Campbell v. Schmidt ( 2020 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
JOCELYN DIONNE CAMPBELL,
Plaintiff,
v. Case No. 1:20-cv-1785 (CRC)
WILLIAM S. SCHMIDT, in his official
capacity as the Suspension and Debarment
Official, Suspension & Debarment Division of
the U.S. General Services Administration, et
al.,
Defendants.
MEMORANDUM OPINION
Plaintiff Jocelyn Campbell was debarred—that is, banned from contracting with the
federal government—by the U.S. General Services Administration (“GSA”), and therefore lost
her management job at a hospice that accepts federal reimbursement. Ms. Campbell sued GSA
and two of its officials, claiming that her debarment violated the Administrative Procedure Act
(“APA”). She moved for a preliminary injunction lifting her debarment during this litigation.
The record before the Court does not justify a preliminary injunction. Campbell has not
demonstrated that she will likely succeed in proving that her debarment was unlawful in any
respect. Nor has she carried her heavy burden to show that she faces irreparable harm in the
absence of preliminary relief. On the contrary, a preliminary injunction would disserve the
public interest by undermining the government’s ability to debar contractors who have been duly
found to lack responsibility to conduct business with federal agencies. The Court will therefore
deny the preliminary injunction motion.
I. Background
A. The Debarment Process
The Federal Acquisition Regulation (“FAR”) requires federal agencies to contract only
with “responsible contractors.” 48 C.F.R. § 9.402(a). “[T]o protect the Government’s interest”
in avoiding irresponsible contractors, an agency may debar a contractor after following
debarment procedures that comply with the FAR. Id. § 9.402(b). Debarment must be used “only
in the public interest . . . and not for purposes of punishment.” Id. The FAR advises agencies
that a contractor’s debarment generally should last three years or less. Id. § 9.406-4(a)(1).
Before debarring a contractor, the government must send the contractor a notice, which
must state the reasons for the proposed debarment and offer the contractor an opportunity to
respond within 30 days. Id. § 9.406-3(c). If the contractor’s response raises disputes as to
material facts, the government must provide an opportunity for a trial-like hearing and prepare
written findings of fact before deciding whether to debar the contractor. Id. § 9.406-3(b)(2),
(d)(2)(i). If no material disputed facts are raised, the debarring official simply considers the
whole administrative record and decides based on the preponderance of the evidence (or, if
applicable, a conviction or civil judgment that warrants debarment). Id. § 9.406-3(d)(1), (3).
After being debarred, a contractor may ask the agency to terminate the debarment early. The
agency has discretion to grant such post-debarment relief for “reasons the debarring official
deems appropriate.” Id. § 9.406-4(c)(5).
GSA has established procedures for debarring contractors within its purview, which
covers a broad range of federal acquisitions including construction contracts. See id. §
509.401(a). The Suspension and Debarment Official (“SDO”) of GSA—currently defendant
William Schmidt—is responsible for providing notice of proposed debarments and conducting
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debarment proceedings in keeping with the FAR. Id. §§ 509.403, 509.406-3. Once debarred by
GSA, a contractor generally may not bid on contracts with any part of the executive branch until
the debarment is lifted. Id. § 9.406-1(c).
B. Facts
The following facts are drawn from the record before the Court and are undisputed for
purposes of the present preliminary injunction motion. Campbell formed a small business called
T3 Resources, Inc. (“T3”) in 2003. First Campbell Decl. ¶ 2, ECF No. 3-3. T3 initially focused
on construction projects for churches. Id. T3 was eventually certified under Section 8(a) of the
Small Business Act, 15 U.S.C. § 637(a), which seeks to promote contracting between the federal
government and disadvantaged small businesses. First Campbell Decl. ¶ 2. In 2006, T3 entered
a formal mentoring relationship, becoming a protégé of Motir Services, Inc. (“Motir”), an
established 8(a) business owned by Emmanuel Irono. Id. ¶¶ 3, 6. The Small Business
Administration approved that mentor/protégé relationship. Id. ¶ 3. T3 then began contracting
with the federal government, in addition to commercial and municipal clients. Id. ¶ 4. T3’s
business operations ended in 2011. Id. ¶ 5.
