Court Opinion

ID: 8213998
Source: CourtListenerOpinion
Date Created: 2022-10-13 21:02:16.87237+00
Date Added: 2024-06-11T16:42:26.641262
License: Public Domain

In the United States Court of Federal Claims
                                        No. 22-543C
                           (Filed Under Seal: September 28, 2022)
                                (Reissued: October 13, 2022)
                                   FOR PUBLICATION
***************************************
ESIMPLICITY, INC.,                    *
                                      *
                  Plaintiff,          *
                                      *
v.                                    *
                                      *
THE UNITED STATES,                    *
                                      *
                  Defendant.          *
                                      *
***************************************
      Eric A. Valle, PilieroMazza PLLC, Washington, D.C., for Plaintiff. With him
on the briefs were Isaias “Cy” Alba, IV, Katherine B. Burrows, and Patrick T.
Rothwell, PilieroMazza PLLC, Washington, D.C.
      Jana Moses, Trial Attorney, Commercial Litigation Branch, Civil Division,
United States Department of Justice, Washington, D.C., for Defendant, United
States. With her on briefs were Brian M. Boynton, Principal Deputy Assistant
Attorney General, Patricia M. McCarthy, Director, Douglas K. Mickle, Assistant
Director, and Shantay N. Clarke, Senior Assistant Counsel, NAVSUP Fleet Logistics
Center Norfolk, Philadelphia, PA.
                                  OPINION AND ORDER
      Plaintiff eSimplicity, Inc. protests the government’s rejection of a proposal it
submitted in response to a solicitation. The government determined that the proposal
was untimely; eSimplicity contends that determination rests on legal error and the
application of an undisclosed evaluation criterion. The parties have filed cross-
motions for judgment on the administrative record, and I have heard oral argument.1
For the reasons discussed below, Plaintiff’s motion is GRANTED and Defendant’s


  Pursuant to the protective order in this case, the Court initially filed this opinion under seal on
September 28, 2022, for the parties to propose redactions of confidential or proprietary information.
The parties were directed to propose redactions by October 12, 2022. The parties notified the Court
that there were no proposed redactions. The Court hereby releases publicly the opinion and order of
September 28 in full.
1 Pl.’s Mot. for J. on the Administrative R. (ECF 25) (“Pl.’s MJAR”); Def.’s Cross-Mot. for J. on the

Administrative R. & Opp. (ECF 27) (“Def.’s MJAR”); Pl.’s Resp. & Reply (ECF 30) (“Pl.’s R&R”); Def.’s
Reply (ECF 31); Hearing Tr. (ECF 35) (“Tr.”).
motion is DENIED. The case is REMANDED for further proceedings. The
government is ENJOINED from certain action inconsistent with this Opinion.

                                   BACKGROUND
        Submitting a proposal in response to a government solicitation means
complying with strict deadlines. This Court sometimes calls that obligation the “‘late
is late’ rule.” See Insight Systems Corp. v. United States, 110 Fed. Cl. 564, 574 (2013).
Under the “late is late” rule, submissions received even moments after the deadline
are disqualified unless they meet certain limited exceptions:
      (2)(i) Any offer, modification, revision, or withdrawal of an offer received
      at the Government office designated in the solicitation after the exact
      time specified for receipt of offers is “late” and will not be considered
      unless it is received before award is made, the Contracting Officer
      determines that accepting the late offer would not unduly delay the
      acquisition; and—
      (A) If it was transmitted through an electronic commerce method
      authorized by the solicitation, it was received at the initial point of entry
      to the Government infrastructure not later than 5:00 p.m. one working
      day prior to the date specified for receipt of offers; or
      (B) There is acceptable evidence to establish that it was received at the
      Government installation designated for receipt of offers and was under
      the Government’s control prior to the time set for receipt of offers; or
      (C) If this solicitation is a request for proposals, it was the only proposal
      received.
See Federal Acquisition Regulations (“FAR”) 52.212-1(f)(2) (codified at 48 C.F.R.); see
also FAR 52.212-1(f)(4) (tolling deadlines during interruptions of government
processes); Insight Systems, 110 Fed. Cl. at 575 (exception for lateness caused by the
government). The first of those exceptions (FAR 52.212-1(f)(2)(i)(A)) is sometimes
called the “electronic commerce” exception. The second (FAR 52.212-1(f)(2)(i)(B)) is
sometimes called the “government control” exception.
       With the basic legal background in mind, the relevant facts are as follows.
Solicitation No. N0018922RZ011, issued by the Department of the Navy, requested
technical support for the Navy’s electromagnetic spectrum resources. Administrative
Record (“AR”) 109. The Solicitation required that proposals be submitted by e-mail
no later than April 25, 2022, at 5:00 p.m. EST. AR 99, 124. The Solicitation included
instructions for proposal formatting — e.g., division of proposals into volumes, one of
which was subject to a 30-page limit — but did not mention a maximum file size. AR
126.

                                          -2-
       eSimplicity e-mailed its proposal before the deadline on April 25, and its e-mail
application confirmed delivery to the government server. AR 148. A screenshot of the
submission shows that the e-mail included three files totaling approximately 23 MB.
AR 158; see also Compl. Exh. A, Attachment 1 (ECF 1-1). But eSimplicity never
received either a confirmation of receipt or a delivery failure notification. When
eSimplicity inquired about the proposal’s status, it turned out that the proposal had
not arrived in the recipient’s e-mail account.
       The Defense Information Systems Agency (“DISA”) performed a forensic
investigation. The investigation revealed that eSimplicity’s proposal had been
received by a DISA-managed server and queued for delivery, but that it had been
“bounced back by the destination server because it exceeded the maximum file size.”
AR 165. The record is ambiguous as to whether the DISA server contains a copy of
eSimplicity’s proposal or only a log entry for the submission, but according to the
technician who performed the investigation, the e-mail containing the proposal was
31.8 MB. Id.2 Even though the DISA server did not complete delivery, the technician
confirmed that no delivery failure notice was sent to eSimplicity. AR 162.
       The Navy then sent eSimplicity a letter explaining that the proposal was late
and would not be considered. AR 168. The Navy’s stated reason for its determination
was that the proposal had not been received “by the exact time specified in the
solicitation” and that the FAR 52.212-1(f)(2)(i)(A) “electronic commerce” exception —
for electronic submissions received by 5:00 p.m. the working day before the deadline
— was unmet. Id.
       The present lawsuit and the parties’ cross-motions followed.

