. Epstein found that one mission sheet could not be examined due to the quality of
the document and that another mission sheet was not signed by the same person who had given
the handwriting sample. Tab 155 at 21597. Mr. Epstein could not conduct an analysis of the
four remaining mission sheets because one mission sheet did not include a signature, and the
other three did not have a verified signature from the individual whose signature was on the
disputed mission sheet. I_d.

16

whether Mr. Epstein was subject to cross examination or whether the government proffered a
rebuttal expert 6

This Court recognizes that it is appropriate to supplement the record with expert
testimony when necessary to assist the Court in understanding technical or complex information
involved in a challenged procurement. § Guzar l\/lirbachakot Transp. v. United States, 104
Fed. Cl. 53, 63 (2012); East West, lnc. v. United States, 100 Fed. Cl. 53, 57 (2011); Hunt Bldg.
Co., Ltd. v. United States, 61 Fed. Cl. 243, 272 (2004) (allowing supplementation of the record
with expert testimony to "assist the court in understanding the financing [of] the [p]roject");
Mike Hooks, lnc. v. United States, 39 Fed. Cl. 147, 158 (1997) (noting that supplementation was
appropriate in order for the Court to understand technical solicitation language regarding
"minimum production rates" for shoal dredging). Rather than offering expert testimony to assist
the Court in understanding complex or technical information, NCL is asking this Court to adopt
wholesale an untested expert report and, from that, make a factual finding that NCL never forged
certain mission sheets. Because the report is hearsay, has not been subject to cross-examination
or rebuttal, and this Court has not accepted Mr. Epstein as an expert, observed his demeanor, or
evaluated his credibility, this untested report lacks probative value. C_f. L-3 Commc’ns
integrated Svs., L.P. v. United States, 91 Fed. Cl. 347, 358 (2010) (finding that the Federal Rules
of Evidence should be applied to materials that are extra-record supplementation of the AR to
ensure their reliability). As such, the report is not necessary for effective judicial review.

C. Deposition Testimonv of an HNT Contracting Officer (Tab 172)

NCL also seeks to supplement the AR with the deposition of Lt. Col. l\/Iacintyre, an HNT
contracting officer, to support NCL’s claim that "it had a satisfactory performance record" at the
time of NCL’s responsibility deterrnination. Pl.’s Second Mot. to Supplement the AR 3; 'l`ab 172
at 22515-70.17 in his deposition Lt. Col. Macintyre discussed methods for calculating
withholding for fuel charges and analysis of fuel mission sheets as well as some of NCL’s
performance and corrective actions under the HNT contract. Tab 172 at 22534-39. The cure
notices and letters of concern issued by Lt. Col. Macintyre to NCL and NCL’s responses are in
the AR.18 Because Lt. Col. Macintyre’s deposition testimony is merely a retelling of information
already in the AR and does not amplify or correct findings made in NCL’s responsibility
evaluation, it is not an appropriate supplement to the AR. Furthermore, Lt. Col. Macintyre was
deployed out of Afghanistan in October, 2010, and his testimony offers an incomplete picture of
NCL’s performance under the HNT contract, which concluded in September, 2011, 'l`ab 172 at
22569. After Lt. Col. Macintyre left Afghanistan, the Army notified NCL of additional

16 The parties have not sought to include in this record any materials from the ASBCA
litigation other than Mr. Epstein’s expert report, the revised final decision, and a deposition.

17 Tab 161 at 21668-78 is a redacted transcript of a portion of Lt. Col. Macintyre’s
deposition. Tab 172 at 22515-70 is the complete, unredacted transcript.

18 By agreement of the parties, the following documents are added to the AR: Tabs 133-
35 and 141. As explained above, the Court determined that Tabs 137, 139, and 142, which
include communications between NCL and Lt. Col. MacIntyre, are properly included in the AR
because they reflect NCL’s HNT performance and corrective action.

17

performance shortcomings, including noncompliance with ITV requirements and use of an
unauthorized private security contractor. §§ NCL 3. Because he did not observe the entirety of
NCL’s performance, Lt. Col. Macintyre’s testimony does not accurately evaluate NCL’s overall
performance on the HNT contract and is not properly added to the AR.

III. Documents Relating to NCL’s Alleged Relationship with Watan

NCL also seeks to supplement the AR with documents relating to any suggestion that
NCL has a contract relationship with Watan. The contracting officer cited NCL’s use of Watan,
an unauthorized security subcontractor, as a basis for NCL’s nonresponsibility determination,
stating:

NCL was issued a Letter of Concem dated 23 May 2011 under [the HNT contract] for
failure to utilize an authorized PSC during a mission which was a direct violation of the
contract requirements. This further substantiates NCL’s lack of accountability in
fulfillment of the contract requirements.

NCL 5 . The May 23, 2011 letter of concem described an incident in which an NCL truck was
escorted by Watan, and an NCL employee’s comment that "it was common practice to switch to
Watan PSC, when convoys moved South of Ghazni." Tab 151 at 21532. From this, the HNT
contracting officer concluded that a relationship existed between NCL and Watan and requested
that NCL provide a response, including "[a]n explanation of how long [Watan] has been
escorting NCL trucking missions." icf NCL responded, stating:

NCL does not have and has never had a subcontract with [Watan] under its Host Nation
Trucking Contract. NCL accordingly has not engaged [Watan] to escort its trucking
missions directly. NCL’s trucking contractors hire the security providers, and NCL has
provided each of its trucking subcontractors written instruction to refrain from using
[Watan] on their HNT missions.

AR 16329.
Despite NCL’s arguments to the contrary, the NAT contracting officer concluded in her

nonresponsibility determination that NCL had not substantiated that [
] NCL 8. The contracting officer further concluded that [

. ." NCL 9.
NCL requests supplementation of the AR with a host of documents pertaining to the
contracting officer’s suggestion that NCL had a continuing relationship with Watan. These

materials fall into six categories:

1) Communications between NCL and the Army Relating to NCL’s Relationship with
Watan

18

2) NCL’s Subcontracts with Trucking Companies

3) Materials Pertaining to Mirzada Transport & Logistics Co.’s ("MTC") Relationship with
Watan and NCL’s Contract Dispute with MTC

4) Transcript of a September 15, 2011 Hearing Held by the House Oversight and
Government Reforrn Subcommittee on National Security, Homeland Defense and
Foreign Operations on Defense Department Contracting in Afghanistan

5) NCL’s Notes from Meetings with the |Army in 2009
6) Declarations from NCL’s Former Vice President and President and Owner.

1) Communications between NCL and the Army Relating to NCL’s Relationship with
Watan (Tabs 144, 152, 153. 171)

NCL seeks to include its correspondence responding to the Army’s May 23, 2011 letter
of concern and documents referenced in that letter. Specifically, NCL requests supplementation
with a May 12, 2011 letter it sent to the HNT contracting officer denying NCL ever had a
subcontract with Watan and attaching notices to its subcontractors to refrain from using Watan
for HNT contract services. Tab 171 at 22514, Tab 144 at 21506-11, Tab 153 at 21539-44. NCL
also seeks to include the following additional responses to the May 23, 2011 letter of concern:
(1) two memoranda authored by NCL’s employee John Smith indicating that NCL’s trucking
subcontractor that joined the Watan-escorted convoy did not have a contract with Watan to
provide convoy security, (2) an incident report regarding the truck escorted by Watan, (3)
amendments to NCL’s subcontracts prohibiting use of Watan, and (4) a purported subcontract
between NCL’s subcontractor B&Q and security subcontractor Salarzai. Tab 152 at 21533-35,
Tab 153 at 21536-56.19 Because this material was part of NCL’s response to the HNT
contracting officer’s request for further information regarding NCL’s relationship with Watan, it
is properly added to the AR. § Acrow Corp. v. United States, 96 Fed. Cl. 270, 277 (2010)
("Without encroaching on the broad discretion afforded a contracting officer’s responsibility
determination, the court may supplement the record where necessary to review the contention
that the contracting officer did not pursue impeaching material bearing on issues that she deemed
important, provided that it was at the time as readily available as the material that she
considered.").

