Court Opinion

ID: 4680716
Source: CourtListenerOpinion
Date Created: 2021-04-23 20:02:04.309329+00
Date Added: 2024-06-11T09:02:23.064144
License: Public Domain

In the United States Court of Federal Claims
                                        No. 20-1116 C
                                    Filed: April 13, 2021
                                  Re-issued: April 23, 2021 1
    ________________________________________
                                                    )
    IAP WORLD SERVICES, INC.,                       )
                                                    )
                         Plaintiff,                 )
                                                    )
       v.                                           )
                                                    )
    THE UNITED STATES,                              )
                                                    )
                         Defendant,                 )
                                                    )
       and                                          )
                                                    )
    VECTRUS-J&J FACILITIES SUPPORT, LLC,            )
                                                    )
                         Defendant-Intervenor.      )
    ________________________________________ )

Anuj Vohra, Crowell & Moring LLP, Washington, D.C., for Plaintiff. Abigail Stokes, Robert
Sneckenberg, and Alexandra Barbee-Garrett, of counsel.

Galina I. Fomenkova, Trial Attorney, United States Department of Justice, Civil Division,
Washington, D.C., with whom were Brian M. Boynton, Acting Assistant Attorney General,
Robert E. Kirschman, Jr., Director, and Steven J. Gillingham, Assistant Director, of counsel, for
the Defendant. Sandra C. Simmons, Nicolle A. Vasquez, and Seth M. Eddy, United States
Department of the Navy, Office of the General Counsel, NAVFAC Atlantic, of counsel.

Adam K. Lasky, Seyfarth Shaw LLP, Seattle, WA, for Defendant-Intervenor. Bret C. Marfut,
Steven J. Kmieciak, and Sara M. Rogers, of counsel.

                                    OPINION AND ORDER

MEYERS, Judge.

        Following the Court’s remand to the Navy to conduct and document its unbalanced
pricing analysis, the sole issue remaining before the Court is whether the Navy’s conclusion that

1
 Initially filed under seal, this re-issued opinion incorporates a minor typographical correction
and the Parties’ agreed upon redactions, as indicated by bracketed ellipses (“[ … ]”) below.
there is no unbalanced pricing in any of the proposals under consideration is rational. Because
the Navy’s unbalanced pricing analysis was rational and complied with the requirements of the
Federal Acquisition Regulation (“FAR”), Plaintiff cannot prevail on the merits of its case.
Therefore, Plaintiff’s Motion for Judgment on the Administrative Record is DENIED. The
Government’s and Defendant-Intervenor’s Cross-Motions for Judgment on the Administrative
Record are GRANTED.

I.     FACTUAL AND PROCEDURAL BACKGROUND

        Because the facts of this matter are presented at length in the Court’s prior decision, see
IAP World Servs., Inc. v. United States, No. 20-1116 C, --- Fed. Cl. ---, 2021 WL 451002 (Jan.
21, 2021) (ECF No. 56) (reissued publicly with limited redactions Feb. 8, 2021 (ECF No. 60)),
they are not repeated here. As relevant to this opinion, on January 21, 2021, the Court denied-in-
part and granted-in-part Plaintiff IAP World Services, Inc.’s (“IAP”) Motion for Judgment on the
Administrative Record (ECF No. 35). See id. At the same time, the Court granted-in-part the
United States’ (“Government”) and Defendant-Intervenor Vectrus-J&J Facilities Support, LLC’s
(“VJFS”) Cross-Motions for Judgment on the Administrative Record as to most of IAP’s
Complaint but remanded the case to the Navy so that it could conduct and document a mandatory
unbalanced pricing analysis. Id., 2021 WL 451002, at *23. Based on these holdings, the Court
granted judgment to the Government and VJFS on Counts I-IV of IAP’s Complaint, but deferred
entering judgment on Count V, which addressed the Navy’s best value tradeoff, pending the
remand because the unbalanced pricing analysis stood to change the Navy’s tradeoff analysis.

