Case: 20-1498 Document: 39 Page: 1 Filed: 11/03/2020
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
LAX ELECTRONICS, INC., DBA AUTOMATIC
CONNECTOR,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
______________________
2020-1498
______________________
Appeal from the United States Court of Federal Claims
in No. 1:19-cv-01668-EGB, Senior Judge Eric G. Bruggink.
______________________
Decided: November 3, 2020
______________________
JUSTIN HUFFMAN, Camardo Law Firm, P.C., Auburn,
NY, for plaintiff-appellant.
RETA EMMA BEZAK, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, for defendant-appellee. Also represented by
JEFFREY B. CLARK, DEBORAH ANN BYNUM, ROBERT EDWARD
KIRSCHMAN, JR.
______________________
Case: 20-1498 Document: 39 Page: 2 Filed: 11/03/2020
2 LAX ELECTRONICS, INC. v. UNITED STATES
Before MOORE, O’MALLEY, and TARANTO, Circuit Judges.
TARANTO, Circuit Judge.
LAX Electronics, Inc., doing business as Automatic
Connector (Automatic), has long supplied electronic con-
nectors to federal-government contractors and directly to
the government. According to Automatic, for many years
it had parts listed on the Defense Logistics Agency’s (DLA)
Qualified Parts List (QPL), which designates government-
approved sources of supply, and it sold its QPL-listed prod-
ucts to contractors and the government in procurements
that required QPL listing of the manufacturer. In Septem-
ber 2019, DLA removed Automatic from the QPL for cer-
tain electronic connectors—specifically, parts MIL-PRF-
39012 and MIL-PRF-55339. Because of the removal, Auto-
matic is barred from responding to solicitations from De-
partment of Defense entities for those parts.
Automatic challenged its removal from the QPL by fil-
ing suit in the U.S. Court of Federal Claims (Claims Court),
invoking the court’s bid-protest jurisdiction under 28
U.S.C. § 1491(b)(1). Automatic’s amended complaint as-
serted two claims—one for injunctive relief under 5 U.S.C.
§ 706 for the government’s violation of Department of De-
fense Manual (DoDM) 4120.24 and one for declaratory re-
lief under 28 U.S.C. § 2201 for the government’s violation
of Federal Acquisition Regulation (FAR) § 9.205(a). The
government moved to dismiss the claims for lack of juris-
diction.
The Claims Court agreed in part. LAX Electronics, Inc.
v. United States, No. 19-1668C,
2019 WL 6880939 (Fed. Cl.
Dec. 17, 2019). As to the first claim, the court held that it
lacks bid-protest jurisdiction; but rather than dismiss the
claim, it transferred the claim to the U.S. District Court for
the Eastern District of New York under 28 U.S.C. § 1631.
Id. at *3–5. As to the second claim, the Claims Court held
that the claim is within the court’s bid-protest jurisdiction,
but it dismissed the claim for failure to state a claim on
Case: 20-1498 Document: 39 Page: 3 Filed: 11/03/2020
LAX ELECTRONICS, INC. v. UNITED STATES 3
which relief could be granted.
Id. at *4. We now vacate the
court’s jurisdictional dismissal of the first claim and re-
mand for further proceedings on that claim, and we affirm
the merits dismissal of the second claim.
I
A
In June 2019, DLA audited Automatic’s facility. LAX
Electronics,
2019 WL 6880939, at *1. The resulting audit
report identified several violations by Automatic of MIL-
STD-790, a standard issued by DLA related to electrical
and fiber-optic parts, required Automatic to take corrective
actions within 30 days, and noted that the corrections
would require DLA acceptance. DLA also sent Automatic
a letter on July 2, 2019, ordering Automatic to stop ship-
ment and production of specified connectors because of de-
ficiencies identified in the audit report. Automatic
responded to DLA’s auditor with its Corrective Action Re-
ports on August 6, 2019. See LAX Electronics,
2019 WL
6880939, at *1; J.A. 137–38, 512, 525–45.