                                         DISCUSSION
I.   Legal Standards
     A. Standing
       To reach the merits of the case, I must first determine that the Court has
jurisdiction over eSimplicity’s claims. See Steel Co. v. Citizens for a Better Env’t, 523
U.S. 83, 94 (1998). This Court’s jurisdiction in bid protests rests on the Tucker Act,
as amended by the Administrative Dispute Resolution Act of 1996, Pub. L. No. 104-
320, § 12(a)–(b), 110 Stat. 3870, 3874 (1996) (codified at 28 U.S.C. § 1491(b)); see
Dyonyx, L.P. v. United States, 83 Fed. Cl. 460, 464–65 (2008). The Tucker Act now
grants this Court jurisdiction “to render judgment on an action by an interested party

2 The record does not explain the discrepancy in file sizes between eSimplicity’s screenshot and the
DISA investigation. eSimplicity suggests that the DISA server may modify proposals in some way that
increases file sizes. Tr. at 38.

                                               -3-
objecting to a solicitation by a Federal agency for bids or proposals for a proposed
contract or to … the award of a contract or any alleged violation of statute or
regulation in connection with a procurement[.]” 28 U.S.C. § 1491(b)(1).
       “[S]tanding is a threshold jurisdictional issue,” Myers Investigative & Sec.
Servs., Inc. v. United States, 275 F.3d 1366, 1369 (Fed. Cir. 2002), and only an
“interested party” has standing to challenge a solicitation. See Weeks Marine, Inc. v.
United States, 575 F.3d 1352, 1358–59 (Fed. Cir. 2009). In pre-award bid protests, a
plaintiff establishes that it is an interested party by showing (1) that it is an actual
or prospective bidder, see Am. Fed’n of Gov’t Employees, AFL-CIO v. United States,
258 F.3d 1294, 1302 (2001), and (2) that it has a “direct economic interest” in the
contract’s award, see Weeks Marine, 575 F.3d at 1360, an element that in turn
requires the bidder to show a “non-trivial competitive injury which can be addressed
by judicial relief,” id. at 1362.
       Here, there is no dispute that eSimplicity is an actual bidder. And the
government does not disagree that eSimplicity suffered a non-trivial competitive
injury when its proposal was rejected. This Court has held that rejection of a proposal
without substantive consideration is a non-trivial competitive injury. See T Square
Logistics Services Corp. v. United States, 134 Fed. Cl. 550, 556 (2017); see also
Distributed Solutions, Inc. v. United States, 104 Fed. Cl. 368, 380–81 (2012). That
injury can be redressed by this Court. I therefore conclude that eSimplicity has
standing.
   B. Merits
        This Court reviews bid protests “pursuant to the standards set forth in section
706 of title 5,” i.e., the Administrative Procedure Act (“APA”). 28 U.S.C. § 1491(b)(4);
see Banknote Corp. of Am., Inc. v. United States, 365 F.3d 1345, 1350 (Fed. Cir. 2004).
That standard requires the Court to consider whether the contracting agency’s action
was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with
law and, if so, whether the error is prejudicial.” Glenn Def. Marine (ASIA), PTE Ltd.
v. United States, 720 F.3d 901, 907 (Fed. Cir. 2013). There are two bases for setting
aside government procurements as arbitrary and capricious: “(1) the procurement
official’s decision lacked a rational basis; or (2) the procurement procedure involved
a violation of regulation or procedure.” Impresa Construzioni Geom. Domenico Garufi
v. United States, 238 F.3d 1324, 1332 (Fed. Cir. 2001); see also Bannum, Inc. v. United
States, 404 F.3d 1346, 1351 (Fed. Cir. 2005); Advanced Data Concepts, Inc. v. United
States, 216 F.3d 1054, 1057–58 (Fed. Cir. 2000).
      The first route involves determining “whether the contracting agency provided
a coherent and reasonable explanation of its exercise of discretion.” Impresa, 238 F.3d

                                         -4-
at 1332–33 (quotes omitted) (citing Latecoere Int’l, Inc. v. United States Dep’t of Navy,
19 F.3d 1342, 1356 (11th Cir. 1994)). To succeed in that way, “the disappointed bidder
bears a heavy burden of showing that the award decision had no rational basis.” Id.
at 1333 (quotes omitted) (citing Saratoga Dev. Corp. v. United States, 21 F.3d 445,
456 (D.C. Cir. 1994)). The second route requires the disappointed bidder to “show a
clear and prejudicial violation of applicable statutes or regulations.” Id. (quotes
omitted). This Court has denied relief where the violation is not “clear,” but merely
“colorable.” FirstLine Transp. Sec. v. United States, 107 Fed. Cl. 189, 205 (2012). In
either case, review is “highly deferential” to agency decision-making. Id. at 196 (citing
Advanced Data Concepts, 216 F.3d at 1058).
      The applicable standards also require a protestor to demonstrate, on the
merits, that it was prejudiced by the agency’s conduct. 5 U.S.C. § 706; see also, e.g.,
Glenn Def. Marine, 720 F.3d at 907; Bannum, 404 F.3d at 1351.
       When resolving motions for judgment on the administrative record under Rule
52.1(c), this Court proceeds “as if it were conducting a trial on the record.” Bannum,
404 F.3d at 1354 (addressing former RCFC 56.1); see also Young v. United States, 497
F. App’x 53, 58–59 (Fed. Cir. 2012).
II. Unstated Evaluation Criteria
       The Navy did not specify a file-size limit in the Solicitation. But because of the
size of eSimplicity’s proposal, the proposal did not reach its destination, so the Navy
deemed it late and refused to consider it. eSimplicity contends that because the Navy
in effect rejected the proposal because of its size, the Navy applied an unstated
evaluation criterion that was not included in the Solicitation.3 Pl.’s MJAR at 18. I
conclude that the file size limitation was an unstated criterion, and that the Navy
therefore acted arbitrarily and capriciously when it rejected eSimplicity’s proposal.
       The Navy’s obligation to state the criteria for evaluating proposals is well
established: Agencies must evaluate proposals “based solely on the factors specified
in the solicitation.” 41 U.S.C. § 3701(a); see also FAR 15.305(a). That means agencies
“may not rely upon undisclosed evaluation criteria in evaluating proposals.”4
Banknote Corp. of America, Inc. v. United States, 56 Fed. Cl. 377, 386 (2003) (citing
Acra, Inc. v. United States, 44 Fed. Cl. 288, 293 (1999)), aff’d, 365 F.3d 1345. That
obligation extends to every basis the agency might rely on to accept or reject a bid:

