Court Opinion

ID: 1042877
Source: CourtListenerOpinion
Date Created: 2013-10-02 14:37:37.952568+00
Date Added: 2024-06-11T13:01:21.172230
License: Public Domain

In the United States Court of Federal Claims
                                      No. 13-671C
                              (Filed September 30, 2013)
                              (Reissued October 1, 2013)

*************************
                        *
MORI ASSOCIATES, INC.,  *                       Pre-award bid protest; GSA Federal Supply
                        *                       Schedules; government-wide acquisition
             Plaintiff, *                       contract; task order solicitation; FASA
                        *                       protest prohibition, 41 U.S.C. § 4106(f);
         v.             *                       no jurisdiction over protest of selection of
                        *                       task order vehicle to obtain help desk
THE UNITED STATES,      *                       services.
                        *
             Defendant. *
                        *
*************************

        Joseph G. Billings, Miles & Stockbridge P.C., Baltimore, Maryland, for plaintiff.
Rita J. Piel and Katherine B. Hill, both of Baltimore, Maryland, of counsel.

       William P. Rayel, Commercial Litigation Branch, Civil Division, Department of
Justice, with whom were Stuart F. Delery, Assistant Attorney General, Jeanne E.
Davidson, Director, and Steven J. Gillingham, Assistant Director, all of Washington,
D.C., for defendant. Mogbeyi Omatete, Office of the General Counsel, Procurement,
Fiscal and Information Law Branch, Department of Health and Human Services,
Washington, D.C., of counsel.

                    MEMORANDUM OPINION AND ORDER 1

WOLSKI, Judge.

       In this pre-award bid protest, plaintiff --- the incumbent contractor ---
challenges the government’s decision to obtain services using a procurement vehicle
under which it cannot compete for an award. Plaintiff contends that the selection of
this procurement vehicle was made arbitrarily and in bad faith, and seeks a
preliminary injunction against its use. The government has moved to dismiss the
case for lack of subject-matter jurisdiction, under Rule 12(b)(1) of the Rules of the
United States Court of Federal Claims (“RCFC”), on the ground that the vehicle
selected was a multiple-award task order contract, the protest of which is not

1 This opinion, initially filed on September 30, 2013, is reissued for publication with
some minor, non-substantive corrections.
authorized. For the reasons stated below, the government’s motion to dismiss is
GRANTED and the plaintiff’s motion for a preliminary injunction is DENIED as
MOOT.

                                I. BACKGROUND

       This dispute is the latest in a long-running series between plaintiff, MORI
Associates, Inc., (“MORI”) and the National Institutes of Health’s (“NIH”) National
Institute of Diabetes and Digestive and Kidney Diseases (“NIDDK” or “the agency”),
concerning the provision of information technology (“IT”) services. Since it was
awarded a contract in 2002, plaintiff has been providing help desk support to the
agency, as well as other IT services. Compl. ¶ 7; App. to Def.’s Mot. to Dismiss
(“DA”) at 9. The initial contract lasted for five years and expired in late 2007. DA
at 10. The follow-on procurement of IT services was attempted by soliciting
quotations from firms that hold a General Services Administration (“GSA”) Federal
Supply Schedule (“FSS”) IT Schedule 70 contract (“GSA Schedule 70”), which
included MORI. See MORI Assocs., Inc. v. United States, 102 Fed. Cl. 503, 511
(2011). Since the original contract expired, MORI has continued to perform these
services for the agency --- though the scope of that work has been steadily
decreasing, and at present MORI only provides help desk services. Compl. ¶ 7.

       Plaintiff’s performance has continued during the pendency of a series of
protests, brought by MORI in the Government Accountability Office (“GAO”) and in
our court, challenging the agency’s attempts to procure these services from other
contractors. See MORI Assocs., 102 Fed. Cl. at 510-17. It is not necessary to
recount in detail the history of these challenges to resolve the present motions. In a
nutshell, MORI thrice protested the award of a contract to Allied Technologies and
Consulting, LLC, a company whose president was allegedly a friend of the agency’s
Chief Information Officer. Id. at 511-12. Because of the promise of corrective
action, the first protest was withdrawn and the next two were dismissed by the
GAO. Id. A fourth GAO protest added the claim that proposed corrective action
had not been taken. Id. at 512; see also Compl. ¶ 10. This was followed by a protest
in our court, challenging the proposed corrective action, and evaluation and award
decisions. MORI Assocs., 102 Fed. Cl. at 513. Supplemental complaints were filed
challenging the subsequent cancellation of the procurement and the solicitation of
help desk services from a pool of contractors that did not include small businesses.
Id. at 513-17. Plaintiff prevailed in its claim that the cancellation was arbitrary,
and obtained a preliminary injunction of the help desk solicitation. Id. at 543-55.
In March 2012 the initial procurement was cancelled a second time, and MORI
challenged this in a third supplemental complaint. See Compl. ¶ 21. In addition to
statutory and regulatory violations, MORI has alleged that the agency’s past
procurement decisions were made in bad faith. Id. ¶¶ 1, 11, 14, 26.