Automatic’s amended complaint alleges that DLA
failed to respond to its Corrective Action Reports or other-
wise tell Automatic how to correct the deficiencies identi-
fied in the audit report. Rather, on August 13, 2019, the
amended complaint says, DLA sent a letter to Automatic
directing it to issue a notice to the Government-Industry
Data Exchange Program (GIDEP) for the parts discussed
in the audit report. Automatic responded to DLA two days
later by letter, stating that a GIDEP notice was not re-
quired and that Automatic’s parts were not deficient. See
LAX Electronics,
2019 WL 6880939, at *1; J.A. 512–13.
On September 12, 2019, DLA removed Automatic from
all QPLs associated with two particular connectors (MIL-
PRF-39012 and MIL-PRF-55339) because of repeated vio-
lations of applicable specifications and failure to issue a
GIDEP notice. DLA also sent a letter to Automatic on
Case: 20-1498 Document: 39 Page: 4 Filed: 11/03/2020
4 LAX ELECTRONICS, INC. v. UNITED STATES
October 9, 2019, informing Automatic of DLA’s intent to
issue a GIDEP notice to government and industry mem-
bers about Automatic’s noncompliance with and removal
from the QPL. See LAX Electronics,
2019 WL 6880939, at
*1; J.A. 547–48, 550.
Automatic’s amended complaint alleges that DLA con-
tinues to solicit bids for the parts Automatic cannot supply
given the removal from the QPL. “Almost on a continuous
basis,” the amended complaint states, “DLA is and has
been requesting quotes for connectors, and DLA has pro-
vided no meaningful opportunity for Automatic to partici-
pate in the process through a direct contract or a
subcontract with other vendors.” J.A. 509–10 ¶ 1. Further:
DLA is “barring Automatic from bidding on the continuing
stream of solicitations for the connectors” while “refusing
to provide Automatic with any sort of reasonable oppor-
tunity to arrange for qualification before award of various
contracts for the connectors.” J.A. 510 ¶ 2. Again: “Be-
cause the Government is in a nearly constant need for the
parts, DLA is and has been requesting quotes for the con-
nectors on a nearly continuous basis.” J.A. 514 ¶ 23. Au-
tomatic’s amended complaint identifies five solicitations
with closing dates from October 28 to November 14, 2019.
J.A. 515 ¶ 25; see also J.A. 132–34 (declaration, submitted
to support a temporary restraining order, enumerating nu-
merous solicitations with closing dates from July through
October 2019). The amended complaint declares: “Auto-
matic is a potential bidder for the numerous solicitations
for the connectors.” J.A. 515 ¶ 26.
B
Automatic sued in the Claims Court on October 28,
2019, invoking the court’s bid-protest jurisdiction under 28
U.S.C. § 1491(b)(1). In its complaint and its authorized
amended complaint, Automatic made two claims. First,
Automatic alleged that DLA removed its parts from the
QPL without following the procedures outlined in DoDM
Case: 20-1498 Document: 39 Page: 5 Filed: 11/03/2020
LAX ELECTRONICS, INC. v. UNITED STATES 5
4120.24, Enclosure 14, Sections 11–12. J.A. 515–19. Spe-
cifically, Automatic alleged a violation of section 12(b)(1),
which requires that the removed product “should again be
included on the electronic QPL . . . once the deficiencies
noted have been corrected to the government’s satisfac-
tion.” According to Automatic, DLA’s failure to respond to
Automatic’s Corrective Action Reports deprived Automatic
of an opportunity to correct any deficiencies. J.A. 518
¶¶ 35–36. Second, Automatic alleged that, after the re-
moval from the QPL, DLA failed to comply with FAR
§ 9.205(a), which states that “when possible, give sufficient
time to arrange for qualification before award.” 48 C.F.R.
§ 9.205(a). See J.A. 519–20.
The government moved to dismiss for lack of subject-
matter jurisdiction under § 1491(b). As relevant here, that
provision gives the Claims Court “jurisdiction to render
judgment on an action by an interested party objecting to
. . . any alleged violation of statute or regulation in connec-
tion with a procurement or a proposed procurement.” 28
U.S.C. § 1491(b). The government disputed that Auto-
matic was “an interested party” and also that Automatic
was objecting to a statutory or regulatory violation “in con-
nection with a procurement or a proposed procurement.”
J.A. 503–08.
With respect to Automatic’s first claim, alleging a vio-
lation of DoDM 4120.24, the Claims Court held that the
claim flunks the “in connection with” requirement of
§ 1491(b). LAX Electronics,
2019 WL 6880939, at *2–3.
The court likened Automatic’s case to Geiler/Schrudde &
Zimmerman v. United States, stating that “the possibility
that an agency action would affect future procurements did
not ‘establish that the violation “clearly affected” a con-
tract’s award or performance.’” LAX Electronics,
2019 WL
6880939, at *3 (quoting Geiler, 743 F. App’x 974, 977 (Fed.