2) NCL’s Subcontracts with Trucking Companies (Tabs 126, 130, and 131)

NCL asks that its subcontracts with Mirzada Transport Logistics Co. ("MTC"), Shneez
Transportation Services, and Gulalai Transportation Company, for services on the HNT contract
be added to the record, presumably to support an inference that if NCL had these other
subcontracts, it did not have a subcontract with Watan. _S_e§ Tab 126 at 21289-322, Tab 130 at

19 The document that NCL identifies as a subcontract between B&Q and Salarzai is not in
English, but the parties do not dispute that the proffered document was correctly identified.

19

21343-83, Tab 131 at 21384-419. The NAT contracting officer, however, did not find that NCL

had a [ ] -- she found that NCL had [ ] and had not
substantiated that [ ]. NCL’s formal subcontracts with
these other companies are not probative [ ]. As such, they are not

necessary for effective judicial review of the responsibility deterrnination.

3) Materials Pertaining to MTC’s Relationship with Watan and NCL’s Contract Dispute
with MTC (Tabs 128, 132, 138, 143, 149, and 156)

Plaintiff seeks to supplement the AR with documents pertaining to NCL’s contract
dispute with its subcontractor, MTC, and MTC’s subcontract with Watan. These materials
include (1) four letters describing the termination of NCL’s subcontract with MTC in December,
200920 and NCL’s withholding of payment owed to MTC after MTC’s Chief Executive made
statements to the media confirming that MTC made payments to the Taliban, (2) NCL’s response
to a Congressional investigation indicating that MTC used Watan for convoy security, and (3)
email exchanges between NCL and the Army and NCL and MTC pertaining to an Army request
for identification of NCL’s armed employees, including Watan. § Tab 128 at 21330-32,21 Tab
132 at 21420-33, Tab 138 at 21483-85, Tab 143 at 21503-5, Tab 149 at 21518-29 and Tab 156 at
21608-1 1.

Plaintiff’s request to supplement the AR with these materials is unfounded. The
proposed materials do not discredit or correct the contracting officer’s business judgment that "it

has not been substantiated that the [ ] NCL
12. While Plaintiff suggests that NCL necessarily [ ] when it
terminated its subcontract with MTC on December 5, 2009, the termination of NCL’s
subcontract with MTC does not establish [ ].

Moreover, in its motions to supplement, Plaintiff ignored classified material regarding

[ ] The documents NCL seeks to add to the AR are more remote
and less probative than information in the classified AR the contracting officer relied upon which
addressed [ ] in some detail. Citing [ ] reporting, the
contracting officer determined that [

] NCL 8. The
contracting officer referenced [ ] indicating that [

] NCL 12-13.
The contracting officer also noted based upon [ ] reporting that [

2° NCL and MTC agreed to terminate their contract after MTC had failed to submit HNT
mission sheets to NCL in a timely manner, MTC had failed to deliver cargo, and MTC indicated

it would begin to work with other HNT prime contractors, in contravention of its exclusivity
agreement with NCL. Tab 132 at 21420-21.

21 Tab 128 also includes email exchanges between NCL and its subcontractors that do not
reference Watan. Tab 128 at 21333-38.

20

_ ] NCL
13. The contracting officer found that "NCL Holdings’ [ ] . . . confirmed that

l
] and that [

] NCL 13. 'l`his peripheral
information regarding MTC does not alter or correct the [ ] on which the
contracting officer relied. The Court denies supplementation with Tabs 128, 132, 138, 143, 149,
and 156.

4) Transcript of a September 15. 2011 Hearing Held by the House Oversight and
Government Reform Subcommittee on National Securitv, Homeland Defen_se and
Foreign Operations on Defense Department Contracting in Afghanistan (Tab 157)

NCL also requests supplementation with the transcript of a September 15, 2011
congressional hearing on corruption and DoD contracting in Afghanistan that postdated NCL’s
responsibility deterrnination. §ee_ Tab 157 at 21612-57. The transcript includes the global
assertion that HNT contractors made payments to insurgents and warlords for convoy security in
Afghanistan, but does not identify NCL specifically. Moreover, the transcript is duplicative of
information in [ ]’s report, which states: [

] NCL165. As
such, this transcript is not necessary for effective judicial review of NCL’s nonresponsibility
deterrnination. § PlanetSpace, lnc. v. United States, 90 Fed. Cl. 1, 9-10 (2009) (denying
supplementation with paragraphs of a declaration that are "duplicative of material in the existing
record, and their omission would not ‘f`rustrate effective judicial review."’) (citing Axiom, 564
F.3d at 1381); Kerr Contractors, lnc. v. United States, 89 Fed. Cl. 312, 335 (2009) (denying
supplementation with a requested declaration that is duplicative of information in the AR
because it "add[s] nothing to a record which already presents such inforrnation.").

5) NCL’s Notes from Meetings with the Army in 2009 (Tabs 127 and 129)

'l`he Court denies supplementation with notes taken by NCL’s personnel at meetings with
the Army. § Tab 127 at 21323-29, Tab 129 at 21339-42. These notes do not reference [
] and Plaintiff has not laid the evidentiary foundation for these
documents. §§g L-3 Commc’ns integrated Svs., L.P., 91 Fed. Cl. at 358. NCL did not submit a
declaration authenticating the notes or substantiating that they were made contemporaneously
with the meetings they purportedly describe. Nor did NCL provide these notes to the NAT
contracting officer for consideration in NCL’s responsibility determination, §e_e Calloway v.
Harvey, 590 F. Supp. 2d 29, 39 (D.D.C. 2008).

6) Declarations from NCL’s Former Vice President and President and Owner (Tabs 159
and 1601

The declarations from NCL’s employees, Steve Potter, NCL’s former Vice President for
Business Development, and Harned Wardak, NCL’s president and owner, describe the NCL

21

employees’ interviews in March, 2010, with an investigator for the House Subcommittee on
Homeland Security regarding NCL’s and its subcontractors’ relationships with Watan. Tab 159
at 21659-63, Tab 160 at 21664-67. These declarations were prepared in October, 2011, two
months after NCL’s nonresponsibility determination and were not before the contracting officer
when she conducted her responsibility review. The declarations detail NCL’s investigation of
rumors that its subcontractors were making payments to the Taliban and MTC’s relationship
with Watan. The proposed materials do not discredit or correct the contracting officer’s business
judgment that NCL had not substantiated that [ ].
Because these materials are not necessary for effective judicial review of NCL’s responsibility
determination, the Court denies supplementation with the declarations from NCL’s employees.

