Court Opinion

ID: 4459086
Source: CourtListenerOpinion
Date Created: 2019-11-26 17:01:48.480562+00
Date Added: 2024-06-11T14:52:27.377256
License: Public Domain

In the United States Court of Federal Claims
                              No. 19-1060C
                  (Originally Filed: November 18, 2019)
                    (Re-issued: November 26, 2019) 1

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ARKHAM TECHNOLOGY LTD.,                     Bid protest; Rule 59(e);
                                            Motion to alter or amend
                    Plaintiff,              judgment; Declaratory relief;
                                            Bid preparation costs; Relief
v.                                          sought after judgment; Case
                                            or controversy requirement;
THE UNITED STATES,                          Vain act.
                    Defendant.

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      Aaron P. Silberman, San Francisco, CA, with whom were Stephen L.
Bacon and Eleanor Ross, for plaintiff.

       Steven M. Mager, Senior Trial Counsel, United States Department of
Justice, Commercial Litigation Branch, Washington, DC, with whom were
Joseph H. Hunt, Assistant Attorney General, Robert E. Kirschman, Jr.,
Director, Douglas K. Mickle, Assistant Director, for defendant. Lawrence
M. Anderson and Bruce A. Hinchey, Department of the Air Force, of counsel.

                                  ORDER

BRUGGINK, Judge.

      Plaintiff filed its complaint on July 23, 2019, challenging the Air
Force’s award of a contract for the development of a cryptography device to
a Federally Funded Research and Development Center (“FFRDC”) rather
than opening competition to private industry, including plaintiff. Plaintiff

1
  Due to the protective order in this case, this order was originally held to
allow the parties to propose redactions of protected material. The parties
agreed that no redactions were necessary. The order thus appears as in the
original.
alleged a violation of several statutes and Federal Acquisition Regulation
provisions. A preliminary injunction was unnecessary because the Air Force
agreed not to move forward with the work until after October 7, 2019. We
thus set a schedule to conclude with oral argument on October 4, 2019.
Despite motion practice concerning supplementation of the record, that
schedule was kept, and argument was held on October 4. At the conclusion
of oral argument, the court announced that it would not grant plaintiff relief
because the harm to the United States caused by delay inherent in any relief
ordered by the court was too grave and because the public interest in
preventing any such harm was overwhelming. 2 We noted further that even
the risk of that harm occurring would prevent an injunction. 3 Because it was
unnecessary to do so, we did not reach the issue of whether plaintiff would
have succeeded on any of its arguments on the merits.

       Due to the classified nature of much of the material discussed and the
harms alleged by the government, we announced our intent during oral
argument to enter judgment without the issuance of a written opinion. We
asked the parties if they objected, and neither did. We thus issued an order
denying plaintiff’s motion for judgment on the administrative record and
granting defendant’s cross-motion shortly after oral argument. The Clerk of
Court entered judgment that same day. See ECF Nos. 44 & 45.

       Four days later, on October 8, 2019, plaintiff moved to alter or amend
judgment under rule 59(e), asking the court to reopen the judgment and to
reach its merits arguments as a request for declaratory relief. We set a
briefing schedule for that motion, and it is now fully briefed. Oral argument
is unnecessary.

        In its motion, plaintiff avers that it was surprised that judgment was
entered without the court reaching the merits of its legal arguments. It
explains that its lack of objection at the conclusion of oral argument indicated
only an assent to an interim bench ruling on the appropriateness of injunctive
relief and that it believed that “entry of final judgment would be deferred

2
 Because much of the record was classified, any transcript of the argument
would also be classified and thus unavailable for citation.

3
 Given the critical issue of time, we held a status conference a week prior
to oral argument to inform the parties that the court was unwilling to issue
an injunction given the harm to the government, and we asked the plaintiff
whether it wanted to proceed with oral argument. It elected to do so. The
transcript of that hearing is also classified and unavailable.
                                       2
pending the issuance of a final written opinion as to all of the claims that
Arkham has raised in this bid protest.” Pl.’s Mot. To Alter or Amend J. 2. It
points out that its complaint not only asked for injunctive relief but also for
declaratory relief. It argues that, were it to prevail on any of its declaratory
requests, it would be entitled to bid and proposal costs and possibly attorney
fees under the Equal Access to Justice Act (“EAJA”) as a small business.
See 28 U.S.C. § 2412 (2012). It further urges that the procurement
community would benefit from an opinion on the merits given the statutory
issues implicated.