Campbell subsequently moved to Nigeria, where she conducted business with the
Nigerian government through an entity she owned. Pachter Email (Sept. 2, 2020) at 1, ECF No.
15-2. While living abroad, Campbell used a temporary mailing address in Lithonia, Georgia.
First Campbell Decl. ¶ 9.
In 2015, while Campbell was in Nigeria, the FBI contacted her to request an interview as
part of an investigation it was conducting into Motir and Mr. Irono. Id. ¶ 6. About two months
later, Campbell moved to Birmingham, Alabama, where she would live with her mother until
2017. Id. ¶ 7. Campbell participated in the requested interview at the FBI’s Birmingham office
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in May 2015. Id. According to Campbell, the FBI was aware of the Birmingham address where
she was living at the time. Id.In 2017, Campbell began working as an administrator at Homestead Hospice in Jackson,
Georgia. Pachter Decl. Ex. C at JC0007 ¶ 3, ECF No. 3-2. She says she was successful in that
job and found personal satisfaction in it. Id. at JC0007 ¶¶ 3-4. In August 2019, while working at
Homestead, Campbell incorporated a new company, The Lighthouse Community Hospice, Inc.
Second Campbell Decl. ¶ 3, ECF No. 18.
On September 11, 2019, GSA issued a Notice of Proposed Debarment (“Proposal”) as to
Campbell. Proposal, ECF No. 12-3. According to the Proposal, the FBI’s investigation revealed
that Motir, T3, and a third company, Dimensional Solutions, Inc. (“DSI”), improperly
coordinated government-contract bids without informing the government that they were
affiliated. See Proposal 5, 8, 10. The Proposal states that in her FBI interview, Campbell
admitted that in connection with DSI’s effort to become an 8(a) certified business, she created
fake contracts between DSI and other entities, dating to before DSI existed. Id. at 10. Campbell
also reportedly admitted to the FBI that she told a colleague to create T3 resumes for Motir
employees so T3 could appear to have a larger staff when bidding on government contracts. Id.
at 9.
GSA sent the Proposal to the Lithonia, Georgia address that Campbell had used while in
Nigeria. First Campbell Decl. ¶ 9. Neither Campbell nor her family lived at the Lithonia address
at the time, so she did not receive the Proposal. Id. The Proposal was returned to GSA as
unclaimed. Unclaimed Mail Notice, ECF No. 12-5.
On December 18, 2019, GSA sent a final Notice of Debarment to the Lithonia address.
Debarment Notice, ECF No. 12-4. The Debarment Notice, signed by then-acting SDO Schmidt,
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refers to the Proposal and acknowledges that GSA received notice that the Proposal was
unclaimed. Id. It then states: “After careful consideration of the information contained in the
record in this matter, I have determined that cause for your debarment exists pursuant to Federal
Acquisition Regulation (FAR) 9.406-2(c) and that the Government’s interest requires your
debarment.” Id. Campbell was accordingly debarred for a three-year term. Id. As with the
Proposal, Campbell did not receive the Debarment Notice. First Campbell Decl. ¶ 12.
Later in December 2019, Campbell learned that she had been debarred after Homestead
discovered the debarment in a routine check of the government’s online System for Award
Management. Homestead told Campbell that she would be terminated unless the debarment was
lifted by March 1, 2020. Id.On January 6, 2020, Campbell’s then attorney Edward Arnold spoke by telephone with
GSA Integrity Officer Dylan Mooney. Mr. Arnold then emailed Mr. Mooney: “I will be
representing Jocelyn Campbell, who I understand has been debarred. We intend to prepare and
submit a response to the debarment in an expeditious manner.” Arnold Emails at 3, ECF No. 12-
6. On January 21, Arnold again spoke with Mooney. According to GSA’s later account of the
January 21 call, “Arnold requested a delayed response deadline to provide [Campbell] the
opportunity to submit information and argument specifying why [she] should be allowed to
contract with the Federal Government. . . . Mooney granted Arnold’s request for a delayed
response.” Continuation Notice, ECF No. 12-12.
Campbell subsequently retained a new attorney, John Pachter. On January 31, Mr.
Pachter sent a letter to GSA requesting relief from Campbell’s debarment. Pachter Letter (Jan.