Plaintiff’ s Motion to Supplement the Court Record

Plaintiff also seeks to supplement the Court’s record with the decision of the Army’s
SDO terminating the referral for proposed debarment of GMT, another HNT contractor. GMT
was referred for proposed debarment based on allegations that GMT forged TMRs and submitted
false claims during performance of the HNT contract. On .lanuary 31, 2012, the SDO terminated
the proposed debarment of GMT, stating:

Army records and statements are insufficient to prove fraud. The statements provided
by the receiving unit representatives contain numerous inconsistencies and
contradictions; and thus, lack sufficient reliability and credibility. First, the statements,
individually or in combination, fail to support a finding that GMT more likely than not
committed f`raud. These statements merely indicate that there is no unit record available
to verify certain GMT TMRs. Hence, they fail to eliminate other plausible causes for
the lack of unit records, including misplaced or lost records, or fuel missions re-directed
to other locations. . . . Second, the statements are inconsistent and contradicted by other
evidence . . . .

Pl.’s Mot. to Supplement the Court R. Ex. 1 at 8-9.22 The SDO detailed statements by Army
representatives that were either inconsistent with or contradicted by TMRs produced by GMT
indicating that Army personnel had actually signed the TMR in question. icL at 9-10. The SDO
further concluded "[i]n the present case, there is a lack of direct or circumstantial evidence
showing that . . . GMT, its owner, or its employees falsified any TMRs with the intent to defraud
the U.S. govemment." I_d; at 10.

Plaintiff claims that the SDO’s decision should be added to the Court’s record because
the SDO’s findings confirm a pattern of Army attempts to blacklist or otherwise exclude HNT
prime contractors, the absence of any motive of HNT contractors to submit forged mission
sheets, and the inconsistency and unreliability of Army records. Plaintiff’ s argument fails
because the SDO’s termination of GMT’s referral for proposed debarment is immaterial to this
protest. Debarment proceedings are individualized assessments, tailored to the unique

22 Attachment 1 to Plaintiff’ s motion to supplement the Court’s record includes separately
paginated documents. The Court adopts the pagination generated by the CM/ECF filing system
for citation purposes.

22

circumstances of each contractor. GMT was referred for proposed debarment based on allegedly
forged TMRs submitted to the Army to obtain payment for fuel deliveries that GMT never
completed. To rebut the allegations in the referral, GMT submitted documentation to the SDO,
including actual TMRs and ITV records. Based on this particularized evidence, the SDO
determined that there was insufficient evidence of fraud to warrant GMT’s debarrnent. The SDO
also concluded that in certain cases, there was no record to verify GMT’s TMRs because the
Army had misplaced or lost records or re-directed fuel missions to other locations. The SDO’s
findings in GMT’s case based on GMT’s evidence and some lost records are not probative of
allegations that a different contractor, NCL, forged TMRs As such, the Court denies NCL’s
motion to supplement the court record with the Army SDO’s decision terminating GMT’s
proposed debarment.

The Parties’ Motions for Judgment on the Administrative Record
The Armv’s Responsibilitv Determination Was Reasonable

NCL alleges that the contracting officer’s responsibility determination was unreasonable
in several respects. NCL claims that the contracting officer’s reliance on NCL’s vendor vetting
assessment was unreasonable because [ ] reporting was outdated and inaccurate, the vendor
vetting program resulted in NCL’s <_:l§ fl debarment without affording it due process, and the
Army failed to notify NCL of its vendor vetting rejected status, as required by the vendor vetting
regulations. NCL further claims that NCL’s performance concems individually and in the
aggregate were insufficient to deem NCL nonresponsible, and that it satisfactorily answered and
addressed every cure notice and letter of concem cited by the contracting officer in the
nonresponsibility determination. NCL also alleges that its nonresponsibility determination was a
pretext for "blacklisting" the HNT contractors. Finally, NCL complains that the contracting
officer improperly found NCL to be nonresponsible by treating it an unequal and disparate
manner as compared to Anham, an HNT contractor that was deemed responsible. Although the
Court addresses each of the contentions in tum, at the outset the Court notes that, on the whole,
the evidence on which the contracting officer relied to find NCL nonresponsible was substantial
and compelling Under the FAR, when evaluating a prospective contractor for responsibility, a
contracting officer "Btll make a determination of nonresponsibility" if there is an "absence of
information clearly indicating that the prospective contractor is responsible." FAR 9.103(b)
(emphasis added). in this case, the record does not support a conclusion that NCL provided
"inforrnation clearly indicating" that NCL was responsible.

The Contracting Officer Reasonablv Relied On NCL Holdings’ Vendor Vetting
Rating

NCL contends that the contracting officer’s reliance on its [ ] vendor vetting
rating -- which rendered NCL ineligible for award -- was irrational because [ ] conclusions
were inaccurate. In NCL’s nonresponsibility deterrnination, the contracting officer cited [ ]
findings that NCL Holdings, LLC was [

]. Specifically, the
contracting officer stated:

23

A review of the supporting [ ] report for NCL indicates [

] This is supported by
the [ ] report dated 29 June 201 1. [

] further substantiates NCL’s inability to maintain integrity and business ethics
while performing transportation services in the Afghanistan area of operation; an area
rife with bribery, corruption, and criminal activity.

NCL 8-9.

NCL has failed to demonstrate that the contracting officer’s reliance on [ ] vendor
vetting assessment was irrational. As an initial matter, the contracting officer not only was
entitled to rely upon [ ] report and rating in her nonresponsibility evaluation, she was
required to do so. § REF 75-76, 231. The FRAGO requires that contracting officers consult
[ ] vendor vetting assessment, stating: "When a "rejected" vendor has submitted a proposal
and under the evaluation criteria a rejected vendor would be the apparent awardee of the
contract, the contracting officer must skip the rejected vendor and award the contract to the next
responsible and vetted vendor." REF 233. [

] REF 224. A [ ] is not a matter to be taken lightly. The classification of

a vendor as "HIGH" or "EXTREMELY HIGH" risk requires a "Validation Panel" to determine
whether the vendor should be "approved" or "rejected" within three days "by considering the

[ ] assessment and other relevant information." REF 231. Here, the agency’s rating for
NCL was based on a three-tiered process -- the initial [ . ] assessment, the
Validation Panel’s consideration and confirmation of that assessment, and the agency’s refusal to
waive the "rej ected" contractor’s ineligibility.

As the Comptroller General has recognized, information in investigative reports may be
used as the basis of a nonresponsibility deterrnination. S_ee Frar1k Cain & Sons, lnc., B-236893,
1990 WL 277550, at *2 (Comp. Gen. Jan. ll, 1990) (noting that a contracting officer was not
required to conduct an independent investigation of a criminal investigative report before using it

24

in a nonresponsibility determination); <_:L Guardian Moving & Storage Co., lnc. v. United States,
31 Fed. Cl. 645, 648-49 (1994) (upholding contracting officer’s reliance on assurances from the
interstate Commerce Commission regarding a licensing issue). Nonetheless, NCL seeks to
overtum its nonresponsibility determination on the grounds that [ ] conclusions were
inaccurate and based on outdated [ _ ]. Specifically, NCL contends that [ ]
conclusions were based on data from 2009, that was obsolete when [ ] prepared its report for
NCL Holdings, LLC in July, 2011, [ ] assessment was based upon [

1

Contrary to Plaintiff’s assertions, it was not arbitrary and capricious for the contracting
officer to rely upon [ ] reports that were two years old in her responsibility
determination, § MCi Constructors inc., B-240655, 1990 WL 293560, at *2-3 (Comp. Gen.
Nov. 27, 1990) (affirrning contracting officer’s reliance in nonresponsibility determination upon
company’s termination for default two years previously, especially where the contracting officer
also considered more recent performance); Reel-0-Matic Svs.. lnc. v. United States, 16 Cl. Ct.
93, 100-101 (1989) (upholding Small Business Administration’s refusal to issue certificate of
competency after considering adverse past performance on prior contract occurring roughly five
years prior to the decision, among other factors); §§ CRAssociates, lnc. v. United States, 95 Fed.
Cl. 357, 386-87 (2010) (noting that Govemment could not relieve bidder of solicitation’s
requirement of providing past performance data going back three years).