Cir. 2018) (per curiam)). The court also stated that, alt-
hough Automatic identified specific solicitations that it
could not bid on after it was removed from the QPL,
Case: 20-1498 Document: 39 Page: 6 Filed: 11/03/2020
6 LAX ELECTRONICS, INC. v. UNITED STATES
Automatic’s removal from the QPL was the result of the
audit, which was not performed in connection with any of
the identified procurements.
Id. Determining for that rea-
son that Automatic’s first claim did not meet the “in con-
nection with” requirement of § 1491(b)(1), the Claims
Court held jurisdiction over that claim absent without ad-
dressing the “interested party” requirement of § 1491(b)(1).
As to Automatic’s second claim, alleging a violation of
FAR § 9.205(a), the Claims Court held that the claim is
within the court’s bid-protest jurisdiction, determining
that this allegation meets both the “interested party” and
“in connection with” requirements of § 1491(b)(1). LAX
Electronics,
2019 WL 6880939, at *3–4, *4 n.2. But the
court dismissed the second claim for failing to state a claim.
According to the court, § 9.205(a) applies only when an
agency decides to impose a “new qualification,” not when,
as with Automatic, a previously qualified bidder is ousted
from the QPL. LAX Electronics,
2019 WL 6880939, at *4.
Moreover, the court reasoned, Automatic’s position con-
flicts with FAR § 9.202(e), which states that “a contracting
officer need not delay a proposed award in order to provide
a potential offeror with an opportunity to demonstrate its
ability to meet the standards specified for qualification.”
Id. (internal citation marks omitted).
The Claims Court dismissed the second claim for fail-
ure to state a claim. The court did not dismiss the first
claim, even though it ruled that the claim is outside its ju-
risdiction. Rather, the court stated that the first claim “ap-
pears, on its face, to be subject to review as final agency
action” under the Administrative Procedure Act in district
court.
Id. at *5. Upon Automatic’s request, the Claims
Court transferred the first claim to the Eastern District of
New York under 28 U.S.C. § 1631.
The Claims Court entered judgment on December 17,
2019. Automatic timely appealed. We have jurisdiction
under 28 U.S.C. § 1295(a)(3).
Case: 20-1498 Document: 39 Page: 7 Filed: 11/03/2020
LAX ELECTRONICS, INC. v. UNITED STATES 7
II
We review the ruling on subject-matter jurisdiction de
novo. Resource Conservation Group, LLC v. United States,
597 F.3d 1238, 1242 (Fed. Cir. 2010). We also review de
novo the dismissal for failure to state a claim. American
Bankers Ass’n v. United States,
932 F.3d 1375, 1380 (Fed.
Cir. 2019). To avoid dismissal for failure to state a claim,
a plaintiff must allege facts that plausibly suggest entitle-
ment to relief under the law invoked. Bell Atl. Corp. v.
Twombly,
550 U.S. 544, 557 (2007). We accept as true the
complaint’s well-pleaded factual assertions, but we are not
required to accept the asserted legal conclusions. Ashcroft
v. Iqbal,
556 U.S. 662, 678 (2009).
A
The Claims Court held that it lacks subject-matter ju-
risdiction over Automatic’s first claim because Automatic’s
removal from the QPL was not “in connection with a pro-
curement or proposed procurement” under 28 U.S.C.
§ 1491(b)(1). We disagree.
We have long recognized that the phrase “in connection
with,” under § 1491(b)(1), is “very sweeping in scope.”
RAMCOR Services Group, Inc. v. United States,
185 F.3d
1286, 1289 (Fed. Cir. 1999). Likewise, the term “procure-
ment” is broad enough to cover “any stage of the federal
contracting acquisition process, including the process for
determining a need for property or services.” Distributed
Solutions, Inc. v. United States,
539 F.3d 1340, 1346 (Fed.
Cir. 2008) (internal quotation marks omitted). Any “non-
frivolous allegation of a statutory or regulatory violation in
connection with a procurement or proposed procurement is
sufficient to establish jurisdiction.”
Id. at 1345 n.1.
In its amended complaint, Automatic’s first claim al-
leges that DLA violated procedural requirements in DoDM
4120.24 for removing products from a QPL. The Claims
Court held jurisdiction over this claim to be lacking
Case: 20-1498 Document: 39 Page: 8 Filed: 11/03/2020
8 LAX ELECTRONICS, INC. v. UNITED STATES
because, it concluded, this alleged impropriety was not “in
connection” with a procurement or proposed procurement.