31, 2020), ECF No. 12-7. In a declaration attached to this letter, Campbell responded to the
Proposal’s “insinuations of wrongdoing in T3’s relationship with Motir.” Pachter Decl. Ex. C at
5
JC0008 ¶ 9. Campbell admitted that she helped DSI gain its 8(a) certification—specifically, she
“downloaded contract forms from the web and entered information” she received from DSI
founder Anthony Ray. Id. But she disputed the language the Proposal used to characterize this
conduct: “I did not ‘create’ a ‘fake contract between DSI and [a third party]’ nor did I ‘fabricate’
another contract between DSI and Motir.” Id. Campbell further stated that “[t]he subcontracting
relationship between Motir and T3 was not a secret,” that the approved mentor/protégé
relationship allowed Motir and T3 to share employees, and that such sharing “was the norm” in
the field. Id. She also described her success as a hospice administrator, affirmed her
commitment to integrity, and reported receiving a perfect score on a recent ethics test. Id. at
JC0007-08 ¶¶ 3-4, 10-11.
In early March, Homestead fired Campbell because her debarment was still in place.
Pachter Email (March 2, 2020), ECF No. 12-10. The next day, Campbell personally emailed
Mooney to ask for relief, explaining that the debarment had caused her emotional and financial
distress. Campbell Email, ECF No. 12-11.
According to Campbell, she filed “approximately 10-12” applications for other jobs with
hospices and other medical providers, but all failed. Second Campbell Decl. ¶ 5. She then
“decided to focus [her] efforts on developing Lighthouse but providing hospice services at no
charge and without receiving a salary, hoping the debarment would be lifted and [she] would
then be able to operate Lighthouse as a going concern.” Id. ¶ 6. Lighthouse is now serving
patients but—because of Campbell’s debarment, in her telling—has not sought or received any
payment from Medicare, Medicaid, private insurers, or patients. Id. ¶ 8. Instead, Campbell
attests that she has funded Lighthouse by liquidating her 401k, withdrawing her savings,
borrowing from friends and family, and successfully applying for two federal loans totaling
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$40,000. Id. ¶¶ 9-12. Campbell represents that Lighthouse will shut down if the debarment
stays in place. Id. ¶ 13.
Unfortunately for Campbell, her plan to jump-start Lighthouse’s revenue by getting her
debarment lifted has not panned out so far. On April 13, 2020, GSA sent Campbell a Notice of
Continuation of Debarment. Continuation Notice, ECF No. 12-12. The Continuation Notice
states that, “[a]fter careful review of the administrative record and [Campbell’s] submissions,”
SDO Schmidt determined that her request did not meet the conditions for post-debarment relief
under 48 C.F.R. § 9.406-4(c). Id. The notice provides no further reasoning to support this
conclusion.
Pachter asked GSA to reconsider the Continuation Notice, taking issue with Schmidt’s
framing of Campbell’s request as an application for post-debarment relief under § 9.406-4(c).
According to Pachter, “Mr. Arnold understood from his conversations with Mr. Mooney that Ms.
Campbell’s delayed submission would be treated as a response to the proposed debarment,”
meaning it would be afforded the pre-debarment process set forth in § 9.406-3. Pachter Letter
(Apr. 18, 2020) at 1, ECF No. 12-13. Pachter also conveyed that Campbell was willing to enter
an administrative compliance agreement excluding her from federal contracting, if GSA would
then lift the debarment. Id. at 2. He noted that GSA had entered such agreements with Motir,
Irono, and other participants in the same alleged conspiracy. Id. at 1.
Schmidt denied the request for reconsideration. Schmidt Email (Apr. 22, 2020), ECF No.
12-14. He disputed the contention that Mooney had agreed to treat Cambell’s submission as if it
were filed as a pre-debarment response to the Proposal, but he stated that the procedural framing
made no difference because he “evaluated her submission with the same consideration as if she
had submitted a timely response to her proposed debarment.” Id. Schmidt found that
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submission “insufficient to establish Ms. Campbell’s present responsibility” but did not elaborate
on his reasoning. Id. After further correspondence, GSA reiterated its conclusion yet again, still
without substantive written analysis. Schmidt Letter (May 27, 2020), ECF No. 12-16.