3 eSimplicity argues in the alternative that because the Solicitation did not mention a file size limit, it
contained a latent ambiguity. See Tr. at 40. I need not reach that characterization of the issue.
4 This Court has often stated that an agency does not need to identify elements in a solicitation that

are “intrinsic to the stated factors.” See, e.g., Analytical & Research Tech., Inc. v. United States, 39
Fed. Cl. 34, 45 (1997). But the file size of proposals does not appear to be intrinsic to any other criterion
in the Solicitation, and the government has not argued that it is.

                                                    -5-
“All factors … that will affect contract award … shall be stated clearly in the
solicitation[.]” FAR 15.304(d).5
        To prevail on its claim that the Navy acted arbitrarily and capriciously by
rejecting eSimplicity’s proposal because of its file size, eSimplicity “must show that
(i) the [Navy] used a significantly different basis in evaluating the proposals than was
disclosed; and (ii) [eSimplicity] was prejudiced as a result — that it had a substantial
chance to receive the contract award but for that error.” Banknote, 56 Fed. Cl. at 387;
see also Frawner Corp. v. United States, ___ Fed. Cl. ___, No. 22-cv-0078, 2022 WL
3211218, at *14 (2022).
        Those elements are met. As to the first, the government does not argue that a
file size limit was specified in the Solicitation in any way, see 41 U.S.C. § 3701(a); see
also FAR 15.305(a), let alone that it was “stated clearly,” FAR 15.304(d). But file size
was plainly a “factor[] … that … affect[ed] contract award.” Id. The government’s sole
reason for rejecting eSimplicity’s proposal is its supposed lateness, and the sole
reason for deeming it late is that it was too large for the destination server to accept
it from the DISA server. Ergo, the government rejected eSimplicity’s proposal based
on its size: an unstated factor “significantly different” from the criteria mentioned in
the Solicitation. Banknote, 56 Fed. Cl. at 387.
       The government asserts that the Solicitation’s direction to submit proposals by
e-mail was “sufficient” to put bidders on notice that “oversized email attachments
may be rejected as undeliverable by the gateway server.” Def.’s MJAR at 31. That
argument is not based on facts in the record, but on what the government presumes
to be common experience with e-mail systems. The problem for the government is
that even if eSimplicity should have been aware that the government e-mail servers
had some theoretical limit on the file sizes they can accept and transmit, nothing in
the record shows eSimplicity had notice of what the actual limit was. The government
does not argue that eSimplicity was obligated to inquire about a size limit. Tr. at 76.
       Moreover, even if eSimplicity should have known that “oversized email
attachments may be rejected as undeliverable by the gateway server,” Def.’s MJAR
at 31, the DISA server appears to have accepted eSimplicity’s proposal — it was the
destination server that rejected it — and never sent eSimplicity a notification of
delivery failure. AR 162, 165.6 Rejecting eSimplicity’s proposal when the e-mail was

5 The word “shall” usually indicates that language is mandatory. Nat’l Ass’n of Home Builders v. Defs.
of Wildlife, 551 U.S. 644, 661–62 (2007); Lopez v. Davis, 531 U.S. 230, 241 (2001).
6 The government analogizes this case’s facts to a physical mailing: “A solicitation that accepts

proposals by mail, for example, need not explain that insufficient postage will result in an undelivered
mailing.” Def.’s MJAR at 31. If anything, that cuts the other way. Postage rates — unlike the
government e-mail servers’ file-size limits — are set by regulation and available to the public. See U.S.

                                                  -6-
not “rejected as undeliverable by the gateway server,” and where the servers did not
put eSimplicity on notice that delivery had failed, thus went beyond the criteria e-
mail users should have been expected to anticipate. Def.’s MJAR at 31; Banknote, 56
Fed. Cl. at 387.
       The government also argues that a file-size limit is “not a substantive
requirement for proposals but, instead, an instruction to potentially aid in the
delivery of a proposal.” Def.’s MJAR at 31. The FAR’s requirement that agencies state
evaluation criteria in solicitations, though, is not limited to “substantive
requirement[s].” Id. Rather, it applies to “[a]ll factors … that will affect contract
award[.]” FAR 15.304(d).7 Those terms cover both substantive and non-substantive
factors.
       As to the second element, eSimplicity was prejudiced by the Navy’s rejection of
its proposal. Although distinct from a protestor’s burden to show standing, see
Management & Training Corp. v. United States, 115 Fed. Cl. 26, 36 (2014), the test
for prejudice on the merits in bid protests generally involves the same inquiry.8 In a
pre-award protest, that means considering whether the protestor has shown a “non-
trivial competitive injury[.]” Savantage Fin. Serv., Inc. v. United States, 150 Fed. Cl.
307, 317–18 (2020) (quoting Oracle America, Inc. v. United States, 975 F.3d 1279,
1291 (Fed. Cir. 2020) (itself quoting Labatt Food Serv., Inc. v. United States, 577 F.3d
1375, 1378 (Fed. Cir. 2009))) (quotes omitted); see also Weeks Marine, 575 F.3d at
1362.9
      Erroneous rejection of an otherwise acceptable proposal without substantive
consideration generally constitutes a non-trivial competitive injury. Electronic On-