 

in any event, NCL has failed to show that the [ ] assessment on which the
contracting officer relied was inaccurate. indeed, NCL has failed to acknowledge instances
where it has not attempted to refute the [ ] assessment. For example, while NCL argued

[

] -- it did not dispute that [
]. Pl.’s Classified Annex to Mot.
for .l. on the Admin. R. 15-16.

The Vendor Vetting Procedure Did Not Deprive NCL of Due Process

Plaintiff further contends that the contracting officer improperly relied upon NCL’s
vendor vetting rating because that rating resulted from an illegal process. NCL alleges that the
vendor vetting program does not comport with due process because a "rejected" contractor like
NCL is prohibited from receiving any contract awards without notice of, or an opportunity to
respond to, its "rejected" status in a similar vein, Plaintiff contends that the vendor vetting
process fails to provide the procedural safeguards in FAR Subpart 9.4 goveming the debarment,
suspension, and ineligibility of contractors. Specifically, NCL claims that the vendor vetting
program resulted in its d_e facing debarment because it rendered NCL ineligible not only for the
NAT procurement but for all Department of Defense ("DoD") contracts in Afghanistan, NCL’s
primary source of business, for up to one year.

25

These allegations raise an issue about the extent of this Court’s authority to entertain and
remedy Plaintiff" s claim of § facto debarment. Under 28 U.S.C. § 1491(b)(1), this Court has
bid protest 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) (2006). in Distributed
Solutions, lnc. v. United States, the Federal Circuit broadly defined the phrase "in connection
with a procurement or proposed procurement," stating that it "involves a connection with any
stage of the federal contracting acquisition process . , . ."’ 539 F.3d 1340, 1346 (Fed. Cir. 2008).
Where a claim of § facto debarment is raised as a ground of protest (and not as an isolated claim
to nullify the debarment), this Court may consider allegations of § f§to debarment in
exercising its bid protest jurisdiction. _S§ TLT Const. Corp. v. United States, 50 Fed. Cl. 212,
215 -16 (2001) (exercising jurisdiction in post-award bid protest over plaintiffs claim that failure
to pursue discussions with plaintiff concerning its past performance constituted § fagg
debarment); CRC Marine Servs, lnc. v. United States, 41 Fed. Cl. 66, 68 (1998).

Here, because NCL’s vendor vetting rating was a basis for NCL’s responsibility
evaluation, which was conducted in the challenged NAT procurement, a constitutional challenge
to that vetting process predicated on a denial of due process is fair ga1ne. This is analogous to
the Court’s review of a corrective action an agency takes pursuant to a Govemment
Accountability Office ("GAO") recommendation following a successful GAO protest. While
this Court lacks jurisdiction to review a GAO decision outright, it may assess whether the GAO
decision was rational in order to determine whether the procurement action being challenged --
the agency’s corrective action predicated on that GAO decision -- was reasonable. §
Honevwell, lnc. v. United States, 870 F.2d 644, 647-48 (Fed. Cir. 1989) (stating that in deciding
whether an agency justifiably followed GAO’s recommendation, the controlling inquiry is
whether GAO’s decision was rational and cautioning against de novo review of the basis for
GAO’s determination); Centech Grp., lnc. v. United States, 78 Fed. Cl. 496, 507 (2007)
(determining that "to the extent that the agency relied upon GAO’s decision as a basis for taking
corrective action, GAO’s decision is pivotal for the Court’s review of the agency’s procurement
decision."); Advance Constr. Servs., lnc. v. United States, 51 Fed. Cl. 362, 365 (2002)
(reaffirming "the well-settled principle that ‘it is the agency’s decision, not the decision of the
GAO, that is the subject of judicial review’ when a bid protestor protests an award previously
reviewed by the GAO.") (quoting Chas H. Tompkins Co. v. United States, 42 Fed. Cl. 716, 719
(1999)). Here too, while [ ] determinations would not generally be reviewable in this
forum, this Court may consider [ ] vendor vetting rating process to the extent the resultant
vendor vetting rating was a basis for the contracting officer’s nonresponsibility determination.B

Plaintiff argues that the contracting officer acted arbitrarily and capriciously in relying on
[ ] vendor vetting assessment because [ ] vendor vetting rating constituted a § f§
debarment and deprived NCL of due process. Specifically, NCL complains that the vendor
vetting process "left [NCL] in the dark with no opportunity to learn or confront the allegations
against it, no opportunity to provide supplemental information normally used to mitigate or

23 Similarly, Plaintiff has standing to challenge its [ ] vendor vetting rating insofar as
that rating was a basis for its nonresponsibility determination in this procurement.

26

lessen the gravity of an offense, and no opportunity to seek reconsideration of the Vetting
Program’s conclusion." Pl.’s Classified Annex to Reply-Response 1-2.

A disappointed bidder alleging § §§ debarment must show evidence demonstrating
that the agency will not award the contractor future contracts. § TLT Const. Co@., 50 Fed. Cl.
at 215-16 (recognizing that Plaintiff must demonstrate a "‘systematic effort by the procuring
agency to reject all of the bidder’s contract bids"’) (quoting Stapp Towing lnc. v. United States,
34 Fed. Cl. 300, 312 (1995)). in the seminal case of'Old Dominion Dairv Products lnc. v.
Secretz;ry of Defense, the D.C. Circuit found that where the agency denied a contractor two
substantial contracts based on the determination that plaintiff lacked integrity and "effectively
put [plaintiff] out of business," the contractor was entitled to notice of the charges so as to afford
the contractor the opportunity to respond. 631 F.2d 953, 963-68 (D.C. Cir. 1980); § Leslie &
Elliot Co., lnc. v. Garrett, 732 F. Supp. 191, 198 (D.D.C. 1990).

Because NCL’s ineligible rating resulting from the vendor vetting process effectively
deprived NCL of fixture DoD contract awards in Afghanistan for up to one year, its vendor
vetting rating operates as a § f§ debarment. Where, as here, the Govemment effectively bars
a contractor from receiving contract awards and threatens the contractor’s livelihood, the
Govemment infringes upon the contractor’s constitutionally protected liberty interest. §§ Ql_c_l
Dominion, 631 F.2d at 966-67 (holding that the Government’s denial of contract awards that
resulted in foreclosure of government employment opportunities for a contractor implicates a
liberty interest recognized by the Fifth Amendment); see also Trifax Corp. v. District of
Columbia, 314 F.3d 641, 644 (D.C. Cir. 2003) (stating that Govemment stigmatization that
broadly precludes individuals or corporations from a chosen trade or business deprives them of a
constitutionally protected liberty interest). in these circumstances, the deprivation of a
contractor’s protected liberty interest triggers procedural due process rights under the Fifth
Amendment. Old Dominion, 631 F.2d at 966.