C. Proceedings in this Case
Campbell filed this action in June 2020, asking the Court to set aside the debarment under
the APA. Compl. 31. Shortly thereafter, she filed the present Motion for Preliminary Injunction,
seeking an order temporarily enjoining enforcement of the debarment and requiring the
government to remove her name from its online list of excluded contractors. Mot. for Prelim.
Injunction 1. Campbell’s Complaint, her memorandum in support of her preliminary injunction
motion, and the supporting exhibits contained no indication that Campbell had founded
Lighthouse and was managing the new hospice without pay. On the contrary, Campbell
represented—without qualification, and under penalty of perjury—that she was “ineligible to
work in the field of hospice care.” First Campbell Decl. ¶ 20.
The government filed an opposition to the motion, and Campbell filed a reply, still
making no mention of Lighthouse. The Court then held a hearing on the motion in August 2020.
At the conclusion of the hearing, the Court urged GSA to consider whether it wished to explore a
potential administrative agreement resolving Campbell’s debarment, and directed the
government to then file a notice indicating whether the Court should proceed to rule on the
preliminary injunction motion. Hearing Tr. 47-48; see also Minute Order (Aug. 28, 2020).
A week later, the government informed the Court that it had “identified information
suggesting that Plaintiff may be currently working in the hospice field and, moreover, serving as
an officer of a company that is receiving federal funds.” Defs.’ Notice 1-2, ECF No. 15.
Campbell then filed a supplemental declaration, disclosing her involvement in Lighthouse and
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confirming that the new hospice had received two federal loans, but stating that the loan
applications did not ask about debarment. Second Campbell Decl. ¶¶ 3-11. The government
responded by asking the Court to proceed with the preliminary injunction motion and arguing
that the record, including Campbell’s supplemental declaration, failed to show that she was
suffering irreparable injury. Defs.’ Notice, ECF No. 17; Defs.’ Response to Pl.’s Suppl. Decl.,
ECF No. 19. Campbell submitted a reply addressing her irreparable-harm argument. She also
attached another supplemental declaration, retracting her previous representation that the federal
loan applications she submitted for Lighthouse did not ask about debarment. Third Campbell
Decl. ¶ 2, ECF No. 21-1.
The preliminary injunction motion is now ripe for decision.
II. Legal Standards
A. Motion for Preliminary Injunction
“A preliminary injunction is an extraordinary remedy that should be granted only when
the party seeking the relief, by a clear showing, carries the burden of persuasion.” Cobell v.
Norton, 391 F.3d 251, 258 (D.C. Cir. 2004). To obtain a preliminary injunction, the moving
party must show: (1) that she is likely to succeed on the merits of his claim; (2) that she is likely
to suffer irreparable harm in the absence of preliminary relief; (3) that the balance of equities tips
in her favor; and (4) that a preliminary injunction is in the public interest. Winter v. Nat. Res.
Def. Council, 555 U.S. 7, 20 (2008). An absence of irreparable injury is fatal to a preliminary
injunction motion. Chaplaincy of Full Gospel Churches v. England, 454 F.3d 290, 297 (D.C.
Cir. 2006). The D.C. Circuit has suggested, without holding, that failure to establish a likelihood
of success on the merits also categorically forecloses preliminary relief. Sherley v. Sebelius, 644
F.3d 388, 393 (D.C. Cir. 2011).
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B. Judicial Review of Debarment
An agency’s decision to debar a contractor is subject to review under “the traditional
‘arbitrary and capricious’ standard set forth in the APA.” Kisser v. Cisneros, 14 F.3d 615, 618
(D.C. Cir. 1994). Generally, this standard is “highly deferential” to the agency and turns on an
assessment of “whether the agency has articulated a rational connection between the facts found
and the choice made.” Id. at 618-19 (internal quotation marks omitted). Thus, when a debarred
contractor attacks the substantive reasoning the agency gave for a debarment, the court will
uphold the debarment unless “the agency’s decision is not supported by substantial evidence, or
the agency has made a clear error in judgment.” Id. at 619. Similarly, if the agency makes a
fact-specific determination that the circumstances in a debarment proceeding do not trigger a
particular procedural requirement, judicial review of that determination is deferential. See
Waterhouse v. United States, 874 F. Supp. 5, 9 (D.D.C. 1994) (reviewing for abuse of discretion
agency’s determination that there was no genuine issue of material fact and thus no need for a
formal evidentiary hearing).