        On February 9, 2021, the Government informed the Court that the Navy had completed
its unbalanced pricing analysis and “determined that no unbalanced pricing existed in any of the
proposals under consideration.” ECF No. 61 at 1. On February 19, 2021, the Government filed
its Post-Remand Amended Administrative Record (“Record” or “AR”), ECF Nos. 66 and 66-1,
consisting of the Navy’s revised decisional documents that were amended to include its
unbalanced pricing analysis. See generally AR Tabs 98-102.

        In reaching its conclusion that no unbalanced pricing existed in any of the proposals, the
Navy first considered where the greatest risk of unbalanced pricing in proposals would be based
on the fixed-price nature of the contract and determined the most likely risk to be offerors front-
loading their proposals. AR Tab 98 at 15082-86. To analyze this, the Navy compared each
offeror’s prices offered for work in the base period to the offeror’s price for the option years. Id.
at 15083. While there were differences that drew its attention, the Navy recognized that these
differences were explained by the Request for Proposal (“RFP”). Specifically, the RFP allowed
offerors to include transition costs into the base period price, which resulted in higher prices for
VJFS in its base period as compared to its option periods. Id. at 15085. The Navy also
compared offerors to each other for every performance period and examined each balance of
prices between Recurring Work and Non-Recurring Work. Id. The Navy concluded that none of
the offers were unbalanced because the offerors did not over or understate their Recurring Work
or Non-Recurring Work pricing. Id.

         On February 23, 2021, IAP filed its Supplemental Brief Regarding Unbalanced Pricing
(“Pltf.’s Suppl. Br.”). ECF No. 67. On March 9, 2021, the Government filed its Response to
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Plaintiff’s Supplemental Brief Regarding Unbalanced Pricing (“Def.’s Suppl. Resp.”), ECF No.
68, and VJFS filed its Response to Plaintiff’s Supplemental Brief Regarding Unbalanced Pricing
(“Int.’s Suppl. Resp.”), ECF No. 69. An extensive oral argument was heard on March 12, 2021,
and the remaining issue concerning unbalanced pricing is ripe for review.

II.    DISCUSSION

        The question for the Court is whether the Navy’s analysis is “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) (citing 28 U.S.C. § 1491(b)(4)’s adoption of the standard of 5 U.S.C. § 706). In other
words, the Court’s role here is not to test whether there is a better, faster, or otherwise “more
correct” way to analyze unbalanced pricing; rather, it is the Court’s task to determine whether the
Navy’s unbalanced pricing analysis is reasonable and its conclusions rational. “If the [C]ourt
finds a reasonable basis for [an] agency’s action, the [C]ourt should stay its hand even though it
might, as an original proposition, have reached a different conclusion as to the proper
administration and application of the procurement regulations.” Perspecta Enter. Sols. LLC v.
United States, 151 Fed. Cl. 772, 780 (2020) (quoting Honeywell, Inc. v. United States, 870 F.2d
644, 648 (Fed. Cir. 1989)) (alterations in original).

       A.      The Navy reasonably considered the risks of unbalanced pricing and tailored
       its analysis appropriately.

        Under the FAR, “[a]ll offers with separately priced line items or subline items shall be
analyzed to determine if the prices are unbalanced.” 48 C.F.R. § 15.404-1(g)(2). The FAR
provides that “[u]nbalanced pricing exists when, despite an acceptable total evaluated price, the
price of one or more line items is significantly over or understated as indicated by the application
of cost or price analysis techniques.” Id. § 15.404-1(g)(1); see also Survival Sys., USA, Inc. v.
United States, 102 Fed. Cl. 255, 271 (2011) (finding that the FAR “expressly contemplates the
evaluation of unbalanced pricing ‘by the application of cost or price analysis techniques.’”)
(quoting 48 C.F.R. § 15.404-1(g)(1)).