                                         -2-
       The dispute currently before the Court concerns a new effort by the agency to
award part of the IT work, namely help desk services, using a contract vehicle
under which MORI is unable to compete. In March 2012, when the follow-on
solicitation was cancelled a second time, the agency stated that it anticipated
obtaining the help desk services through a small business set-aside competition
among GSA Schedule 70 contract holders, which included MORI. See Compl. ¶ 24;
Admin. R. at 89, MORI Assocs., Inc. v. United States, No. 10-298C (Fed. Cl., Apr. 27,
2012), ECF No. 121; Def.’s Prop. Status Report at 1, MORI Assocs., No. 10-298C
(Fed. Cl., July 22, 2013), ECF No. 149-1. In October 2010, NIH issued a solicitation
for the NIH Information Technology Acquisition and Assessment Center
(“NITAAC”) CIO-SP3 Small Business government-wide acquisition contract
(“GWAC”). Compl. ¶ 22. Awards of CIO-SP3 contracts were made in May and July
of 2012. Id. Though MORI competed for an award of a CIO-SP3 contract, it did not
receive one. Id.

        In November of 2012, the agency was still anticipating procuring help desk
services through the GSA Schedule 70 --- the same vehicle that had been used for
the initial procurement and one under which MORI could compete. DA at 1-2;
Compl. ¶ 7; see also Compl. Ex. 1 at 1. As part of the procurement process,
NIDDK’s Executive Officer, Camille Hoover, sought out the advice of contracting
officials at the National Institute of Allergy and Infectious Diseases (“NIAID”) and
the National Cancer Institute (“NCI”), which are both sub-units of NIH. Two of
these officials --- Daniel Hartinger, a branch chief at the NIAID Office of
Acquisitions, and Kristen Mistichelli, Director of NCI’s Office of Acquisitions ---
independently recommended that Ms. Hoover employ the CIO-SP3 to conduct the
procurement. DA at 2, 7-8. In response to these recommendations, Ms. Hoover
compared the two vehicles, and --- based on a number of cost and non-cost factors ---
she and Mr. Hartinger determined that the CIO-SP3 was the superior vehicle for
this procurement. DA at 2; Compl. Ex. 1 at 1. This determination was
memorialized in a memorandum issued on July 17, 2013. Compl. Ex. 1 at 1; Def.’s
Prop. Status Report at 1-2, MORI Assocs., No. 10-298C (Fed. Cl., July 22, 2013),
ECF No. 149-1. On August 1, 2013, the Agency issued a task order solicitation (No.
RFP C-30316-SB) for help desk services under the CIO-SP3. Compl. ¶ 25; DA at 17-
48.

       Plaintiff, believing the decision to use the CIO-SP3 vehicle to be both
arbitrary and made in bad faith with the intent to injure it, protested the issuance
of the task order solicitation at the GAO that same day. Compl. ¶ 26. Shortly
thereafter, on August 21, 2013, the government moved to dismiss the protest. Id.
¶ 27. On September 4, 2013, the GAO granted the government’s motion to dismiss
MORI’s protest on the ground that the protest was barred by the Federal
Acquisition Streamlining Act of 1994 (“FASA”). Id.; see also 41 U.S.C. § 4106(f). On
September 12, 2013, MORI filed its complaint in this Court, alleging that the
agency’s decision to use the CIO-SP3 vehicle to obtain help desk services was made