Due process normally requires that a contractor receive notice of the charges impugning
its integrity and an opportunity to be heard. §§ Old Dominion, 631 F.2d at 968; Leslie & Elliot
Co. inc., 732 F. Supp at 198. However, the requirements of due process vary given the
circumstances §§ Morrissey v. Brewer, 408 U.S. 471, 481 (1972) ("[D]ue process is flexible
and calls for such procedural protections as the particular situation demands."). Although the
vendor vetting rating process does not provide a contractor either notice of its ineligible status or
an opportunity to present rebuttal evidence, requiring traditional due process in the [ ] rating
process would adversely affect national security. in the environment of a warzone when the
required notice would necessarily disclose classified material and could compromise national
security, normal due process requirements must give way to national security concems. Not only
would affording due process here require disclosure of classified information and endanger
military intelligence sources it would provide information to entities that pose a potential threat
to the United States, thereby placing United States forces and operations at risk.

The Tucker Act’s jurisdictional grant specifically instructs this Court to give due
consideration to national security interests in exercising its bid protest jurisdiction. § 28
U.S.C. § 1491(b)(3) (2006) ("in exercising jurisdiction under this subsection, the courts shall
give due regard to the interests of national defense and national security . . . ."). As the D.C.

27

Circuit recognized, basic elements of due process such as "notice, grounds, opportunity to
respond and be hear " are subject to "essential national security considerations." Gonzalez v.
Freeman, 334 F.2d 570, 580 n.21 (D.C. Cir. 1964); c_f`. Snep_p v. United States, 444 U.S. 507, 509
n.3 (1980) ("The Government has a compelling interest in protecting both the secrecy of
information important to our national security and the appearance of confidentiality so essential
to the effective operation of our foreign intelligence service."); l\/iartin v Lauer, 686 F.2d 24, 34
(D.C. Cir. 1982) (recognizing that the government’s interest in nondisclosure in the Freedom of
information Act context is "perhaps greatest when govemment information concems national
secrets").

Here, the interests of national security preclude the Govemment from divulging classified
military intelligence to entities regarded as potential threats to United States military forces §
Makky v. Chertoff`, 541 F.3d 205, 217-18 (3d Cir. 2008) (discharged employee of Transportation
Security Administration was not entitled to notice of classified allegations leading to his
terrnination, because agency was prohibited by law from releasing the information); see also 18
U.S.C. § 798 (2006) (criminalizing unlawful release of classified information); Exec. Order No.
13256, 75 Fed. Reg. 707, 726 (Dec. 29, 2009) ("Officers and employees of the United States
Govemment, and its contractors . . . shall be subject to appropriate sanctions if they knowingly,
willfully, or negligently: (1) disclose to unauthorized persons [classified] information . . . .").

The statutory mandate in 28 U.S.C. § 1491(b)(3) that this Court give due regard to the
interests of national defense and national security coupled with precedent indicating that national
security concems trump due process rights dictate a ruling that [ ] was not required to provide
any additional procedural safeguards to NCL as part of the vendor vetting process. § Cafeteria
& Rest. Workers Union, Local 473 v. McElrov, 367 U.S. 886, 896 (1961) (holding that no
hearing was required where Navy revoked employee’s security clearance because the
governmental function at issue was "to manage the intemal operation of an important federal
military establishment.") (citations omitted).

in sum, although NCL’s vendor vetting rating process precluded NCL from being eligible
for DoD contracts in Afghanistan for up to one year, given national security interests, NCL was
not entitled to receive formal notice of, or an opportunity to respond to, its vendor vetting rating.
As such, the contracting officer reasonably relied on [ ] assessment in NCL’s responsibility
evaluation.

The Army Was Not Required to Notifv NCL of its Reiection Under the Vendor
Vetting Procedures

NCL alleges that the Army failed to follow the vendor vetting procedures when it did not
notify NCL during its August 10, 2011 debriefing that it had been "rejected" and failed to advise
NCL of its right to reconsideration. NCL’s argument hinges on its contention that it should have
been deemed an "apparent successfi,ll offeror" within the meaning of the Acquisition instruction
at the time of its August 10, 2011 debriefing. The Acquisition instruction requires:

if, and only if, the rejected apparent successful offeror requests a debriefing, inform
them of the following, in writing, after coordinating with CJA:

28

"You were determined to be ineligible for award of subject contract by United States
Forces - Afghanistan/Iraq. You may submit a written request for reconsideration of this
determination to USFOR-A/USF-i, through the Contracting Officer, within 60 calendar
days of this notification."

REF 76 (emphasis added). Otherwise, upon confirmation that a vendor is rejected, the
contracting officer "shall bypass the rejected offeror and consider the next best offeror in the
competitive range for award." i§d. The Acquisition instruction states that "[i]f an offeror is not
the apparent successful offeror, follow normal procedures DO NOT MENTION THEIR
INELIGIBILITY[.]" i§d.

On August 10, 2011, the date on which Plaintiff claims it should have been informed of
its [ ] "rejected" status at its debriefing, NCL was not an "apparent successfiil offeror." The
label of apparent successful offeror typically applies to an offeror that has satisfied all
requirements for award at a given point in time. Here, the contracting officer had already
notified NCL prior to August 10, 2011, of "adverse information" concerning NCL’s past
perforrnance, including forgery, fraud, failure to comply with ITV requirements, and
noncompliance with HNT contract requirements By letter dated July 30, 2011 (revised on
August 1, 2011), the contracting officer notified NCL that it was being evaluated for
responsibility and listed areas of concem relating to NCL’s performance, characterizing these
concems as "adverse information which may impact the responsibility deterrnination." AR
16239-41, 16249-51. importantly, when it requested a debriefing on August 10, 2011, Plaintiff
was already aware that it had been deemed nonresponsible and rejected from the NAT
procurement. NCL received notification of the Army’s nonresponsibility determination on
August 9, 2011, § AR 16367-70, 16373-74. Because NCL was not an "apparent successful
offeror" on August 10, 2011 when it received its written debriefing, the contracting officer was
under no obligation to notify NCL in its written debriefing that it had an opportunity to request
reconsideration of its [ ] vendor vetting rating.

in this Court’s view, the classified record and NCL’s ineligibility due to its vendor
vetting rating provides ample support for the contracting officer’s determination that NCL was
nonresponsible. Nonetheless, the Court addresses NCL’s additional challenges to the
nonresponsibility deterrnination. -

The Contracting Officer Reasonablv Considered NCL’s Unsatisfactorv ITV

NCL also had an unsatisfactory record of ITV use -- the requirement that carriers install
satellite-based tracking devices on cargo trucks -- that raised serious doubts as to its reliability to
perform in a warzone. The HNT statement of work required that "[a]ll vehicles used in support
of HNT missions must have [an ITV] device . . . ." AR 21259. Despite this requirement, NCL’s
average rate of ITV use for one four-week period was only 19%, according to a December 22,
2009 letter of concem, AR 21434-35. in its response to this letter of concern, NCL did not
dispute its low ITV utilization rate and outlined a corrective action plan. _S§ AR 16268-69.
However, NCL’s corrective action failed to remedy its low ITV use rates, as evidenced by a cure

29

notice issued on March 12, 2010, §§ AR 21501. The cure notice stated that between February
12, 2010, and March 6, 2010, NCL’s utilization rate fluctuated between 24.94% and 39.51%. §
NCL again conceded that its performance in this regard was unsatisfactory, responding that
"NCL’s recent performance as it relates to GDl\/IS performance has dropped significantly, and,
as you acknowledge, is not acceptable to you, nor is it acceptable to NCL." AR 16272.

NCL contends that its ITV use improved significantly and that its average ITV use was
93.26% during the 16-month period from April 2010 to July 2011, but NCL’s improved
performance does not alter its earlier failure to comply with the HNT contract’s i'l`V
requirements AR 16260-61.