         To begin its analysis, the Navy looked at two aspects of the procurement to identify
where the greatest risk of unbalanced pricing would be. First, the Navy considered the structure
of its solicitation. In the prior opinion, the Court pointed to an apparent distinction the Navy
itself made between the Recurring Work and Non-Recurring Work Contract Line Item Numbers
(“CLINs”); the Navy described the Recurring Work as “fixed-price” and the Non-Recurring
Work as “operat[ing] in an [Indefinite Delivery, Indefinite Quantity (“IDIQ”)] manner, with
orders being placed at established rates for certain work items on an as-needed basis.” IAP, 2021
WL 451002, at *17-18 (quoting AR Tab 80 at 13542). In response to this portion of the prior
decision, the Navy first clarified that “this is a fixed-price procurement in all respects.” AR Tab
98 at 15083. As the Navy explained, because the Non-Recurring Work has a not-to-exceed
amount for each ordering period, it too operates as a fixed-price contract. Id. The Navy also
assessed unbalanced pricing at the CLIN-level because the respective ELIN “variances are
already captured through the use of the estimated quantities and fixed-price nature of the Non-
Recurring Work.” Id. Plaintiff does not challenge either determination.
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       Second, the Navy considered the specific work that may be performed (if ordered) under
the Non-Recurring Work CLINs to evaluate any respective risk of unbalanced pricing. Here, the
Navy concluded that:

               In order to engage in any sort of gamesmanship within Non-
               Recurring Work items (i.e., structure an offer in a manner in which
               [the offeror] is able to reap the benefit of a lower overall price
               during the evaluation stage, while primarily receiving orders of its
               “overpriced” items, rather than its “underpriced” items, during
               administration), an offeror would need to be able to anticipate
               which work items the Government will require, and which it will
               not, across each period of performance. Such foresight is difficult
               to realistically envision, as the Government’s needs will be
               determined by events that have not yet occurred (e.g., when certain
               systems fail, when Acts of God occur, changes in
               law/regulation/policy, etc.).

AR Tab 98 at 15083. This conclusion is reasonable given the nature of the work that comprises
the Non-Recurring Work. For example, the Non-Recurring Work includes prices to “provide all
labor, materials and equipment required to repair and test failed 1 Inch backflow preventer . . . .”
AR Tab 97 at 14872. Similarly, if the failed equipment cannot be repaired, there is pricing to
“provide all labor, materials and equipment required to replace and test failed 1 Inch backflow
preventer, after repair attempt . . . .” Id. at 14874. Predicting when or if such equipment will fail
would appear unlikely. There are similar line items for numerous different types of equipment
that may or may not fail during any option period. Other work includes pricing for painting that
may or may not be ordered, services for special events, and replacement of underground water
pipes. See generally id. at 14869-88. The common trait among these work items is that they are
unpredictable in any meaningful way.

        Based on its analysis of its procurement, the Navy determined that the risks of
unbalanced pricing would be (1) front-loading of proposals and (2) overallocation to the
Recurring (i.e., guaranteed) Work and under allocation to the Non-Recurring (i.e., not
guaranteed) Work. AR Tab 98 at 15083. In the Navy’s terms, its analysis “focuses on ensuring
each offer’s pricing is reasonably balanced across the base and all option periods, as well as
between Recurring and Non-Recurring Work CLINs.” Id. Therefore, the Navy performed
several calculations to determine whether these types of unbalance were present in any of the
proposals. Because IAP challenges both conclusions on slightly different grounds, each will be
addressed in turn.

               1.      The Navy’s analysis regarding the risk of front-loading proposals was
               rational.

        To analyze front-loading, the Navy calculated: (i) the difference between the base and
last option Recurring Work CLINs; (ii) the difference between the base and last option Non-
Recurring Work CLINs; (iii) the annual variances between the Recurring Work CLINs; and (iv)
the annual variances between the Non-Recurring Work CLINs. AR Tab 98 at 15083-84 &
                                                4
15088. This analysis caused some pause for the Navy regarding VJFS’s proposal because its
Recurring Work CLIN price decreased [ … ]% from the base to the first option period and
decreased [ … ]% from the base to last option period. Id. at 15084-85. While these differences
“appear significant,” the Navy concluded that they were explained by the fact that the RFP
specifically allowed offerors to include all phase-in and phase-out costs in the base period
Recurring Work CLIN. Id. The Navy concluded that none of the proposals was unbalanced
based on front-loading.