        Defendant responds that there can be no further relief available to
plaintiff because declaratory relief in these circumstances, divorced from an
injunction, would be an academic exercise not tied to an active case or
controversy. Likewise, plaintiff did not request bid preparation costs nor
would any be available, argues defendant, because no solicitation was issued
or responded to in this case. Indeed, the Request For Information (“RFI”)
preceding the award specifically warned industry respondents that no costs
would be reimbursed. EAJA fees, according to the government, are also
unavailable because plaintiff cannot be the prevailing party in a case in which
it has not obtained meaningful judicial relief, and that the matter cannot be
reopened merely to declare whether plaintiff was correct on the underlying
legal arguments. For all of these reasons, no manifest injustice would be
avoided by altering the judgment, says defendant.

        Plaintiff argues that the court “routinely holds further proceedings on
plaintiff’s entitlement to bid preparation and proposal costs and EAJA fees
after the Court decides the parties’ motions for judgment on the
administrative record and plaintiff’s entitlement to injunctive relief.” Pl.’s
Reply 2. Plaintiff cites seven instances in which these proceedings have
taken place after the court has denied injunctive relief, several for national
security reasons, as here. E.g., Def. Tech., Inc. v. United States, 99 Fed. Cl.
103, 132 (2011); Gentex Corp. v. United States, 58 Fed. Cl. 634, 656 (2003).
Plaintiff further argues that bid preparation costs are sometimes available in
instances in which a solicitation is not ultimately issued and therefore the
issue ought to be considered by the court. Thus, in plaintiff’s view, the court
should reopen the case, decide plaintiff’s request for declaratory relief and
bid preparation costs and, if granted, decide the appropriateness of an award
of attorney fees under EAJA.

       We disagree. As defendant argues, there is no further relief available
to plaintiff because, in these circumstances, declaratory relief would be
illusory, or as defendant put it, “academic,” and because bid preparation costs
                                       3
are not available. A motion under Rule 59(e) is considered under the same
standards as one for reconsideration under the other subsections of Rule 59.
See Stockton E. Water Dist. v. United States, 76 Fed. Cl. 470, 472 (2007).
The court will not disturb its judgment unless the moving party shows an
intervening change in the law, new evidence not previously available, or that
a manifest injustice will result absent altering the judgment. Johnson v.
Untied States, 126 Fed. Cl. 558, 560 (2016). A Rule 59 motion is not an
opportunity to relitigate claims or to raise new arguments that should have
been made earlier. IAP Worldwide Servs., Inc. v. United States, 141 Fed. Cl.
788, 801 (2019).

        Although asked for in its complaint, bid preparation costs were not
raised by plaintiff in its motion for judgment on the administrative record.
Thus, defendant did not brief the issue of their availability, and the issue was
not joined prior to oral argument. Nor do the cases cited by plaintiff support
the notion that the issue of entitlement to bid costs is handled routinely after
the merits. In six of the seven cases cited by plaintiff, only the issue of
quantum of costs survived after the court’s decision on the merits and
entitlement to injunctive relief. 4 In Furniture By Thurston v. United States,
for example, the court found that the Marine Corps had awarded the contract
contrary to the solicitation but found an injunction unavailable due to the
balance of harms and the public interest. 130 Fed. Cl. 505, 521-22 (2012).
Because plaintiff had shown illegality in the procurement, however, the court
awarded bid preparation costs and directed plaintiff to prepare a summary of
its costs and the defendant to respond subsequently. Id. at 522.