                                        -3-
in bad faith and in violation of statutes and regulations, 2 and was based on an
irrational comparison of the costs of using that vehicle and the GSA Schedule 70.
Compl. ¶ 1. Plaintiff seeks both permanent and preliminary injunctive relief.
Compl. at 18; Pl.’s Mem. in Supp. of Mot. for Prelim. Inj. (“Pl.’s Br.”) at 14-26. The
government opposes MORI’s request for a preliminary injunction, and has moved to
dismiss the complaint on the ground that the protest is not within our subject-
matter jurisdiction --- because it is “in connection” with the “issuance or proposed
issuance of a task order,” and thus, is barred by FASA. Def.’s Mot. to Dismiss
(“Def.’s Br.”) at 7-31. Both MORI’s motion for a preliminary injunction and the
government’s motion to dismiss have been fully briefed on an expedited schedule,
and oral argument on the motions was heard on September 25, 2013. The agency
intends to issue a task order to obtain the help desk services on October 1, 2013.
See Tr. (Sept. 25, 2013) at 106.

                                  II. DISCUSSION

       Under 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), our court
would normally:

      have 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). But this jurisdiction is curtailed by a provision of
FASA, which states that “[a] protest is not authorized in connection with the
issuance or proposed issuance of a task or delivery order,” except in circumstances
that are not relevant to this matter. 41 U.S.C. § 4106(f)(1) (2006). The question of
our jurisdiction turns on whether a protest of the decision to request proposals from
holders of a task order contract, instead of using the GSA Schedule 70, should be
considered too connected to the proposed issuance of a task order to survive the
FASA prohibition.

       It has been brought to the attention of the Court that dictum from an opinion
in the related MORI Associates case suggested an interpretation of the term
“proposed issuance” that would place the current matter outside the FASA

2  Specifically, plaintiff claims that the agency’s conduct violated the Competition in
Contracting Act, was arbitrary and capricious, and “violated several regulations
requiring fair and equal treatment of contractors.” Compl. ¶ 1; see id. ¶¶ 43-47
(citing 5 U.S.C. § 706, 41 U.S.C. § 3301(a), and 48 C.F.R. §§ 1.102(b)(3), 1.102-
2(c)(3), 1.602-2(b), 3.101-1, 6.101, 19.502-2(b)).
                                         -4-
prohibition. See Pl.’s Br. at 15 (citing MORI Assocs., 102 Fed. Cl. at 534 n.33.);
Def.’s Br. at 10-12. It was there presumed that a “proposed issuance” of a task
order would not occur until “after a source has been selected among the task order
contract holders.” MORI Assocs., 102 Fed. Cl. at 534 n.33. Thus, the Court mused
that a protest “in connection with” the issuance or proposed issuance of a task order
concerned the decision to select an awardee of a task order, “not the decision to use
the task order contracts to obtain the relevant services.” Id.

        At that time, the Court was equating a “proposed issuance” with a proposed
contract award --- the latter having been a significant concept when our equitable
relief extended only to pre-award protests, since the selection of another offeror was
often what allegedly deprived the protester of fair and honest consideration of its
offer. See, e.g., CACI, Inc.-Fed. v. United States, 719 F.2d 1567, 1574 (Fed. Cir.
1983). 3 Whether a protest affecting a solicitation for task order proposals was “in
connection with” a “proposed issuance” of a task order was not at issue in the
related MORI Associates opinion, as the Court held that a small business set-aside
decision was a “logically distinct step” that was required prior to the selection of a
procurement vehicle. MORI Assocs., 102 Fed. Cl. at 533-34. 4 Now that the issue is
more squarely presented, the Court is of the opinion that the term “proposed
issuance of a task or delivery order” is more akin conceptually to a term in the
Tucker Act other than “proposed award.” Just as a “proposed contract” is the object
of “a solicitation by a Federal agency for bids or proposals,” 28 U.S.C. § 1491(b)(1),
the “proposed issuance of a task or delivery order,” 41 U.S.C. § 4106(f), is the object
of the decision to solicit goods or services from holders of task order contracts.