        IAP challenges the Navy’s analysis comparing the base period and option periods
because, according to IAP, “[n]either the FAR nor precedent supports the Navy’s assertion that
unbalanced pricing may be assessed by looking only within a given proposal.” Pltf.’s Suppl. Br.
at 6 (emphasis in original). The Navy appears to have brought this dispute on itself when it
stated that “[b]y the terms of the FAR, this [unbalanced pricing] analysis is conducted within
each offer, rather than by a comparison of separate offers. . . . Comparison of offers to one
another and to the [Independent Government Estimate (“IGE”)] was performed in the context of
determining price reasonableness and competitiveness . . . .” AR Tab 98 at 15082-83 (emphasis
in original). Both IAP’s and the Navy’s assertions are wrong.

        The Navy does not explain what in the FAR it believes compels the unbalanced pricing
analysis to be limited to looking within a proposal and there is no basis for this blanket
conclusion in the Court’s precedent. Indeed, in many cases the Government has identified
unbalanced pricing by comparing offerors’ proposals to each other and/or an independent
government estimate. E.g., Green Tech. Grp., LLC v. United States, 147 Fed. Cl. 231, 241
(2020) (CLINs compared against the Independent Government Cost Estimate (IGCE));
Harmonia Holdings Grp., LLC v. United States, 136 Fed. Cl. 298, 308 (2018) (same); XPO
Logistics Worldwide Gov’t Servs., LLC v. United States, 133 Fed. Cl. 162, 182 (2017), aff’d, 713
F. App’x 1009 (Fed. Cir. 2018) (unit prices and subline item (SLIN) prices compared between
three offerors and unit price comparisons used “to create a standard deviation against which each
price could be measured and assessed”); Acad. Facilities Mgmt. v. United States, 87 Fed. Cl.
441, 454 (2009) (line item and subline item prices compared against the IGCE). But none of
these cases require the use of any technique to analyze for unbalanced pricing and the question
for the Court is not whether the FAR mandated the Navy perform the analysis that it did, but
whether the Navy’s analysis was rational and permissible under the FAR. See Perspecta, 151
Fed. Cl. at 784 (quoting Tyler Constr. Grp. v. United States, 570 F.3d 1329, 1333 (Fed. Cir.
2009)) (“[W]hen assessing the agency’s selected evaluation procedures, the ‘proper inquiry’ is
‘whether there is any statutory or regulatory provision that precludes such use.’”) (alteration in
original). It was.

        IAP’s assertion that there is no precedent supporting an unbalanced pricing analysis of
base versus option periods—i.e., “within a proposal”—is incorrect. In at least two cases, this
Court has specifically endorsed the analysis the Navy performed here. In Munilla Construction
Management, LLC v. United States, 130 Fed. Cl. 635 (2017), the Court recognized that “[i]n
option-period solicitations, the unbalanced bid offers relatively high prices for the base period
and relatively low prices for the later option periods.” Id. at 650 (quoting Daniel I. Gordon,
Unbalanced Bids, 24 Pub. Cont. L.J. 1, 2 (1994)). Thus, the Munilla Court concluded that “[a]n

                                                5
unbalanced offer in this context is one that proposes relatively high prices for the base period but
relatively low prices for the later option periods . . . .” Id. (citing Gordon, 24 Pub. Cont. L.J. at
3-5 and Ralph C. Nash & John Cibinic, Unbalanced Bids and Proposals: Trying to Beat the
System, 5 No. 4 Nash & Cibinic Rep. ¶ 21 (1991)). In fact, the Munilla Court expressly
approved an unbalanced pricing analysis that consisted of comparing the prices of the base
period and each option period. Id. at 651. Similarly, in Survival Systems, USA, Inc. v. United
States, 102 Fed. Cl. 255 (2011), the Court found that the Government’s unbalanced pricing
analysis for a fixed-price contract was reasonable when the Government compared offerors’
mobilization and base year prices to their option year services. Id. at 271-72.