Judicial review becomes less deferential when the dispute concerns legal questions about
the meaning of the FAR’s procedural provisions. See Friedler v. GSA, 271 F. Supp. 3d 40, 52-
53 (D.D.C. 2017) (“[O]nly minimal deference is due to GSA’s interpretation of the FAR when a
court undertakes to determine whether the agency followed that regulation’s procedural
requirements prior to imposing a debarment.”); Caiola v. Carrol, 851 F.2d 395, 399 (D.C. Cir.
1988) (noting that several agencies together promulgated the FAR, which “weaken[s] the case
for deference” to any single agency’s interpretation of the FAR). A legal error that deprives the
contractor of procedures required by the FAR may render the debarment “arbitrary and
capricious as a matter of law.” Friedler, 271 F. Supp. 3d at 53.
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III. Analysis
A. Likelihood of Success on the Merits
Campbell argues that she is likely to succeed on the merits because her debarment suffers
from seven separate defects. The Court will separately address each of these theories of error.
After careful consideration, the Court is not persuaded that any of Campbell’s arguments is
likely to carry the day. Taken as a whole, the record before the Court tends to show that GSA
properly debarred Campbell, then acted within its discretion to deny post-debarment relief.
Campbell therefore is not likely to succeed on the merits.
1. Was the Proposal procedurally improper because it was sent to the wrong
address and not received?
Campbell first argues that GSA failed to satisfy the FAR’s procedural notice
requirements. Pl.’s Mem. 20-22; Reply 14-15, ECF No. 13. Specifically, Campbell claims that
(1) GSA failed to send the Proposal to her last known address and (2) because she did not receive
the mailing, she was not provided the opportunity to respond that the FAR contemplates. Reply
14-15. The Court disagrees on both counts.
First, Campbell fails to show that GSA acted improperly by mailing the Proposal to her
former Lithonia, Georgia address in the first instance. A GSA regulation requires the agency to
send a notice of proposed debarment “by certified mail, return receipt requested, to the last
known address of a party, its counsel, or agent for service of process.” 48 C.F.R. § 509.403.
GSA asserts that it complied with this regulation by sending the Proposal to the Lithonia address,
which was Campbell’s most recent address known to GSA. Opp. 14-15. Campbell offers no
evidence that anyone at GSA had actual knowledge of a more recent address, but states that she
informed the FBI of her then-current Birmingham address in 2015. First Campbell Decl. ¶ 7.
She argues that because GSA knew that the FBI had interviewed her in Birmingham, GSA
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should have exercised “[a] higher level of diligence” to determine whether she had a more recent
Birmingham address before sending the Proposal to Lithonia. Pl.’s Mem. 21.
This argument is unpersuasive. Without evidence that the Birmingham address was
actually known to GSA, the Court cannot impute that knowledge from the FBI to GSA. “[T]he
U.S. Government is not a monolith, and notice to one agency of the Government . . . is not notice
to another government agency.” Estate of Clarke v. Comm’r, 54 T.C. 1149, 1169 (1970); see
also Luhring v. Glotzbach, 304 F.2d 556, 559 (4th Cir. 1962) (IRS agents in Virginia properly
sent notice to taxpayers’ last address known to them, although IRS agents in Florida knew of a
more recent address); DiViaio v. Comm’r, 539 F.2d 231, 235 n.11 (D.C. Cir. 1976)
(distinguishing Luhring but agreeing that the relevant IRS office there “had no notice and did not
know of any change in address”). No statute or regulation requires GSA to engage in inter-
agency consultation—with all the attendant administrative burdens and delays—to confirm a
contractor’s last known address when sending a notice of proposed debarment. Arguably, once
the Proposal was returned to GSA as unclaimed, the better policy might have been for the agency
to conduct a limited search for a more recent address. But the Court does not sit in judgment of
GSA’s policy choices. Regardless of whether it should have done more, GSA likely complied
with its “last known address” regulation as written.