POSTAL SERV., PRICE LIST (2022); U.S. POSTAL SERV., U.S. POSTAL SERV. ANNOUNCES PROPOSED
TEMPORARY RATE ADJUSTMENTS FOR 2022 PEAK HOLIDAY SEASON (AUG. 10, 2022).
7 In fact, solicitations have stated file-size limits on many recent occasions. See DEP’T OF DEFENSE,

MRR LANDSCAPE AND MAINTENANCE SOLICITATION, H92257-22-Q-0043 (2022) (stating that “[e]mail
attachments are limited to no more than 10 MB”); DEP’T OF DEFENSE, PROJECT CSC-15761-REPAIR AND
SEAL FLOORS, SP4702-18-R-0534 (2022) (stating that the “acquisition specialist shall authorize receipt
of e-mailed proposals only on those solicitations where there is a reasonable expectation the proposal
will not exceed the maximum size limit of 15 MB”); DEP’T OF INTERIOR, EAST OREGON MANUAL
HAZARDOUS FUEL REDUCTION, 140L0622R0014 (2022) (stating that “[t]he electronic file must be under
5 MB total to ensure it can be received by e-mail”).
8 “The difference between the two is that the prejudice determination for purposes of standing assumes

all non-frivolous allegations to be true, whereas the post-merits prejudice determination is based only
on those allegations which have been proven true.” L-3 Commc’ns Corp. v. United States, 99 Fed. Cl.
283, 289 (2011).
9 A higher standard, under which the protestor must show that “but for the error, it would have had a

substantial chance of securing the contract,” applies where “there is an adequate factual predicate” to
apply it. Savantage, 150 Fed. Cl. at 317–18 (quoting Oracle America, 975 F.3d at 1291 n.3) (quotes
omitted). In this case, where the administrative record is silent on the contents of the proposals
submitted in response to the Solicitation, there is no way to evaluate eSimplicity’s chance of award.

                                                 -7-
Ramp, Inc. v. United States, 104 Fed. Cl. 151, 158, 169 (2012). Lost opportunity to
compete in fact constitutes irreparable harm for purposes of injunctive relief. See,
e.g., T Square, 134 Fed. Cl. at 560; RLB Contracting, Inc. v. United States, 118 Fed.
Cl. 750, 761 (2014), aff’d, 621 F. App’x 1026 (Fed. Cir. 2015); Electronic On-Ramp,
104 Fed. Cl. at 169. I therefore conclude that eSimplicity has shown prejudice in this
case. The case shall be remanded to the Navy on the terms set out below.
III.   Government Control Exception
        The Navy rejected eSimplicity’s proposal as untimely because it was “received
at the Government office designated in the solicitation after the exact time specified
for receipt of offers,” FAR 52.212-1(f)(2)(i), and because the “electronic commerce”
exception — covering proposals “received at the initial point of entry to the
Government infrastructure not later than 5:00 p.m. one working day prior to the date
specified for receipt of offers,” FAR 52.212-1(f)(2)(i)(A) — was unmet. eSimplicity
argues that the Navy should also have considered the “government control” exception,
which applies when “[t]here is acceptable evidence to establish that [a proposal] was
received at the Government installation designated for receipt of offers and was under
the Government’s control prior to the time set for receipt of offers.” FAR 52.212-
1(f)(2)(i)(B); see Pl.’s MJAR at 9–17. The Navy responds that when proposals are
submitted by e-mail, the electronic commerce exception is the sole exception to the
“late is late” rule, and the government control exception is inapplicable. Def.’s MJAR
at 9.
        I agree with eSimplicity that it was arbitrary and capricious for the Navy to
fail to consider the government control exception.
   A. This Court’s precedent is split
      The Federal Circuit has not resolved whether the government control
exception applies to electronically submitted proposals. This Court has addressed the
question several times, with divergent conclusions and reasons.
       This Court held in Conscoop-Consorzia Fra Cooperative Di Prod. E. Lavoro v.
United States that the government control exception only applies to proposals
submitted through non-electronic methods. 62 Fed. Cl. 219, 239–40 (2004) (applying
similar timeliness requirements and exceptions in FAR 52.215–1(c)(3)). The Court
relied on a GAO opinion concluding that applying the government control exception
to electronic submissions “would essentially render the first exception [i.e., the
electronic commerce exception] a nullity,” thus contravening the “fundamental
principle that statutes and regulations must be read and interpreted as a whole,

                                         -8-
thereby giving effect to all provisions.” Id. (quoting Sea Box, Inc., B–291056, 2002
CPD ¶ 181, 2002 WL 31445297, at *2 (Comp. Gen. Oct. 31, 2002)).10
       There are two problems with that reasoning. First — as discussed in more
detail below — it is not evident that the electronic commerce exception would in fact
become a “nullity” if the government control exception also applied to electronic
submissions. Second, and more importantly, the Supreme Court has since made clear
that giving meaning to each provision in an enacted text is not a “fundamental
principle,” id., but simply a “clue as to the better interpretation” of a text, for
“[s]ometimes the better overall reading … contains some redundancy.” Rimini Street,
Inc. v. Oracle USA, Inc., 139 S. Ct. 873, 881 (2019);11 see also Barton v. Barr, 140 S.
Ct. 1442, 1453 (2020); King v. Burwell, 576 U.S. 473, 491 (2015); Kawashima v.
Holder, 565 U.S. 478, 487–88 (2012); Lamie v. United States Trustee, 540 U.S. 526,
536 (2004). Rejecting a reading of a regulation merely because it would render part
of the regulation redundant, without also considering whether that reading is the
“better interpretation” of the regulation as a whole, is thus incomplete. Rimini Street,
139 S. Ct. at 881.
      In contrast, several cases after Conscoop-Consorzia have applied the
government control exception to electronic submissions. Those cases, though, are
subject to criticisms of their own.
       In Watterson Construction Co. v. United States, the Court reviewed the
regulatory history of the timeliness exceptions and found that the electronic
commerce exception was originally “targeted ‘to accommodate the use of electronic
systems which batch-process communications overnight and therefore, require receipt
of information one day in advance to ensure timely delivery to the designated
address.’” 98 Fed. Cl. 84, 96 (2011) (quoting Federal Acquisition Regulation Proposed
Rule, 60 Fed. Reg. 12,384, 12,389 (proposed Mar. 6, 1995)) (applying FAR 52.215–
1(c)(3)). Because batch-processing was “the raison d’être” of the electronic
communications exception, id., the Court concluded that “in cases of non-batch
delivered electronic commerce, late proposals may be excused under any of the three
exceptions” in the regulation, including the government control exception. Id. at 97
(emphasis added). The electronic commerce exception presumably would be the
exclusive exception for batch-processed e-mails.