        Nor does the FAR require that the Navy do more than it did here. IAP’s argument here is
that the FAR requires the Navy to compare offers to each other, not just prices within each offer.
See Pltf.’s Suppl. Br. at 3, 6. The Government and VJFS, however, argue that the FAR places no
such requirement on the Navy because the FAR does not specify what techniques must be used
to analyze proposals for unbalanced pricing. The language of the FAR itself resolves this
dispute. The FAR provides that “[i]f cost or price analysis techniques indicate that an offer is
unbalanced, the contracting officer shall . . . .” 48 C.F.R. § 15.404-1(g)(2) (emphasis added).
The FAR defines price analysis to be “the process of examining and evaluating a proposed price
without evaluating its separate cost elements and proposed profit.” Id. § 15.404-1(b)(1). The
Navy’s approach certainly qualifies as a “price analysis” under this definition.

        The FAR also includes exemplars of price analysis techniques. 48 C.F.R.
§ 15.404-1(b)(2). According to Plaintiff, because “[n]early all the FAR’s identified . . . price
analysis techniques involve comparisons of an offeror’s proposed prices to information outside
of the offeror’s proposal,” the Navy had to do so as well. Pltf.’s Suppl. Br. at 7 (emphasis in
original). Plaintiff’s argument fails for several reasons. First, as a matter of logic, if “nearly all”
of the FAR’s price analysis techniques involve comparing one offer to another, there necessarily
are other techniques that do not, which undermines Plaintiff’s argument here. Second, the FAR
provides a non-exhaustive list of exemplar price analysis techniques, none of which is
mandatory. On this point, the FAR could not be any clearer: “The Government may use various
price analysis techniques and procedures to ensure a fair and reasonable price. Examples of such
techniques include, but are not limited to, the following . . . .” 48 C.F.R. § 15.404-1(b)(2)
(emphasis added). There is nothing in the FAR that requires the Navy to conduct an analysis of
each offeror’s CLIN pricing for Recurring and Non-Recurring Work in each ordering period.

       Finally, as explained in more detail in the next section, the Navy did compare each
proposal’s allocation of price between Recurring and Non-Recurring Work CLINs to the IGE for
each ordering period. Therefore, as a factual matter, the Navy’s analysis did not look exclusively
within each proposal.

               2.    The Navy’s analysis of the balance between Recurring and Non-Recurring
               Work was rational.

       To assess the second identified risk of unbalanced pricing—the allocation between
Recurring and Non-Recurring Work—the Navy examined the allocation of price for each
ordering period. To do this, the Navy calculated the percentage of the total price (the sum of
                                                 6
Recurring and Non-Recurring CLINs) allocated to the Recurring and Non-Recurring CLINs for
each ordering period. AR Tab 98 at 15085. While both IAP and VJFS allocated a [ … ]
percentage of price to the Non-Recurring Work than the IGE anticipated, the Navy determined
that the difference was minor and did not indicate any unbalance. Id. The Navy also considered
whether the ratio between Recurring and Non-Recurring CLINs changed significantly in any
proposal and found the proposals to be consistent from one period to the next. 2

        IAP argues that the Navy’s analysis was insufficient because “at no point did the Navy
compare the offerors’ actual CLIN prices against one another or the [IGE], or recognize that
[VJFS] had simultaneously proposed the lowest Recurring Work prices yet the highest Non-
Recurring Work prices.” Pltf.’s Suppl. Br. at 6 (emphasis in original). 3 To the extent IAP argues
that the Navy’s decision to compare proposals to the IGE using ratios rather than actual dollar
amounts is improper, that argument fails to find support in this Court’s precedent. See, e.g., Al
Ghanim Combined Grp. Co. Gen. Trad. & Cont. W.L.L. v. United States, 56 Fed. Cl. 502, 515-16
(2003) (“Although plaintiff and defendant focus much of their arguments regarding pricing on
whether [awardee’s] proposal evidenced unbalanced pricing, the court declines to speculate on
what the analysis would have revealed. The omission is a price analysis; the court finds that the
Corps did not evaluate the ratio between the CLINs.”) (emphasis added); Ultimate Concrete,
LLC v. United States, 127 Fed. Cl. 77, 83 (2016) (finding unbalanced pricing when evaluating
percentages (i.e., ratios) for the awardee’s original bid, in which a CLIN accounted for
approximately two percent of the contract’s overall value based on the IGE and for “42.6% of
the overall value” in the awardee’s bid). There is nothing in the FAR that mandates a
comparison of raw dollar values as opposed to comparing ratios so long as those ratios target the
potential for unbalanced pricing. Indeed, IAP itself argues at length about the percentage
differences between its proposal and VJFS’s. E.g., Pltf.’s Suppl. Br. at 3 (“That [ … ]%
difference was [ … ] the 9.24% difference between IAP’s and [VJFS’s] total evaluated prices,
which the Navy itself considered to be a ‘large range.’”) (emphasis in original).