LAX Electronics,
2019 WL 6880939, at *3. The court relied
chiefly on our non-precedential decision in the Geiler case.
Id. After the Claims Court decided the present case, how-
ever, we decided Acetris Health, LLC v. United States,
949
F.3d 719 (Fed. Cir. 2020), which makes clear that Geiler is
narrower than the Claims Court thought and, indeed, that
bid-protest jurisdiction extends to Automatic’s first claim.
In Geiler, upon the death of Mr. Geiler, a veteran, the
government revoked the service-disabled veteran-owned
small business (SDVOSB) status of certain entities with
which Mr. Geiler was involved. As relevant here, those en-
tities challenged the revocation in the Claims Court, as-
serting constitutional and statutory violations and
invoking that court’s bid-protest jurisdiction. We affirmed
the Claims Court’s dismissal of that challenge for lack of
jurisdiction on the ground that the plaintiffs “failed to es-
tablish that those alleged violations occurred in connection
with a procurement or proposed procurement.” 743 F.
App’x at 976–77.
We explained that the plaintiffs had “not point[ed] to
any effect that the [government’s] status revocation deci-
sion had on the award or performance of any contract.”
Id.
at 977. We first noted that the revocation violations could
not be in connection with the one past contract award that
had initially been contested in the litigation, as the con-
tract was awarded pre-revocation and, of the three Geiler
entities at issue, two did not bid on that contract and the
one that bid did not appeal the Claims Court’s ruling that
upheld the award on its merits.
Id. The “in connection
with” inquiry, therefore, was limited in the case to poten-
tial future procurements. But, relying partly on case law
requiring a certain degree of specificity for a plaintiff to
meet the “interested party” requirement of § 1491(b)(1),
Geiler, 743 F. App’x at 977–78, we concluded that the “in
Case: 20-1498 Document: 39 Page: 9 Filed: 11/03/2020
LAX ELECTRONICS, INC. v. UNITED STATES 9
connection with” requirement was not met because the
plaintiffs did “not challenge a specific procurement, or even
allege that the Geiler Entities were preparing to bid for a
specific procurement that required an SDVOSB status,”
id.
at 978. We “decline[d] Geiler’s invitation to interpret
§ 1491(b)’s ‘in connection with a procurement or a proposed
procurement’ requirement as satisfied whenever a plaintiff
alleges a legal violation that might affect unidentified
pending or future procurements.”
Id.
In Acetris, we held that the Claims Court had jurisdic-
tion to hear a challenge to the government’s “definitive po-
sition” that would make the plaintiff ineligible to compete
for likely future government procurements for which it was
likely to submit bids. Ace
tris, 949 F.3d at 727–28; see also
Boeing Co. v. United States,
968 F.3d 1371, 1382 n.4 (Fed.
Cir. 2020). Acetris was objecting to the government’s de-
terminations of how to interpret statutory and regulatory
provisions concerning the country of origin of the product
and its ingredients and of how that interpretation applied
to Acetris, determinations that together excluded Acetris
from bidding on a non-speculative stream of future govern-
ment procurements of the very pharmaceutical products
Acetris had previously supplied to the government and
wished to continue supplying. Ace
tris, 949 F.3d at 727–28.
In concluding that the “in connection with” requirement
was met in that circumstance, we explained that Geiler was
materially different: “This is not a situation where, as in
Geiler[ ], the bid protester could not identify any future pro-
curements on which the protester intended to bid.”
Id. at
728 (emphasis added).
Automatic has alleged far more in its first claim than
the Geiler plaintiffs alleged. In fact, Automatic’s allega-
tions are akin to what was held sufficient in Acetris and
therefore call for the same result—that the “in connection
with” requirement is met. Automatic’s amended complaint
is fairly read as alleging that for many years Automatic
was selling its parts to DLA and that DLA regularly issued
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10 LAX ELECTRONICS, INC. v. UNITED STATES
procurements for these very parts and continued to do so
on a regular basis after Automatic’s connectors were re-
moved from the QPL. See J.A. 509–511, 514–15. These
allegations not only go well beyond the entirely generic
Geiler assertion that the revocation of SDVOSB status dis-
qualified the Geiler entities from “all pending and future
proposed procurements set aside” for businesses with that
status, with no further specificity. Geiler, 743 F. App’x at
977. The amended complaint’s allegations in this case are
comparable to the facts of Acetris and establish a continu-
ing series of future government procurements, since the
challenged removal from the QPL, of the specific products
Automatic was supplying before that removal and would
supply if restored to the QPL. Under Acetris, those facts
suffice for us to conclude that the violation alleged to have
infected the removal from the QPL was “in connection
with” those likely procurements.