10 The GAO continues to maintain that interpretation of the relevant regulations. Versa Integrated
Sols., Inc., B-420530, 2022 WL 1165978 at *3 (Comp. Gen. Apr. 13, 2022); People, Technology &
Processes, LLC, B-419385, 2021 WL 873350 at *7 (Comp. Gen. Feb. 2, 2021).
11 Tesoro Hawaii Corp. v. United States, 405 F.3d 1339, 1346 (Fed. Cir. 2005) (noting that a court

“construe[s] a regulation in the same manner as we construe a statute”).

                                              -9-
       That is not consistent with the usual rules of textual interpretation either. The
electronic commerce exception’s text makes no distinction between batch-processed
communications and other media. On the contrary, as the Court acknowledged, id. at
96 n.25, the FAR defines “electronic commerce” as “electronic techniques for
accomplishing business transactions including electronic mail or messaging, World
Wide Web technology, electronic bulletin boards, purchase cards, electronic funds
transfer, and electronic data interchange” — a definition that does not even mention
batch-processed e-mails and obviously extends to many other electronic
communication methods. See FAR 2.101. That leaves no textual basis in the
regulations for the Watterson Construction Court’s reasoning. Concern about batch-
processed e-mails may have been the expressed reason for proposing the electronic
commerce exception, but pre-enactment considerations expressed in the Federal
Register do not override a regulation’s text. See Glycine & More, Inc. v. United States,
880 F.3d 1335, 1344 (Fed. Cir. 2018).
       The Court revisited the issue in Insight Systems Corp. v. United States, holding
that the government control exception applies to all electronically submitted
proposals. 110 Fed. Cl. 564, 576 (2013). After concluding that electronic
communications could be “received” at an “installation,” as would be necessary to
satisfy the government control exception, id. at 576–78, the Court addressed the
government’s argument that applying the government control exception would
render the electronic commerce exception superfluous. Id. at 578–81.
       The Court held that applying the government control exception to electronic
submissions would not make the electronic commerce exception superfluous, but its
reasons are difficult to understand. The Court explained that while the electronic
commerce exception “creates a safe harbor for proposals transmitted using an
electronic commerce method” by 5:00 p.m. the day before the proposal is due, “the
other exceptions, however, still apply” if the electronic submission is submitted
afterward. Id. at 578–79. “Viewed this way,” the Court said, “it is evident that these
provisions do not have coincident operation,” so applying both to electronic proposals
would not create surplusage. Id. at 579.
       That is hard to square with the applicable canons. Words in an enacted text
are superfluous if they do not change the text’s practical, operational meaning — or,
put another way, if the text would have the same practical effect if the words were
removed. See McFeely v. Commissioner of Internal Revenue, 296 U.S. 102, 107 (1935);
cf. Nielsen v. Preap, 139 S. Ct. 954, 969 (2019). The Court’s reasoning thus missed the
point. What matters is not whether other exceptions might apply when the electronic
commerce exception does not, let alone whether it could be labeled a “safe harbor,”
but whether there is any set of facts where the electronic commerce exception is the
                                         - 10 -
only one that applies. If no such set of facts exists, the electronic commerce exception
could be removed without effect, because other exceptions would cover all of its
applications. In that circumstance, the electronic commerce exception would be
surplusage — with whatever significance that might have.
       The Insight Systems Court did not address the real question in any depth. The
Court observed in a footnote that because the government control exception “requires
not only that the proposal be received, but also that it be under the ‘government’s
control,’” while the electronic commerce exception requires only that a proposal be
“received,” there might be situations where a proposal is “received” in time for the
electronic commerce exception to apply but is never under government “control.” Id.
at 579 n.20. In such a case, the electronic commerce exception would be satisfied but
the government control exception would not. The Court suggested that distinction
might matter if “an electronic transmission is received at the entry point by 5:00 pm
on the day before submissions are due, but rejected by the initial server in the
agency’s mail system and returned to the sender,” because “[i]n that instance, the
transmission might qualify under the safe harbor, even though it was not under the
government’s control.” Id. Yet the Court did not elaborate on why those facts involve
“receipt” of an electronic submission but not “control.”
      Two subsequent decisions of this Court follow Watterson Construction and
Insight Systems, but with little additional analysis. In Federal Acquisition Services
Team, LLC v. United States (“FAST”), where the government did not argue against
application of the government control exception to electronic communications, this
Court adopted the incomplete reasoning from the prior cases “without reservation.”
124 Fed. Cl. 690, 703 (2016). And in KGL Food Services WLL v. United States, this
Court held that the elements of the government control exception were not met
without reassessing the reasoning of the past cases. 153 Fed. Cl. 497, 509–10 (2021).
      In short, the decisions of nearly twenty years of litigation on the precise issue
the parties present here are of limited use for resolving this case.
     B. The government control exception encompasses electronically
        submitted proposals
     For several reasons, I conclude that the government control exception
encompasses electronically submitted proposals.12

12eSimplicity argues — based on publicly available portions of the record in FAST and KGL — that
the government should be judicially estopped from arguing that the government control exception is
inapplicable. Pl.’s R&R at 3. Although there is no authoritative statement of the elements of judicial
estoppel in this Court, at least two factors are essential. New Hampshire v. Maine, 532 U.S. 742, 750
(2001). “First, a party’s later position must be ‘clearly inconsistent’ with its earlier position.” Id.