2
  The one exception was that VJFS allocated a greater percentage to the Recurring Work CLIN
for the base period as compared to the option periods. As explained above, this was because
VJFS permissibly included all its phase-in and phase-out costs in that CLIN. See also AR Tab
98 at 15085.
3
  The scheme IAP argues is counterintuitive because it asserts that VJFS is underbidding the
work most likely to be awarded and overbidding the work that is least likely to be awarded. This
is the opposite of the typical unbalanced pricing scheme in which the offeror overbids the most
likely work and underbids the less likely work with the hope that the less likely work is never
ordered, which generates a windfall for the offeror. C.f. Moffett, Hodgkins & Clarke Co. v. City
of Rochester, 178 U.S. 373, 381-82 (1900) (recognizing “an unbalanced bid” as one “in which
the contractor will give a low price for one kind of work or materials in the same contract with
the hope that the quantity of work and materials for which a low price is bid will be reduced,
while the quality of materials or work for which a high price is bid will be increased, thus
making up on the high price bid sufficient to give the contractor a large profit upon the whole
work.”) (internal quotation marks omitted).
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        Nor was the Navy required to perform the calculations that IAP puts forth in its
supplemental brief. As noted above, the Navy compared each proposal’s pricing for Recurring
and Non-Recurring Work to the IGE for each ordering period. See AR Tab 98 at 15085. This
type of analysis is, in fact, one of the exemplar price analysis techniques included in the FAR.
48 C.F.R. § 15.404-1(b)(2)(v). While the Navy recognized that both VJFS and IAP allocated
more of the total price in each ordering period to the Non-Recurring Work than the IGE
anticipated, it determined that the variance was “minor and not significant enough” to show a
lack of balance. AR Tab 98 at 15085. There is nothing irrational about that conclusion. IAP,
however, argues that the Navy should have compared prices by comparing VJFS’s prices (in
dollars) to the average of the non-VJFS prices. Pltf.’s Suppl. Br. at 4. 4 Here too, such an
analysis was permitted by the FAR, but not required. Because this analysis was not required, the
Navy’s choice to compare proposals to the IGE rather than to each other was not arbitrary or
capricious.

       B.     The Navy was not required to consider performance risk in the first step of
       the unbalanced pricing analysis.

        IAP appears to argue that within the first step of the unbalanced pricing analysis,
addressing whether unbalanced pricing exists, the Navy should preemptively evaluate
performance risk and unreasonably high prices. See Pltf.’s Suppl. Br. at 5, 8-10. But under 48
C.F.R. § 15.404-1(g)(2), there is a two-step analysis: “All offers with separately priced line items
or subline items shall be analyzed to determine if the prices are unbalanced. If cost or price
analysis techniques indicate that an offer is unbalanced, the contracting officer shall – (i)
Consider the risks to the Government associated with the unbalanced pricing . . . .” (emphasis
added). Here, because the Navy rationally determined that there was no unbalanced pricing,
there was no basis to get to the second step of the analysis and consider the risks to the
Government.