The Contracting Off`icer Reasonablv Considered NCL’s Forged Mission
Sheets and Pilferage

The contracting officer also determined that NCL was nonresponsible based on a
December 22, 2009 letter of concern regarding forged mission sheets, pilferage, and non-
compliance with ITV requirements NCL 6-7. Although NCL contends there is no support for
agency allegations of forgery, in its December 29, 2009 response, NCL did not deny that it had
committed forgeries and blamed the Government for requiring contractors to use hardcopy
mission sheets, stating "[t]he use of hardcopy mission sheets in this environment is subject to
considerable risk of loss of such sheets, forgery, as you note in the [letter of concem] and even
holding hostage of such sheets on the mistaken belief that they allowed leverage to get paid."
AR 16268.

The Army’s letter also identified three failed cargo missions with losses totaling
$50,648.20 and eight failed fuel missions. § AR 21434. in its response, NCL did not deny
ther pilreidge had occurred er ther it had failed eight fuel missiehs?" se_e AR 16269-70. while
NCL argues that these problems were "de minimis" in light of NCL’s entire record of
performance on the HNT contract, the contracting officer’s contrary business judgment was
reasonable.

Transponder Stacking and NCL’s Referral for Proposed Debarment

The contracting officer also found NCL nonresponsible because NCL’s subcontractor
engaged in transponder stacking. On October 18, 2010, the Army confiscated 17 NCL mission
sheets and 17 transponders from one vehicle driven by an employee of NCL’s subcontractor, the
Times Group. AR 16277. Of the 17 transponders confiscated, six registered a required load date
of October 17, 2010, and pinged on this date, indicating that their assigned trucks were "awaiting
upload at origin." i_c_l_. Because the six transponders were located in one vehicle, however, their
corresponding trucks were, in fact, not awaiting upload at origin -- there were no additional
trucks. The Army also found that 10 of the remaining 11 transponders confiscated had been

24 Subsequently, NCL contested its liability for failed fuel missions before the ASBCA,
but in its response to the Army’s letter of concern, NCL did not deny that it had failed the eight
fuel missions identified by the contracting officer.

30

assigned to one HNT mission sheet found in the same vehicle. l§d. On October 19, 2010, the
Army notified NCL of this incident in a letter of concem, and NCL admitted in a letter dated
October 23, 2010, that it had engaged in transponder stacking. AR 1627 7, 16274.

NCL argues that the contracting officer’s reliance on transponder stacking as a basis for
NCL’s nonresponsibility determination was irrational because NCL subsequently terminated the
subcontractor that was responsible and retrained its employees. AR 16275. Nonetheless, NCL
partnered with the subcontractor it claims was responsible for engaging in transponder stacking
again in its proposal for the NAT contract. S_e§ AR 4632-33. in any event, the contracting
officer’s decision to deem NCL nonresponsible based on even one instance of fraudulent conduct
was reasonable. This type of assessment is a quintessential business judgment, and this Court
will not second-guess the contracting officer’s judgment where there is supporting evidence.z$
§ Bender Shipbuilding, 297 F.3d at 1362; Ettefaq-Meliat-Hai-Afghan Consulting lnc. v.
United States, 106 Fed Cl. 429, 436-37 (20l2); News Printing Co., 46 Fed. Cl. at 746.

Withheld Payments

The contracting officer also concluded that NCL was nonresponsible because the Army
withheld $22,286,118.28 from NCL under the HNT contract, "for a combination of failed
missions, Cancelled No Pay Missions, Pilferage/Backcharges and Fuel Backcharges," of which
$5,272,125.20, was attributable to "NCL’s performance failures." NCL 8. NCL contends that it
is not liable for $5,272,125.20 because the Govemment reduced NCL’s withholding based on 61
allegedly failed fuel missions by $863,547.31 in a contracting officer’s revised final decision
dated August 10, 2011, § AR 215 57. However, the Arrny also withheld payments for NCL’s
other performance shortcomings, including cancelled no-pay missions and
pilferage/backcharges. Even if NCL’s withholding of $5,272,125.20 were reduced by
$863,547.31, these withheld payments were substantial and, considered with NCL’s overall HNT
performance, provided a reasonable ground for the contracting officer’s nonresponsibility
lihdihg?€

25 NCL’s transponder stacking led to its referral for debarment, another development the
contracting officer relied on in her nonresponsibility deterrnination. According to the
responsibility determination, NCL was referred for proposed debarment based on "numerous acts
of criminal misconduct such as transponder stacking . . . ." NCL 8. However, the referral for
proposed debarment was based on NCL’s single admitted incident of transponder stacking. The
Govemment has conceded that the contracting officer’s finding in the nonresponsibility
determination that NCL engaged in reoccurring instances of transponder stacking was an error.
Def’s Cross Mot. for J. on the Admin. R. 20. NCL has not shown that the contracting officer’s
erroneous reliance on "reoccurring" instances of transponder stacking tainted the remainder of its
nonresponsibility determination or that, absent this error, it should have been found responsible.

26 The contracting officer also found that NCL lacked a satisfactory performance record
because its use of "NWTC as a subcontractor under NCL’s HNT contract resulted in . . . negative
feedback from the customer, specifically relative to the subcontractor’s ability to meet
contractual requirements and timelines." NCL 6. The Govemment has conceded that the
contracting officer’s reference to problems with NWTC in NCL’s responsibility evaluation was
(footnote continued on next page)

31

The Contracting Off`icer Reasonablv Concluded that NCL Failed to Complv
with PSC Arming Requirements

The contracting officer also concluded that NCL was nonresponsible based on NCL’s
noncompliance with PSC arming requirements as detailed in a cure notice dated January l,
2010, and two letters of concem dated February 1, 2010, and June 24, 2010. NCL 4, 5. in
response to the June 24, 2010 letter of concem,.NCL stated it was in the process of complying
with this contractual requirement. Although the Army had by this time authorized NCL to
submit arming infor1nation, NCL had yet_to enter all the required information into the Army’s
tracking system, and NCL indicated it would not be fully compliant with all the PSC arming
requirements until August 31, 2010. § AR 16336. While this deficiency standing alone might
not suffice to render a contractor nonresponsible, in the overall context here NCL’s failure to
comply with PSC arming requirements, spanning eight months supports the contracting officer’s
conclusion that NCL "lack[ed] . . . commitment and responsibility to properly administer and
perform in accordance with the contract requirements without significant involvement from the
U.S. Govemmen ." NCL 5.

The Contracting Off`icer Reasonablv Considered NCL’s Corrective Action

NCL argues that it satisfactorily addressed the Army’s concems with its HNT
performance, but the NAT contracting officer did not credit NCL’s corrective actions. However,
the contracting officer reasonably concluded that NCL’s documented record of nonperformance
outweighed its corrective action after considering the barrage of cure notices and letters of
concem detailed in the nonresponsibility determination and NCL’s responses and corrective
action. Although NCL attempted to improve its performance and did implement some corrective
action, the record clearly establishes that NCL had significant lapses in its required performance
under the HNT contract. Where a contractor’s performance has been unsatisfactory, its
implementation of some degree of corrective action does not preclude an agency from finding
that contractor nonresponsible. C_f. Stapp 'l`owing lnc. v. United States, 34 Fed. Cl. 300, 309-10
(1995) (upholding Small Business Administration’s refusal to issue a certificate of competency
to contractor with an unsatisfactory safety record, despite contractor’s ongoing corrective
action); Reel-O-Matic Svs., inc., 16 Cl. Ct. at 98-101 (upholding Small Business
Administration’s refusal to issue a certificate of competency to contractor based in part on
contractor’s "unsatisfactory performance record in the past on the same type of contract," despite
contractor’s attempts to increase capacity and hire new technical qualified personnel).