                                                - 11 -
       As this Court held in Insight Systems, the terms of the government control
exception are as amenable to electronic submissions as to paper ones. The exception
applies, again, when a proposal was “received at the Government installation
designated for receipt of offers and was under the Government’s control prior to the
time set for receipt of offers.” FAR 52.212-1(f)(2)(i)(B). Absent a regulatory definition,
words in a regulation are controlled by their plain and ordinary meaning. Tesoro
Hawaii, 405 F.3d at 1346–47 (citing Bowles v. Seminole Rock & Sand Co., 325 U.S.
410, 414–15 (1945)). The government does not seriously dispute the Insight Systems
Court’s conclusion that an electronic proposal can be “received” and “under [the
recipient’s] control,” in some sense, even if the nature of receipt and control differ for
electronic and physical documents. Moreover, the government does not seem to
disagree that an “installation” can include a government office’s electronic
components, such as e-mail servers. See Installation, Oxford English Dictionary,
https://tinyurl.com/bddz6xtn (last visited Sept. 6, 2022) (“[A] mechanical apparatus
set up or put in position for use.”)
       Rather, the government’s argument is that applying the government control
exception to electronic proposals, in addition to the electronic commerce exception,
would violate the principle that the specific controls the general, and thereby create
surplusage.13 I follow the majority of this Court’s decisions (albeit for somewhat
different reasons) in rejecting the government’s argument.

(quoting United States v. Hook, 195 F.3d 299, 306 (7th Cir. 1999). Second, the party must have
succeeded in persuading the court to adopt its earlier position. Id.
         As to FAST, eSimplicity has not shown that the government’s position was clearly inconsistent
with the government’s position here. The government in FAST declined to argue that the government
control exception is inapplicable to electronic proposals, but argued instead that the exception was not
satisfied on the facts. 124 Fed. Cl. at 702. eSimplicity cites no authority for the proposition that waiving
an argument in one case is clearly inconsistent with asserting the argument in a later case.
         In addition, the government did not persuade the Court to adopt its position in either case. In
FAST, the Court rejected the government’s argument that precedents applying the government control
exception could be distinguished on their facts. FAST, 124 Fed. Cl. at 704. In KGL, the government
argued that the government control exception did apply to an emailed proposal, but the Court rejected
its argument because the record did not show receipt or control. KGL, 153 Fed. Cl. at 509.
13 The government also argues that applying the government control exception would “place[]

contracting officers in the precarious position of making important procurement decisions without any
certainty regarding the law or how to apply it,” in part because “a contracting officer who becomes
aware that an offeror attempted to submit a proposal that was delivered late or was never received
must commence an investigation into the transmission of the proposal, which can be a cumbersome
process involving third-party systems and agencies.” Def.’s MJAR at 22. Neither consideration
overrides the regulatory text, and neither is persuasive on its own terms. To the extent contracting
officers face confusion about the law, it predates this case by more than a decade and only the Federal
Circuit or Supreme Court (or a revision of the regulations) can resolve it definitively. Likewise,
investigating compliance with the electronic commerce exception would presumably involve technical
challenges of its own, challenges that would arise more frequently if bidders felt the need to submit
electronic proposals a day early in order to avoid the situation presented in this case.

                                                  - 12 -
       First, it does not appear that applying both exceptions to electronic proposals
would in fact turn the electronic commerce exception into surplusage. One of the
“most basic interpretive canons” is that “a statute or regulation ‘should be construed
so that effect is given to all its provisions, so that no part will be inoperative or
superfluous, void, or insignificant[.]’” Baude v. United States, 955 F.3d 1290, 1305
(Fed. Cir. 2020) (quoting Corley v. United States, 556 U.S. 303, 314 (2009)). Yet
textual differences between the electronic commerce and government control
exception suggest that the former may have at least some applications where the
latter does not, meaning that it would not be surplusage even if both exceptions could
be applied.
       As Insight Systems observed, the government control exception requires both
receipt and “control” of proposals, while the electronic commerce exception requires
only receipt. 110 Fed. Cl. at 579 n.20. In addition, while the government control
exception requires that proposals be received “at the Government installation
designated for receipt of offers,” FAR 52.212-1(f)(2)(i)(B), the electronic commerce
exception requires receipt “at the initial point of entry to the Government
infrastructure,” FAR 52.212-1(f)(2)(i)(A). The phrases presumably have different
meanings. See Wisconsin Central Ltd. v. United States, 138 S. Ct. 2067, 2071 (2018);
Henson v. Santander Consumer USA Inc., 137 S. Ct. 1718, 1723 (2017); Russello v.
United States, 464 U.S. 16, 23 (1983); Antonin Scalia & Bryan A. Garner, Reading
Law: The Interpretation of Legal Texts 170 (2012) (“[W]here the document has used
one term in one place, and a materially different term in another, the presumption is
that the different term denotes a different idea.”).
       Neither party has fully explained those textual differences. Nonetheless,
taking the regulation’s words seriously implies that there are situations where an
electronic communication will be received at the time needed to satisfy the electronic
commerce exception, but not at the particular server or with the degree of government
control needed to satisfy the government control exception. Tr. at 61–63. Because the
electronic commerce exception would apply in such situations while the government
control exception would not, the electronic commerce exception changes the
regulation’s practical effect and therefore is not surplusage.
       The government’s surplusage argument creates problems of its own. The
premise of the argument — that applying the government control exception to
electronic submissions would nullify the electronic commerce exception — can only
be correct if there is no situation where the electronic commerce exception applies
and the government control exception (assuming it can cover electronic submissions)
would not also apply. After all, unless the government control exception covers every
case where the electronic commerce exception applies, the electronic commerce
                                        - 13 -
exception has some independent application that changes the regulation’s practical
effect. But as shown, the two exceptions have textual differences, and the government
control exception has at least one requirement that the electronic commerce exception
omits: the requirement for “control” as well as receipt. FAR 52.212-1(f)(2)(i)(B). The
government’s effort to save the electronic commerce exception from redundancy thus
implies that the government control exception’s “control” element adds nothing to the
regulation’s meaning,14 and is itself surplusage. The government’s argument does not
solve a surplusage problem; it assumes surplusage, just in a different part of the
regulation.
       That has two related consequences. The rule against surplusage does not apply
in circumstances where all competing interpretations of a text make terms
superfluous. See Seila Law LLC v. Consumer Financial Protection Bureau, 140 S. Ct.
2183, 2210 (2020); Marx v. General Revenue Corp., 568 U.S. 371, 385 (2013); Microsoft
Corp. v. i4i L. P., 564 U.S. 91, 106 (2011). Because the government’s own theory leaves
at least some surplusage, the canon does the government no good. Similarly, where
the rule against surplusage does apply, its significance is that given the choice, courts
should adopt interpretations of enacted texts that give meaning to every word over
interpretations that do not. See Marx, 568 U.S. at 385; Microsoft Corp., 564 U.S. at
106.15 This Court can do so by applying the government control exception to electronic
submissions.
       My second reason for rejecting the government’s interpretation is that the
government misapplies the canon that specific provisions displace general provisions.
Def.’s MJAR at 16.
      The government’s theory is that because the electronic commerce exception
applies “[i]f [a proposal] was transmitted through an electronic commerce method
authorized by the solicitation,” FAR 52.212-1(f)(2)(i)(A), it is the exception to the “late