        IAP’s reliance on both Green Technology Group, LLC v. United States, 147 Fed. Cl. 231
(2020) and Harmonia Holdings Group, LLC v. United States, 136 Fed. Cl. 298 (2018), is
misplaced. See Pltf.’s Suppl. Br. at 9. Neither case provides support for IAP’s position because
they are premised upon the existence of unbalanced pricing, which triggers the second step of the
FAR analysis. Green Tech., 147 Fed. Cl. at 241 (noting that the agency “admitted” to

4
  It is not clear that this analysis would have identified any proposal as “significantly” over or
understating prices, as required by the FAR. See 48 C.F.R. § 15.404-1(g)(1). IAP’s chosen
methodology does show that VJFS’s prices for Recurring Work were lower than the non-VJFS
average prices and VJFS’s prices for Non-Recurring Work were higher than the non-VJFS
average prices. That said, if the same analysis is done on IAP’s proposal, it shows the same
thing—that IAP’s prices for Recurring Work were lower than the non-IAP average prices and
IAP’s prices for Non-Recurring Work were higher than the non-IAP average prices. See Def.’s
Suppl. Resp. at 18. This does not mean that these proposals are unbalanced and does not
undermine the Navy’s conclusion that the variances from VJFS’s and IAP’s allocation of cost to
the Non-Recurring Work from what the IGE anticipated were not significant enough to find their
proposals unbalanced. AR Tab 98 at 15085-86.
                                                 8
unbalanced pricing when comparing two offers); Harmonia Holdings, 136 Fed. Cl. at 308
(observing that the protester “concede[d]” to unbalanced pricing). Here, the second step of the
unbalanced pricing analysis was not triggered because no unbalanced pricing was identified,
meaning that there was no basis for the Navy to conduct the risk analyses that IAP calls for.

       C.      The Navy did not ignore an important aspect of the problem.

        IAP’s final argument is that the Navy’s analysis was arbitrary and capricious because it
“entirely failed to consider an important aspect of the problem . . . .” Pltf.’s Suppl. Br. at 10
(quoting Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29,
43 (1983)). According to IAP, “it is highly curious” that the Navy did not address the concerns
that IAP raised regarding VJFS’s CLIN pricing in its prior briefing. Id. This argument is
without merit. The Navy was not required to conduct the analysis IAP proposes. But the Navy
did address the concern that IAP raised, albeit indirectly, when it determined that this
procurement is fixed-price in all respects. As explained above, that conclusion, which IAP does
not challenge, has been held to obviate the need for an analysis of unbalanced pricing within a
given option period. In other words, the Navy did not ignore IAP’s concerns about CLIN
pricing; it found the premise underlying them flawed.

        And the Navy did consider the specific concerns that the Court raised in the prior
opinion—i.e., the potential unbalanced pricing risk that the structure of the Non-Recurring Work
as an IDIQ (i.e., a requirements contract) could pose. Specifically, the Court was concerned that
“within each period of performance, there could certainly be a risk associated with unbalanced
pricing—i.e., some tasks being overpriced while others are underpriced. Neither the Record nor
the Government in this litigation explain why there was no consideration of unbalanced pricing
within the Non-Recurring Work within each period of performance.” IAP, 2021 WL 451002, at
*18. During remand, the Navy addressed this issue and explained that the fixed-price nature of
the procurement, coupled with the highly unpredictable nature of the Non-Recurring Work,
mitigates this risk. See supra Sec. II.A. Because Plaintiff neither challenges the Navy’s
conclusion nor points to any alleged unbalanced pricing “within the Non-Recurring Work” in
any performance period, the Court sees no need to question the Navy’s explanation here.

III.   CONCLUSION

        In the prior decision, the Court granted Judgment on the Administrative Record for some,
but not all, of the counts contained in the Complaint. Because the Court did not “expressly
determine[] that there [was] no just reason for delay,” Rule of the Court of Federal Claims 54(b),
final judgments were not entered with regard to Counts I-IV. For the reasons stated above, the
Court grants Judgment on the Administrative Record to the Government and VJFS with regard to
Count V, which means that the Court has now granted judgment as to the entire Complaint.
Therefore:

       1) Plaintiff’s Motion for Judgment on the Administrative Record is DENIED.

       2) The Government and Defendant-Intervenor’s Cross-Motions for Judgment on the
          Administrative Record are GRANTED.
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3) The Clerk is directed to enter judgment accordingly.

IT IS SO ORDERED.

                                                   s/ Edward H. Meyers
                                                   Edward H. Meyers
                                                   Judge

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