Second, Campbell’s argument that she did not receive the Proposal also fails to establish
that the debarment was procedurally invalid. The FAR requires that a notice of proposed
debarment inform the contractor “[t]hat within 30 days after receipt of the notice, the contractor
may submit, in person, in writing, or through a representative, information and argument in
opposition to the proposed debarment[.]” 48 C.F.R. § 9.406-3(c)(4) (emphasis added). While
GSA sends notices of proposed debarment by certified mail, return receipt requested, see 48
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C.F.R. § 509.403, it also recognizes that situations may arise where GSA does not promptly
receive a return receipt and therefore cannot be certain whether the contractor received the letter.
GSA’s regulation therefore provides that “[i]f no return receipt is received within 10 calendar
days of mailing, receipt will then be presumed.” Id. This regulation, together with the FAR,
means that GSA generally may consider a debarment uncontested if it receives no return receipt
and hears nothing from the contractor within 40 days of mailing the proposal.
Campbell does not challenge the validity of this GSA regulation. 1 Instead she argues, in
effect, that the presumption of receipt was rebutted here because the Proposal was returned
unclaimed, so GSA must have known it was not received. Hearing Tr. 8-9; Reply 15. In
evaluating this argument, the Court may not substitute its judgment for GSA’s, but must
determine whether GSA abused its discretion by failing to conclude that the unclaimed mail
overcame the presumption of receipt. See Waterhouse, 874 F. Supp. at 9.
Campbell does not meet this high standard. The problem with Campbell’s argument is
that an unclaimed mail notice does not conclusively prove that the Proposal was not received.
Rather, the fact that certified mail was returned as unclaimed “leav[es] unsettled whether the
addressee refused to accept the certified letter[,] just happened to be out when delivery was
attempted,” or had moved to a new address. Derezinski v. Mukasey, 516 F.3d 619, 621 (7th Cir.
1
Although Campbell does not raise the point, the Court has considered whether GSA’s
adoption of this ten-day presumption is inconsistent with 48 C.F.R. § 9.406-3(c)(4). It is not.
Section 9.406-3(c)(4) provides that “receipt” of the notice of proposed debarment starts that 30-
day clock for the contractor’s response. Section 509.403 addresses a different question: how to
determine, without conclusive evidence, when (or whether) receipt occurred. Of course, the ten-
day presumption may sometimes cause GSA to conclude incorrectly that a proposal was
received—but that is simply how evidentiary presumptions work. By the same token, the
presumption of innocence in criminal cases may cause some guilty defendants to be acquitted,
but that does not make it inconsistent with the underlying penal law.
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2008). 2 A contractor who willfully refused to accept certified mail from GSA would surely have
“received” the mail within the meaning of the FAR. Cf. Derezinski, 516 F.3d at 620 (physical
receipt of mail and evasion of delivery “would amount to the same thing”). Yet, certified mail
sent to such a contractor would likely be returned as unclaimed. If GSA were compelled to
conclude that every piece of mail returned as unclaimed was never received by the addressee,
then any contractor hoping to avoid debarment would have a strong incentive to evade delivery
of GSA’s letters and thus avoid starting the 30-day clock for a response in opposition to
debarment. The Court therefore cannot say that it was impermissible for GSA to apply the
presumption of receipt to the Proposal—even though it now appears that Campbell did not evade
delivery of the Proposal but genuinely did not receive it. First Campbell Decl. ¶ 10.
All told, it appears on the present record that GSA complied with its procedural
obligations in providing notice of Campbell’s proposed debarment. Therefore, it likely was
procedurally proper for GSA to finalize the debarment after waiting more than 40 days from the
mailing of the Proposal.
2. Did the text of the Proposal fail to provide adequate notice of the basis for the
proposed debarment?
In addition to her procedural objections to the Proposal, Campbell mounts substantive
ones. She claims that the Proposal provides inadequate notice of the reasons for the proposed
debarment because only two pages of the twelve-page Proposal describe Campbell’s own alleged
2
Campbell cites Riley & Ephriam Construction Co., Inc. v. United States, 408 F.3d 1369(Fed. Cir. 2005) in support of her argument that GSA failed to provide 30 days from receipt of
the Proposal to respond. Reply 15. In Riley & Ephriam, the government moved for summary
judgment and bore the burden to prove that a notice was received by a certain date. 408 F.3d at
1372. The government failed to carry that burden because it had no proof of receipt. Id. at 1374.
Here, by contrast, Campbell bears the burden to prove that the Proposal was not received, and
that GSA abused its discretion by failing to so conclude.