Plaintiff argues that its nonresponsibility determination in the NAT procurement was
irrational because the Army considered NCL sufficiently responsible to continue performing the

an error. Def.’s Cross-Mot. for J. on the Admin. R. 28-29. The negative feedback from the
customer actually pertained to NWTC’s contract with Fernridge Strategy Partners ("Ferrlridge").
NCL 70-73. Because the contracting officer rationally found NCL to be nonresponsible for
several other reasons however, her erroneous reliance on NWTC’s performance record with
Fernridge is not a sufficient basis to overtum her deterrnination.

32

HNT contract. The fact that the Army continued to use NCL Holdings, LLC for the HNT
contract -- an emergency wartime contract -- did not hamstring its ability to make a different
business judgment when evaluating NCL’s responsibility for a Second, independent award. §§
MCI Constructors Inc., 1990 WL 293560, at *3 ("A nonresponsibility determination may be
based upon the contracting agency’s reasonable perception of inadequate prior perforrnance,
even where the agency did not terminate the prior contract for default . . . .").

 

NCL Has Not Shown That the Army Adopteli a Politicallv Motivated Blacklist Precluding
NCL from Receiving a NAT Award `

NCL claims that it was arbitrarily excluded from the NAT competition because the Army
adopted an improper "blacklist" excluding all HNT incumbent contractors Plaintiff contends
that the Army’s blanket exclusion of all HNT contractors but not HNT subcontractors based on
their nonresponsibility evaluations was contrary to the FAR and the solicitation. NCL further
contends that the Army’s nonresponsibility determinations for the HNT incumbent contractors
were pretexts for the Army’s politically motivated blacklisting of these contractors

Although Plaintiff denies that it is alleging bad faith, the substance of NCL’s argument is
that the Army’s responsibility determinations were pretextual and manufactured to exclude the
HNT contractors from the NAT procurement. Such an allegation is a quintessential accusation
of bad faith because it claims that the entirety of all HNT contractors’ nonresponsibility
determinations were unfounded fabrications. See Madison Servs., lnc. v. United States, 92 Fed.
Cl. 120, 130 (2010) (rejecting plaintiff" s argument that "bad faith is ‘not essential to establish
that a cancellation was a pretext"’ as an "untenable" argument). Accordingly, the Court
construes Plaintiff s pretext argument as an allegation that NCL’s responsibility evaluation was
conducted in bad faith.

A bidder alleging bad faith bears a heavy burden of proof to establish its claim with clear
and convincing evidence, § Am-Pro Protective Agencv, lnc. v. United States, 281 F.3d 1234,
1241 (Fed. Cir. 2002) (requiring disappointed bidder to make a showing of clear and convincing
evidence to support claim that agency did not act in good faith). As the Federal Circuit has
recognized,

[W]hen a bidder alleges bad faith, "[i]n order to overcome the presumption of good
faith [on behalf of the govemment], the proof must be almost irrefragable." info. Tech.
Applications Corp. v. United States, 316 F.3d 1312, 1323 n. 2 (Fed. Cir. 2003).
“Almost irrefragable proof" amounts to "clear and convincing evidence." Am-Pro
Protective Agencv, lnc. v. United States, 281 F.3d 1234, 1239-40 (Fed. Cir. 2002). "in
the cases where the court has considered allegations of bad faith, the necessary
‘irrefragable proof’ has been equated with evidence of some specific intent to injure the
plaintiff." Torncello v. United States, 231 Ct. Cl. 20, 681 F.2d 756, 770 (1982).

Galen Med. Assocs, lnc. v. United States, 369 F.3d 1324, 1330 (Fed. Cir. 2004).

NCL alleges that the Army was apparently under pressure from Congress to exclude
HNT incumbent contractors from the NAT procurement. Plaintiff notes that Congress initiated

33

an investigation of the Army’s transportation arrangements in Afghanistan following media
reports alleging that HNT contractors made payments to the Taliban and Afghan warlords to
ensure safe passage for their trucking convoys.~ Subsequently, in June 2010, Congress published
a report alleging "that U.S. reconstruction dollars were finding their way into the hands of
Afghan warlords and the Taliban." Pl.’s Mot. for J. on the Admin. R. 20-21.27 NCL claims that
this Congressional report prompted the Army to unlawfully exclude all incumbent HNT
contractors from the NAT procurement in order to appease Congress. i§d. at 21.

Plaintiff" s claim that the Congressional report caused the Army to implement a blacklist
excluding all HNT contractors from the NAT procurement is conjecture, wholly devoid of record
support, and does not come close to making a showing of clear and convincing evidence required
to prove bad faith.

The performance concerns identified by the contracting officer in NCL’s responsibility
determination were not, as Plaintiff contends "relatively minor matters of contract
administration . . . ." Pl.’s Mot. for J. on the Admin. R. 21. Plaintiff" s [

] noncompliance with ITV standards forged
mission sheets pilferage, incident of transponder stacking, referral for proposed debarment,
withheld payments due to nonperformance, and failure to timely provide required deliverables
taken together reflect serious shortcomings The contracting officer’s reliance on NCL’s
documented HNT performance failures was a reasonable business judgment, and the fact that
Congress was critical of all HNT contractors’ practices does not demonstrate the contracting
officer’s bad faith toward NCL. Nor does the existence of this report prove that the contracting
officer failed to exercise her independent judgment in NCL’s responsibility assessment.

NCL also contends that the Army’s disparate treatment of the HNT prime contractors as
compared to the HNT subcontractors is evidence that the Army blacklisted these HNT
contractors or applied a per se debarment standard to them. Specifically, Plaintiff contends that
the Army systematically rejected all of the HNT prime contractors after subjecting them to a
more rigorous responsibility evaluation than the HNT subcontractors However, the Army’s
exclusion of other HNT offerors from the NAT procurement based upon their individualized
nonresponsibility determinations is not probative evidence that NCL’s responsibility evaluation
was unreasonable. Plaintiff’s effort to impugn a contracting officer’s individual responsibility
determinations of the other HNT prime contractors not only requires Plaintiff to marshal
substantial additional proof but would, if seriously pursued, significantly have expanded the
record and scope of NCL’s bid protest. Although the responsibility determinations for the NAT
awardees are in the AR, the nonresponsibility determinations for six former HNT prime
contractors are not, and Plaintiff did not seek to add them. §§ AR 1793 8-1 8266. As such, there
is no factual predicate to conduct the disparate treatment analysis Plaintiff urges the Court to

27 The Congressional report Plaintiff cites is not in the AR, and Plaintiff did not seek to
supplement the AR with this report. in Plaintiff’ s Motion for Judgment on the Administrative
Record, Plaintiff included a footnote containing a URL of a website that posted the
Congressional report. §§ Pl.’s Mot. for J. on the Admin. R. 21 n.7. Defendant does not object

l to Plaintiff’ s referring to the Congressional report in this marmer.

34

undertake. Plaintiff has failed to demonstrate that the contracting officer implemented a
"blacklist" or unfairly excluded all HNT contractors from the NAT competition.

Allegations of Disparate Treament

Plaintiff further alleges that the contracting officer improperly found NCL to be
nonresponsible by treating it in an unequal and disparate marmer as compared to Anham, LLC
("Arlhaln"), another HNT contractor that was deemed responsible. Specifically, NCL contends
that although NCL and Anham were similarly situated offerors with respect to their HNT
contract perfor1nance and [ ,` .]; the NAT contracting officers evaluated NCL and
Anharn differently with respect to responsibility.