       The same is true of the rest of the cases cited by plaintiff. See Defense
Tech., Inc., 99 Fed. Cl. at 132 (granting plaintiff’s request for bid costs,
denying injunctive relief, and ordering the parties to consult regarding the
quantum of costs); Ereh Phase I LLC v. United States, 95 Fed. Cl. 108, 124,
n.14 (2010) (Denying plaintiff’s motion for judgment, but finding an
entitlement to bid preparation costs because plaintiff was correct on the

4
  The lone exception is Naplesyacht.com, Inc. v. United States, in which
Judge Braden, relying on the request in the complaint, allowed the plaintiff
to move for bid costs after ruling on the motions for judgment on the
administrative record. 60 Fed. Cl. 459, 478 (2004). It is unclear why the
court required plaintiff to separately move for bid preparation costs given
that the court, although not awarding injunctive relief, found an error in the
procurement process. Like the other cases cited, however, the procurement
did involve a solicitation and bidding process, unlike here.
                                       4
merits, and construing plaintiff’s request for relief in its motion as including
bid preparation costs); Afghan Am. Army Servs. Corp. v. United States, 90
Fed. Cl. 341, 369 (2009) (although not enjoining the government, deferring
judgment pending the parties’ agreement on bid preparation costs); CSE
Constr. Co., Inc. v. United States, 58 Fed. Cl. 230, 236 (2003) (awarding bid
preparation costs despite not finding an injunction appropriate and requiring
the parties to file a stipulation as to bid costs); Gentex, 58 Fed. Cl. at 656
(finding the procurement too critical to delay, but awarding bid preparation
costs, which had been raised earlier by plaintiff in affidavits). Each of these
cited cases involved a solicitation and bidding process, unlike here.
Entitlement to bid costs, unlike here, was thus attendant to the protestor’s
merits challenge. Here, where the agency did not pursue a competition, no
bids were solicited, and RFI responders were warned that no solicitation was
promised nor would any compensation be forthcoming for costs associated
with responding to the RFI, entitlement to those costs as bid preparation costs
is an issue separate from the legality of the Air Force’s decision to procure
the work from an FFRDC. 5

       A post-judgment motion is not the procedurally appropriate time to
make a request for new relief. In the bid protest context, the protestor must
present all of its claims and bases for that relief in its motion on the
administrative record. See Voith Hydro, Inc. v. United States, 142 Fed. Cl.
233, 237 n.6, 238 n.7 (2019) (“When a party litigates a bid protest under an
expedited schedule, it cannot fail to argue the merits of its motion in its
opening brief”). Piecemeal litigation is disfavored and especially so in the
bid protest context where time is of the essence.

       With relief at law unavailable—because it was not sought prior to
judgment—and plaintiff’s claim for equitable relief already disposed of, the
court may not make a declaration of the parties’ legal rights in the abstract.
It would be a vain act and run afoul of the Constitution’s requirement that
court’s not act in the absence of an actual case or controversy. See Brookfield
Relocation Inc. v. United States, 113 Fed. Cl. 74, 78 (2013). There is no
active case or controversy “when the issues presented are no longer live or
the parties lack a legally cognizable interest in the outcome.” Already, LLC
v. Nike, Inc., 568 U.S. 85, 91 (2013) (quoting Murphy v. Hunt, 455 U.S. 478,
481 (1982)). Plaintiff does not have a legally cognizable interest in the

5
 Although not reaching the issue, we note that we would be unlikely to find
that bid preparation costs are available for the reasons listed above. We were
thus unsurprised to see the issue omitted from plaintiff’s motion papers.
                                       5
outcome because no relief is available that would alter the relationship
between the parties. The court has not, and will not, award a payment of
money or order a change in defendant’s decision to contract with the
FFRDC. 6 Thus, there is no injustice to be prevented by leaving the judgment
in place. Plaintiff’s motion to alter the judgment is denied.

                                           s/Eric G. Bruggink
                                           ERIC G. BRUGGINK
                                           Senior Judge

6
 Because there is no longer any relief available to plaintiff, EAJA fees will
not provide a basis for reopening the action either. Plaintiff cannot be, in any
sense of the phrase, a prevailing party, as required for a fee award under the
act, when the legal relationship between the parties will not be changed. See
Dellew Corp. v. United States, 855 F.3d 1375, 1379-80 (Fed. Cir. 2017).
                                       6