       The “proposed issuance of a task or delivery order,” thus, has already
occurred with the issuance of the NITAAC CIO-SP3 solicitation for help desk
services proposals. DA at 17-48. The question still remains whether MORI’s
protest of the decision to use the task order vehicle instead of a GSA Schedule 70
competition is a protest “in connection with” this proposed issuance. Upon careful
reflection, the Court concludes it is not even a close question. The Court finds
persuasive the interpretation of the phrase “in connection with” that is contained in
the DataMill opinion. See DataMill, Inc. v. United States, 91 Fed. Cl. 740, 756
(2010). It was there explained that “the phrase ‘in connection with’ means that
there is a direct and causal relationship between two things that are mutually
dependent,” and determined that “[a]n agency’s underlying decision to procure
goods or services without competition through a delivery order has a direct and

3The breach of the implied contract to fairly and honestly consider bids could also
have resulted from the arbitrary cancellation of a solicitation. See MORI Assocs.,
102 Fed. Cl. at 522.
4 The Court also held that the FASA prohibition had expired prior to the filing of
the protest. MORI Assocs., 102 Fed. Cl. at 534-41.
                                         -5-
causal relationship to the ‘issuance’ or ‘proposed issuance’ of the delivery order that
agency ultimately utilizes to effectuate the procurement.” Id.

       Not every decision that precedes the selection of a task order vehicle is so
bound up with the proposed issuance of a task order that a protest of the decision
would be prohibited by FASA. Discrete, preliminary matters that may not
necessarily lead to the proposed issuance of a task order may still be protested.
Thus, in the related MORI Associates case, a “Rule of Two” determination under 48
C.F.R. § 19.502-2(b) was found to be required prior to the selection of a particular
procurement vehicle, since whether the work must be set aside for small business
must be known before an agency can select the means of fulfilling its needs. MORI
Assocs., 102 Fed. Cl. at 533-34. In Savantage Financial Services, the choice of
particular brand name products was found to be distinct from the use of a task
order solicitation to obtain those products. See Savantage Fin. Servs., Inc. v. United
States, 81 Fed. Cl. 300, 305, 308 (2008). And in BayFirst Solutions, the cancellation
of a solicitation (under which the protester had competed for an award) was found
to be distinct from the decision to issue a task order for a bridge contract to be
performed while a new competition was held. BayFirst Solutions, LLC v. United
States, 104 Fed. Cl. 493, 498-99, 507-08 & n.11 (2012).

       Procurement decisions that are made after task orders have been issued are
similarly not affected by the FASA prohibition. These include the assignment of
new work to an existing task order through a modification, see Global Computer
Enters., Inc. v. United States, 88 Fed. Cl. 350, 410-15 (2009), or the use of an
already-issued task order to obtain products and services through subcontracts, see
Distributed Solutions, Inc. v. United States, 104 Fed. Cl. 368, 371 n.5, 372, 380, 385
n.24 (2012). There is no direct, causal relationship between these decisions and the
issuance of task orders to fulfill an agency’s needs, since the task orders had already
issued.

         But when a protest challenges the decision to obtain services by requesting
proposals from indefinite delivery/indefinite quantity task order contract holders,
the FASA prohibition on protests clearly applies. See Mission Essential Pers., LLC
v. United States, 104 Fed. Cl. 170, 179 (2012). This is the situation presented by
this case. Plaintiff is not protesting the selection of a particular brand of help desk
services, which can be conceptually severed from the choice of the task order
vehicle, or the use of already-issued task orders to perform these services. Nor was
there a cancellation of a formal solicitation of proposals from the GSA Schedule 70
contractors. Instead, MORI protests the agency’s decision to use the NITAAC CIO-
SP3 Small Business GWAC instead of GSA Schedule 70 to obtain help desk
services. In choosing to solicit proposals from the CIO-SP3 task order contract
holders, see DA at 17-48, the agency has proposed the issuance of a task order to
fulfill its help desk needs. Plaintiff’s protest is thus clearly in connection with the
proposed issuance of a task order, and our jurisdiction is prohibited by FASA. See

                                          -6-
41 U.S.C. § 4106(f)(1). The government’s motion to dismiss the case is GRANTED,
and MORI’s motion for a preliminary injunction is DENIED as MOOT.

                               III. CONCLUSION

      For the foregoing reasons, the Court concludes that plaintiff protests a
procurement decision in connection with the proposed issuance of a task order --- a
matter which is beyond our jurisdiction due to 41 U.S.C. § 4106(f)(1). Accordingly,
the government’s motion to dismiss the case under RCFC 12(b)(1) is GRANTED,
and plaintiff’s motion for a preliminary injunction is DENIED as MOOT. The
Clerk shall close the case.

IT IS SO ORDERED.

                                       s/ Victor J. Wolski
                                       VICTOR J. WOLSKI
                                       Judge

                                        -7-