Court Opinion

ID: 8416529
Source: CourtListenerOpinion
Date Created: 2022-11-03 16:35:33.444134+00
Date Added: 2024-06-11T16:48:16.467911
License: Public Domain

SCHALL, Circuit Judge,
dissenting.
In the Court of Federal Claims, HGP argued that NPS violated CICA by not conducting a full and open competition for the QLD lease because significant changes were made in the solicitation. HGP contended that it was entitled to compete in what was, in effect, a new procurement. On appeal, HGP renews these arguments.
CICA requires “full and open competition through the use of competitive procedures.” 41 U.S.C. § 258(a)(1)(A). CICA does not prevent modification of a contract by requiring a new bid procedure for every change. “[0]nly modifications outside the scope of the original competed contract fall under the statutory competition requirement.” AT & T Communications, Inc. v. Wiltel, Inc., 1 F.3d 1201, 1205 (Fed.Cir.1998) *196(“AT & T”). In determining whether a modification falls within CICA’s competition requirement, we examine whether the contract as modified materially departs from the scope of the original procurement. Id. The analysis focuses on the scope of the entire original procurement in comparison to the scope of the contract as modified. Id. Thus, a broad original competition may validate a broader range of later modifications without further bid procedures. Id.
Several factors, such as the extent of any changes in the type of work, performance period, and costs between the contract as awarded and as modified, may be considered to determine the materiality of the modification. Neil R. Gross & Co., 90-1 CPD ¶ 212, at 2 (1990). Another factor that may be considered is whether the solicitation for the original contract adequately advised offerors of the potential for the type of changes that in fact occurred during the course of the contract, or whether the modification is of a nature which potential offerors would reasonably have anticipated under the changes clause. Id.; AT & T, 1 F.3d at 1207.
If modifications to an existing contract are such that they trigger CICA’s competition requirement, then there must be competitive bidding. See AT & T, 1 F.3d at 1205. That is what HGP sought in the Court of Federal Claims and continues to seek on appeal. Recently, in Myers Investigative and Security Servs., Inc. v. United States, 275 F.3d 1366 (Fed.Cir.2002), we stated:
In [Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 (Fed.Cir.2001) ] we considered the standard to be applied where the plaintiff claims that the government was obligated to rebid the contract (as contrasted with a situation in which the plaintiff claims that it should have received the award in the original bid process). 238 F.3d at 1334. To have standing, the plaintiff need only establish that it “could compete for the contract” if the bid process were made competitive. Id.
275 F.3d at 1370. Thus, in this case, the Court of Federal Claims was required to determine whether competitive bidding was required because of modifications in the solicitation and, if so, whether HGP “could compete for the contract.”
In my view, the trial court erred because it did not conduct an inquiry as to whether the procurement had been modified so as to trigger CICA’s competition requirements. Rather, the court simply focused on whether HGP had been improperly denied award of the lease under the solicitation. The court stated: “Since [HGP] was properly determined to be significantly beneath the scope of competition and, thus, not eligible to be considered for award under the solicitation, it is not an interested party and has no authority to bring this action.” That was not the proper inquiry. Counsel for HGP had argued to the court: “[T]he issue here is whether we were afforded an opportunity to compete on the new requirements, not whether we should have won under the original solicitation.”
HGP is able to point to abundant evidence in the record in support of its argument that the variations in the QLD lease from the solicitation, individually and collectively, were material, substantial, and beyond what offerors could have anticipated. HGP notes that in the QLD lease, the amount of space required has been reduced by over twenty percent, while the swing space has been ehminated. At the same time, other items, including a fully redundant HVAC system, a walk-in freezer, a proximity card key security system, a backup generator and associated independent fuel supply, blast resistant doors and *197windows, an air sampling high sensitivity-smoke detection system, and high ceiling heights, have been eliminated.
In addition, HGP notes that the QLD lease also differs from the solicitation with respect to the performance period. Although the solicitation sought a fifteen-year firm term with one additional five-year renewal period, the QLD lease provides for a twenty-year firm term, thereby increasing the firm term by thirty-three percent. Similarly, although the original solicitation required occupancy no later than April 1, 2002, the QLD lease was not scheduled to commence until April 1, 2003.
Finally, HGP points out that the QLD lease differs from the solicitation in terms of cost. Although the solicitation required the lessor to pay for base real estate taxes, the QLD lease provides that NPS will reimburse QLD for all real estate taxes. Similarly, although the solicitation required the lessor to pay for utilities during normal hours of building operation, the QLD lease requires NPS to pay for all utilities. HGP notes that these changes and other changes, such as elimination of a museum consultant, amounted to an annual reduction of the rent by $1,084,153, or approximately thirty-five percent.
In my view, in light of the evidence of record, it was incumbent upon the Court of Federal Claims to determine whether the QLD lease departed in material respects from the scope of the solicitation. If the trial court had conducted such an inquiry and had determined that the changes in the solicitation were such as to trigger CICA’s competition requirement, then the court would have been required to determine whether HGP “could compete” for the lease. Accordingly, I would vacate the decision of the trial court and remand the case for proceedings consistent with the above requirements.
The majority concludes that HGP did not establish that it was an interested party because it did not demonstrate that it had “a substantial chance of submitting a winning bid.” In reaching that conclusion, the majority points to evidence that it says suggests that HGP would not have been awarded the lease. As explained, however, and as HGP argues, HGP was not required to show that it had a “substantial chance” of being awarded the lease. It was only required to show that the solicitation requirements had been modified to such an extent that competition for the lease was required and that it could have competed for the lease. I believe that HGP should be given the opportunity to make that showing.
For the foregoing reasons, I most respectfully dissent.