The government seeks to distinguish this case from
Acetris on the ground that, in Acetris, the protestor chal-
lenged a “definitive” legal interpretation and its applica-
tion to disqualify the protestor, whereas, in this case,
Automatic has the ability to requalify for the QPL. Appel-
lee Supp. Br. 4–5. But even aside from whether the dis-
tinction is sound on the facts—Acetris itself seemingly
could have altered the sourcing of its products’ components
so as to requalify—the government’s distinction does not
affect whether the alleged violation is “in connection with”
procurements. As in Acetris, the government has taken a
“definitive position” disqualifying the plaintiff’s products
from certain sufficiently identified future procurements—
here, by removal of Automatic’s parts from the QPL. Ace-
tris, 949 F.3d at 727. Although the legal violation alleged
is different from the violation in Acetris, the violation al-
leged here has the same characteristic that was critical in
Acetris to finding the “in connection with” requirement
met: It resulted in a disqualification from likely future pro-
curements in which the plaintiff was likely to bid.
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LAX ELECTRONICS, INC. v. UNITED STATES 11
Because the Claims Court held that Automatic’s first
claim does not meet the “in connection with” requirement
of § 1491(b)(1), it did not decide (for the first claim) whether
Automatic meets the “interested party” requirement
(though it did decide that issue, favorably to Automatic, for
the second claim). We vacate the Claims Court’s jurisdic-
tional determination, and we remand for further proceed-
ings on this claim.
B
Automatic’s second claim is that DLA violated FAR
§ 9.205 after removing Automatic’s connectors from the
QPL. J.A. 519–20. Under FAR § 9.205, “[i]f an agency de-
termines that a qualification requirement is necessary,” it
must “when possible, give sufficient time to arrange for
qualification before award.” 48 C.F.R. § 9.205(a). The
Claims Court dismissed the claim for failure to state a
claim, reasoning that FAR § 9.205(a) applies only when an
agency imposes a “new qualification” and noting that FAR
§ 9.202(e) makes clear that an agency need not “delay” an
award to allow a potential bidder the opportunity to qual-
ify. LAX Electronics,
2019 WL 6880939, at *4.
We affirm the dismissal without endorsing the Claims
Court’s conclusion that § 9.205(a) is limited to a “new qual-
ification.” Neither the Claims Court’s opinion nor the gov-
ernment’s brief on appeal presents an analysis of precisely
what that limitation means, how it applies to QPL listing
or delisting, and how it fits with the overall regulatory
scheme of which § 9.205(a) is a part. We conclude, instead,
that the action challenged by Automatic is not a denial of
what Automatic itself says § 9.205(a) requires of the
agency. The action challenged in this claim is DLA’s fail-
ure to respond to Automatic’s Corrective Action Reports,
not a denial of time to qualify before any particular con-
tract award is made. J.A. 520 ¶¶ 47–50. But the regula-
tory subsection, in Automatic’s own view, merely
“requir[es] the Government to give the contractor sufficient
Case: 20-1498 Document: 39 Page: 12 Filed: 11/03/2020
12 LAX ELECTRONICS, INC. v. UNITED STATES
time to arrange for qualification before award.” Appellant
Opening Br. 20. Automatic’s complaint about DLA’s al-
leged refusal to engage Automatic on the merits of the Cor-
rective Action Reports does not allege denial of sufficient
time to qualify; indeed, Automatic states that “because the
Government refuses to even tell Automatic what is alleg-
edly deficient about its [Corrective Action Reports], any ef-
fort by Automatic to qualify or re-qualify for the QPL would
be futile.” Appellant Reply Br. 8. Because the facts alleged
by Automatic do not plausibly suggest a showing of entitle-
ment to relief based on a violation of § 9.205(a), we affirm
the dismissal of Automatic’s second claim.
III
The judgment of the Claims Court is affirmed in part
and vacated in part, and the matter is remanded to the
court for further proceedings.
The parties will bear their own costs.
AFFIRMED IN PART, VACATED IN PART, AND
REMANDED