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conduct, while eight describe the conduct of other parties. Pl.’s Mem. 22-23. She also contends
that the Proposal fails to explain why her own alleged conduct was “of so serious or compelling
a nature that it affects [her] present responsibility.” Id. at 23-24 (quoting 48 C.F.R. § 9.406-
2(c)).
These arguments are weak. The FAR requires a notice of proposed debarment to advise
the contractor of “the reasons for the proposed debarment in terms sufficient to put the contractor
on notice of the conduct or transaction(s) upon which it is based.” 48 C.F.R. § 9.406-3(c)(2).
The Proposal does precisely that. It alleges that in her FBI interview, Campbell admitted to,
inter alia, creating fake contracts to supply DSI with the necessary “experience” to qualify for
8(a) certification and directing a colleague to create T3 resumes for Motir employees so that T3
would appear larger to the government. Proposal 9-10. These are consequential allegations. It
hardly requires elaboration why these actions, if proven and not counterbalanced by mitigating
circumstances, could reasonably be considered “so serious” as to affect Campbell’s “present
responsibility” to contract with the government. 48 C.F.R. § 9.406-2(c).
That the description of Campbell’s alleged wrongdoing is contained within a longer
factual narrative is irrelevant. The Proposal’s recitation of the alleged actions of Irono, Motir,
and others does not detract from the clarity of its allegations against Campbell. On the contrary,
the background information is helpful to a reader’s understanding of Campbell’s alleged
misconduct.
Campbell therefore is not likely to succeed on her claim that the text of the Proposal
provides inadequate notice of the grounds for her proposed debarment.
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3. Did the Debarment Notice fail to specify the reasons for debarment or
determine that the cause for debarment was established by a preponderance
of the evidence?
Next, Campbell argues that the Debarment Notice failed to articulate a “reasoned
determination,” clarify whether GSA was imputing others’ conduct to her, and explain why the
cause for debarment was supported by a preponderance of the evidence. Pl.’s Mem. 25-27.
These arguments are not likely to succeed, given the substantial deference the Court owes GSA.
A final debarment notice must “[r]efer[] to the notice of proposed debarment” and
“[s]pecify[] the reasons for debarment.” 48 C.F.R. § 9.406-3(e)(1). The debarment must also be
based on a preponderance of the evidence. 48 C.F.R. § 9.406-3(d)(3). Review of whether a
debarment satisfies these requirements is “highly deferential.” Kisser, 14 F.3d at 618. “Even if
the [d]ecision was ‘of less than ideal clarity,’ the court must nonetheless uphold it ‘if the
agency’s path may reasonably be discerned.’” Burke v. EPA, 127 F. Supp. 2d 235, 242 (D.D.C.
2001) (quoting Bowman Transp., Inc. v. Arkansas Best Freight Sys., Inc., 419 U.S. 281, 285
(1974)).
Here, the Debarment Notice refers to the Proposal, then states that “[a]fter careful
consideration of the information contained in the record in this matter,” GSA “determined that
cause for [Campbell’s] debarment exists pursuant to [48 C.F.R. §] 9.406-2(c) and that the
Government’s interest requires [her] debarment.” From this, it “may reasonably be discerned,”
Burke, 127 F. Supp. 2d at 242, that GSA debarred Campbell because the misconduct she
allegedly admitted to the FBI, as described in the Proposal, was “of so serious or compelling a
nature that it affects [her] present responsibility.” 48 C.F.R. § 9.406-2(c). Moreover, the Court
can discern that GSA did not reach this conclusion by imputing others’ conduct to Campbell. As
discussed above, the Proposal clearly uses background information about Campbell’s associates
to put her admissions in context, not to accuse her of guilt by association. This understanding of
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the Proposal carries over to the Debarment Notice, which refers to the Proposal and implicitly
incorporates its factual narrative.
As Campbell points out, the Debarment Notice does not explicitly rule out the possibility
that in addition to considering the information in the Proposal, GSA might have also considered
other, unspecified “information contained in the record.” Pl.’s Mem. 25. But this merely shows
that the Debarment Notice was “of less than ideal clarity,” not that it was arbitrary and
capricious. Burke, 127 F. Supp. 2d at 242. Importantly, any reasonable reader of the Debarment
Notice would understand that the information in the Proposal about Campbell’s alleged conduct
was at least one reason for GSA’s conclusion, if not the sole reason. Cf. Casino Airlines, Inc. v.