14 Because it would mean that requiring receipt plus control covers a range of circumstances as wide
as requiring receipt alone.
15 As noted above, “the rule against surplusage is not absolute[.]” Linda Jellum & David Charles

Hricik, Modern Statutory Interpretation 147–48 (2006). “[R]edundancies are common in statutory
drafting — sometimes in a congressional effort to be doubly sure, sometimes because of congressional
inadvertence or lack of foresight, or sometimes simply because of the shortcomings of human
communication. The [Supreme] Court has often recognized: ‘Sometimes the better overall reading of
the statute contains some redundancy.’” Barton, 140 S. Ct. at 1453 (quoting Rimini Street, 139 S. Ct.
at 881); see also Reading Law 174–79 (“Sometimes drafters do repeat themselves and do include words
that add nothing of substance, out of a flawed sense of style or to engage in the ill-conceived but
lamentably common belt-and-suspenders approach.”). The same logic extends to interpreting agency
regulations. See Glycine & More, 880 F.3d at 1344; Roberto v. Dep’t of Navy, 440 F.3d 1341, 1350 (Fed.
Cir. 2006). Several aspects of the regulation show that the “better overall reading” is eSimplicity’s.
Barton, 140 S. Ct. at 1453 (quoting Rimini Street, 139 S. Ct. at 881).

                                               - 14 -
is late” rule applicable specifically to electronic submissions, and therefore displaces
the government control exception. But the government ignores the third exception,
which applies when, “[i]f this solicitation is a request for proposals, [a late proposal]
was the only proposal received.” FAR 52.212-1(f)(2)(i)(C). Both exceptions contain a
condition (“if”) limiting them to specific kinds of submissions. Those conditions should
ordinarily be read in pari materia. See, e.g., Strategic Hous. Fin. Corp. of Travis
County v. United States, 608 F.3d 1317, 1330 (Fed. Cir. 2010); Branch v. Smith, 538
U.S. 254, 381 (2003); Erlenbaugh v. United States, 409 U.S. 239, 243 (1972). On the
government’s logic, then, the third exception should be the only exception applicable
to responses to requests for proposals. But the conditions for applying the exceptions
overlap: What to do with an electronic response to a request for proposals? Treating
the exceptions as exclusive within their domains, as the government contends is
required by the rule that the specific displaces the general, puts them in conflict. The
way to avoid the conflict is to treat the exceptions as limited, but not exclusive — in
which case there is no reason for the electronic commerce exception to displace the
government control exception.16 See Varity Corp. v. Howe, 516 U.S. 489, 511 (1996).
        Although the government control exception can apply to electronically
submitted proposals, I do not resolve whether its elements are met in this case. For
it to apply, four elements must be proven: (1) the offer must be “received before award
is made,” (2) “the Contracting Officer [must] determine[] that accepting the late offer
would not unduly delay the acquisition”; and “[t]here [must be] acceptable evidence
to establish [3] that [the offer] was received at the Government installation
designated for receipt of offers and [4] was under the Government’s control prior to
the time set for receipt of offers.” FAR 52.212-1(f)(2)(i). The Navy never made the
relevant determinations, and the record does not permit findings on those elements
here. See Tr. at 25–26.17 The Navy should address those matters on remand as
necessary. See ARKAY USA, Inc. v. United States, 117 Fed. Cl. 22, 27, 29 (2014);
Nutech Laundry & Textile, Inc. v. United States, 56 Fed. Cl. 588, 594 (2003); see also
Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985).

16 That reading is perfectly consistent with ordinary usage, for it is hardly unnatural for conditional
language to create a new alternative without displacing other possibilities. “Members of the wedding
party must arrive by 12:30 p.m. Those staying off-site should make travel plans accordingly. If you tell
me that you do not have a car, I will arrange a taxi for you.”
17 In other cases addressing similar legal questions, the Court apparently had the benefit of a more

detailed factual record on the relevant servers, their relationship to each other, and their processing
of the proposals at issue. FAST, 124 Fed. Cl. at 698–700, 704–05; Insight Systems, 110 Fed. Cl. at 570–
72.