As an initial matter, contracting officers are obligated to treat all offerors equally,
"evaluating proposals evenhandedly against common requirements and evaluation criteria."
Banknote Corp. of Am., lnc. v. United States, 56 Fed. Cl. 377, 383 (2003), §§ 365 F.3d 1345
(Fed. Cir. 2004); FAR 1.602-2(b) ("Contracting officers shall . . . [e]nsure that contractors
receive impartial, fair, and equitable treatment . . . ."). indeed, "an agency action is arbitrary
when the agency offered insufficient reasons for treating similar situations differently."
Transactive Corp. v. United States, 91 F.3d 232, 237 (D.C. Cir. 1996). This fundamental
principle of equal treatment is applicable in the context of a contracting officer’s responsibility
determination. Although responsibility determinations must be tailored to the unique situation of
a given offeror, a comparison of these two offerors’ responsibility determinations is feasible
because NCL and Anham performed the same HNT contract, which was predominantly used to
measure responsibility for the NAT procurement. The contracting officer’s final responsibility
determination for Anham acknowledges the comparative nature of the responsibility
determination: "By comparing Anham’s performance under the HNT contract with the other
HNT contractors all performance records can be seen in the same overall context -- all
contractors agreed to provide the same services in the same locations given the same conditions."
NCL 179.

Plaintiff alleges that the contracting officer’s review of NCL’s record in several areas of
performance on the HNT contract was arbitrary and capricious in light of Anham’s
determination of responsibility. Plaintiff has failed to prove, however, that NCL and Anham had
sufficiently similar HNT performance records.

At the outset, there is a major difference in NCL’s and Anham’s status as contractors in
Afghanistan. As a result of [ ] assessment, NCL was determined to be a
[

] NCL 165-66. As such, NCL
was determined to be ineligible for award. NCL 15 . Although, as explained above, NCL raised
numerous challenges to its ineligibility rating, it failed to demonstrate any basis to undermine
[ ] assessment. NCL’s instant effort to attack its [ ] rating based upon a comparison with
Anham’s rating fares no better. in essence, NCL asks the Court to second-guess the contractors’
vendor vetting ratings and substitute its judgment for that of [ ] and the Validation Panel and
conclude that the nature of Anham’s [ ] was [ ] "worse" than

35

NCL’s. Pl.’s Classified Annex to Mot. for J. on the Admin. R. 4. 'l`he record does not support

NCL’s contention. [ ] assessment [
] was an independent reasonable basis for [ ' ] rating of NCL Holdings as [

' ] in contrast, while Anham had
[ ] there wasino suggestion in Anham’s [ ] assessment
[ - . ._", '. ]. Moreover, as a
general matter, there is no basis for the Court to find either NCL’s ineligible rating or Anham’s
eligible rating unreasonable. These ratings were based on [ ]
in the field in Afghanistan that are closer to, and more knowledgeable about, the intricacies of
[ ] private security providers and contractors in the Afghanistan warzone.

§ islamic Am. Relief Agencv v. Gonzales 477 F.3d 728, 734 (D.C. Cir. 2007) (stating that
judicial review -- "in an area at the intersection of national security, foreign policy, and
administrative law -- is extremely deferential."); c_f`. Latif v. Obama, 666 F.3d 746, 750 (D.C. Cir.
2011) (noting that "courts have no special expertise in evaluating the nature and reliability of the
Executive branch’s wartime records").

Given that NCL and Anham were in a dramatically different posture with respect to their
threshold eligibility to perform the NAT contract, they were not similarly situated. As such,
NCL’s disparate treatment argument fails.zg

28 Nor was NCL’s HNT performance comparable to Anham’s in other areas Anham and
NCL were not similarly situated with respect to ITV use. Although the record does not contain
complete ITV utilization data for both contractors NCL’s rate of ITV use was three times worse
than that of Anham’s on December 22, 2009, and in March 2010, NCL received a cure notice,
specifying an ITV utilization rate ranging from 39.51% to 24.94 % in the four weeks prior.
Compare AR 23013-14 (indicating Anham’s ITV rate was 60%), § AR 21434-35 (indicating
NCL’s ITV rate was 19 percent), 21501. While NCL improved its average ITV utilization rate
to 93.26% in the 16 months following the cure notice, this improvement does not absolve NCL
of its initial failure to meet this contract requirement. Anham, by contrast, was deemed "a top
performer regarding this metric." AR 16260-61; NCL 177.

Similarly, the NAT contracting officer cited significantly more funds withheld for
performance failures from NCL, than from Anham, Compare NCL 8 ($5,272,125.20 withheld
from NCL), § NCL 179 ($1,392,499.64 withheld from Anham). Although a revised final
decision by the HNT contracting officer reduced NCL’s liability for withheld payments by
$863,547.31, the total amount of payments withheld from NCL exceeded payments withheld
from Anham, AR 21557.

Finally, NCL’s admitted incident of transponder stacking was more serious than Anharn’s
ITV data manipulation. Anham manipulated ITV data by randomly assigning transponder
numbers to trucks but this practice did not result in either credit for deliveries that were never
completed or in raising its standing on the Order-of-Merit list, the metric by which HNT
contractors were assigned missions. NCL 191, AR 16277.

36

NCL’s Overall Performance on the HNT iContract

The contracting officer reasonably determined that NCL’s performance on the HNT
contract as a whole exhibited serious deficiencies and a pattern of noncompliance which
combined to raise serious doubts about NCL’s ability to perform the NAT contract, citing NCL’s
[ ' ] failure to comply
with ITV standards forged mission sheets pilferage, incident of transponder stacking, withheld
payments for performance failures and failure to_timely provide required deliverables. These
findings were sufficient to justify the contracting officer’s conclusion that NCL was
nonresponsible. NCL’s arguments that it subsequently improved its nonperformance or that it
[ ] do not alter the evidence
that such misconduct occurred.

The FAR does not require that each of the contracting officer’s conclusions be
independently sufficient on its own to support a finding of nonresponsibility. Rather, the
contracting officer’s nonresponsibility determination as a whole must be rational. § Ettefag-
Meliat-Hai-Afghan Consulting inc, 106 Fed Cl. at 43 8-39; To the Sec’v of the Armv, B-151121,
1963 WL 2036, at *6 (Comp. Gen. Sept. 13, 1963). Even acknowledging those instances where
the contracting officer was inaccurate in her assessment of NCL’s nonperformance -- the
"reoccurring instances" of transponder stacking instead of a single incident, and negative
feedback conceming NWTC -- NCL’s cumulative failures provided a reasonable basis for the
contracting officer’s business judgment that NCL lacked the requisite business integrity, ethics

and perseverance to perform the NAT contract. E.g., To the Sec’v of the Armv, 1963 WL 2036,
at *6 (finding nonresponsibility determination reasonable because the cumulative effect of
deficiencies -- including minor deficiencies -- would "unduly . . . increase the burden of
administration from the Govemment’s standpoint.").

Conclusion

Plaintiff’s motions to supplement the AR are GRANTED in part.

Defendant’s Motion for Judgment on the Administrative Record is GRANTED.
Plaintiff’s Motion for judgment on the Administrative Record and Permanent injunction is
DENIED. The Clerk of Court is directed to enter judgment accordingly.

The parties and the classified information security officer shall propose redactions to this

opinion by February 7, 2013.

s/Mary Ellen Coster Williams
MARY ELLEN COSTER WILLIAMS
Judge

37