                                                - 15 -
IV. Injunctive Relief is Appropriate
       eSimplicity has requested an injunction. Pl.’s MJAR at 20–23. The following
test applies:
      Once a plaintiff has succeeded on the merits, in determining whether to
      grant a permanent injunction, the court considers three factors:
      (1) whether the plaintiff will suffer irreparable harm if the procurement
      is not enjoined; (2) whether the harm suffered by the plaintiff, if the
      procurement action is not enjoined, will outweigh the harm to the
      government and third parties; and (3) whether granting injunctive relief
      serves (or is at least not contrary to) the public interest.
FAST, 124 Fed. Cl. at 707–08 (citing Centech Grp., Inc. v. United States, 554 F.3d
1029, 1037 (Fed. Cir. 2009); PGBA, LLC v. United States, 389 F.3d 1219, 1228–29
(Fed. Cir. 2004); and Supreme Foodservice GmbH v. United States, 109 Fed. Cl. 369,
383 (2013)). Limited injunctive relief is appropriate to protect eSimplicity’s rights on
remand.
       First, I conclude that injunctive relief is necessary to protect eSimplicity from
irreparable harm. eSimplicity lost the opportunity to compete for a contract under
the Solicitation because the Navy erroneously rejected its proposal as untimely. “It is
well-established that the profits lost by an offeror because of the government’s
arbitrary or unlawful rejection of an offer constitute irreparable injury for purposes
of injunctive relief.” FAST, 124 Fed. Cl. at 708; see also, e.g., T Square, 134 Fed. Cl.
at 560 (“[P]laintiff has shown that absent injunctive relief, it will suffer irreparable
harm in the form of a lost opportunity to compete for the award at issue.”); RLB
Contracting, 118 Fed. Cl. at 761 (“[I]n the context of a bid protest, the loss of an
opportunity to compete for an award for which a party would not otherwise be
disqualified is sufficient injury to warrant injunctive relief.”); PGBA, LLC v. United
States, 57 Fed. Cl. 655, 664 (2003) (“[A] lost opportunity to compete may constitute
an irreparable harm[.]”). If an injunction does not issue, the Navy might consider
other proposals submitted in response to the Solicitation and award a contract
without considering eSimplicity’s proposal, a harm that could only be addressed by
additional bid protest litigation.
       Second, the government has not identified any harm that might result from an
injunction, except in the most conclusory terms. See Def.’s R&R at 10–11
(“[I]njunctive relief in this case would be drastic given its effect on the operating
efficiency of the procurement process[.]”). The record contains no evidence that might
outweigh the obvious injury to eSimplicity. I therefore conclude that the balance of
harms favors injunctive relief to protect eSimplicity. T Square, 134 Fed. Cl. at 560.

                                         - 16 -
       Third, “[t]he public interest always favors the correct application of law.” RLB
Contracting, 118 Fed. Cl. at 761. “[W]here, as here, defendant erred, it is both proper
and in the public interest, for the court to step in and protect the integrity of the
procurement process.” T Square, 134 Fed. Cl. at 561. Specific to the facts of this case,
“the public interest is unquestionably served by an injunction requiring an agency to
accept for evaluation a timely-received proposal.” FAST, 124 Fed. Cl. at 708. Given
the errors in the Navy’s rejection of eSimplicity’s proposal as untimely, it follows that
an injunction halting the procurement pending the Navy’s reconsideration would
serve the public interest.
      Because the Navy should have the opportunity to reconsider its decisions on
remand, I do not consider it in the public interest to enjoin the Navy to accept
eSimplicity’s proposal. Rather, the Court shall enjoin the Navy not to award a
contract under the Solicitation until it complies with the terms of the remand, as
further explained below.
                                    CONCLUSION
     For the foregoing reasons, Plaintiff’s motion for judgment on the
administrative record is GRANTED and Defendant’s cross-motion is DENIED.
       Pursuant to RCFC 52.2, the case is REMANDED for 60 days to the Navy for
further proceedings. The Navy is ORDERED to reconsider its decision that
eSimplicity’s proposal was untimely in light of the Court’s conclusion that the Navy’s
decision involved application of a file-size criterion that was not stated in the
Solicitation. In the event that the Navy’s reconsideration of that decision does not
lead to acceptance of eSimplicity’s proposal, the Navy is further ORDERED to
consider whether the elements of the government control exception render
eSimplicity’s proposal timely. If the Navy determines that eSimplicity’s proposal was
timely submitted, the Navy shall accept an identical resubmission of the proposal if
necessary.
       The Navy may, in the alternative, cancel the Solicitation, revise the
Solicitation to include a file size limit and new proposal deadlines, or take other action
consistent with this Opinion.
       It is further ORDERED that no later than November 28, 2022, the parties
shall file either a stipulation of dismissal or a joint status report including the Navy’s
decisions on remand.
       It is further ORDERED that if no stipulation of dismissal is filed, the parties
shall file a joint status report no later than December 27, 2022 proposing further
proceedings in this case.

                                          - 17 -
      This case shall be STAYED pending the Navy’s decision.
       The Navy is ENJOINED from making an award under the Solicitation until
further order of the Court or a joint stipulation of dismissal is filed, whichever comes
first.
       Pursuant to the Court’s May 26, 2022 Protective Order (ECF 16), this Opinion
has been issued under seal. The transcript of the September 1, 2022 hearing is under
seal as well. The parties shall have two weeks to propose redactions and, accordingly,
shall file notice of their proposed redactions no later than October 12, 2022. To aid
the Court’s evaluation of the proposed redactions and in light of the “presumption of
public access to judicial records,” Baystate Techs., Inc. v. Bowers, 283 F. App’x 808,
810 (Fed. Cir. 2008) (per curiam), each party shall file a memorandum (or a joint
memorandum if the parties agree) explaining why redactions are necessary for each
item of information for which a redaction is proposed.
      The Clerk is directed to serve a certified copy of this order on the Navy via
Regina Magee, Contracting Officer, Naval Supply Systems Command, Fleet Logistics
Center Norfolk Contracting Department, Philadelphia Office, 700 Robbins Avenue,
Building 2B, Philadelphia, PA 19111. See RCFC 52.2(b)(2).

      IT IS SO ORDERED.
                                                  s/ Stephen S. Schwartz
                                                  STEPHEN S. SCHWARTZ
                                                  Judge

                                         - 18 -