NTSB, 439 F.3d 715, 718 (D.C. Cir. 2006) (upholding agency decision where agency’s
“language could have been more direct,” but any “fair reading” would reveal that the agency
based its decision “at least in part” on a specific ground).
Campbell’s argument that the Debarment Notice fails to establish the cause for
debarment by a preponderance of the evidence fares no better. The Debarment Notice and the
Proposal indicate that GSA’s fact-finding analysis was straightforward; the agency simply
credited the information from Campbell’s FBI interview. There is no indication that GSA had
before it any countervailing evidence to weigh against the FBI interview at the time. Under
these circumstances, it would be an empty formality for GSA to recite the obvious conclusion
that its factual findings were supported by a preponderance of the evidence. Campbell cites no
authority that compels GSA to include these magic words in the Debarment Notice.
4. Did GSA fail to assess Campbell’s present responsibility and consider
mitigating factors?
Campbell also claims that her debarment is invalid because GSA failed to consider
mitigating factors and thus make an informed assessment of her present responsibility. Pl.’s
17
Mem. 31. She does not carry her burden to show a likelihood of success on this claim because,
on the record before the Court, it appears most likely that GSA no longer had an obligation to
analyze mitigating factors in writing by the time Campbell presented them to the agency.
A debarring official “act[s] in an arbitrary and capricious manner” if the debarment
decision “fail[s] to explain why he did not find the mitigating evidence presented by the
[contractor] persuasive.” Feinerman v. Bernardi, 558 F. Supp. 2d 36, 50 (D.D.C. 2008); see also
Robinson v. Cheney, 876 F.2d 152, 160 (D.C. Cir. 1989) (“Affording the contractor this
opportunity to overcome a blemished past assures that the agency will impose debarment only in
order to protect the Government’s proprietary interest and not for the purpose of punishment.”);
48 C.F.R. § 9.406-1(a) (listing potential mitigating factors that a debarring official “should
consider” before debarring a contractor).
However, none of Campbell’s authorities suggests that when a contractor submits
mitigating factors after being debarred, the agency still must analyze those factors in writing.
Rather, the FAR seems to contemplate that a request to terminate an already-issued debarment
based on mitigating factors is a matter within the debarring agency’s broad discretion. In
contrast to the FAR’s detailed pre-debarment procedural requirements, the regulation provides
merely that “[t]he debarring official may” grant an early termination of debarment based on
certain enumerated grounds. 48 C.F.R. § 9.406-4(c) (emphasis added). The FAR’s list of
potential reasons for post-debarment relief does not specifically mention mitigating factors, but
grants discretion to consider any “[o]ther reasons the debarring official deems appropriate.” Id.(emphasis added). In the absence of further guidance about when the debarring official should
“deem[]” post-debarment relief “appropriate,” this language suggests that the denial of a request
to terminate a debarment based on mitigating factors is either committed to the agency’s
18
unreviewable discretion or subject only to exceedingly narrow judicial review. Cf. Webster v.
Doe, 486 U.S. 592, 600 (1988) (statutory language authorizing CIA Director to terminate
employees whenever he “shall deem such termination necessary or advisable in the interests of
the United States” commits termination to unreviewable agency discretion and “exudes
deference to the Director”).
Therefore, before reaching the issue of whether GSA properly analyzed the mitigating
factors highlighted in Campbell’s January 2020 submission to the agency, the Court must
address the threshold question of what posture the proceeding was in when Campbell made that
submission. If Campbell’s submission was properly regarded as a request for post-debarment
relief under 48 C.F.R. § 9.406-4(c), then GSA had no apparent obligation to analyze it in any
detail. By contrast, if GSA agreed to treat the submission as a response to the Proposal under the
rules that normally apply before debarment, then GSA was obliged to analyze mitigating factors.
The parties dispute whether GSA agreed to treat the January 2020 submission like a pre-
debarment response, and there is some evidence to support both views. Campbell’s best
evidence is GSA’s statement in an April 2020 letter that it had “granted Arnold’s request for a
delayed response.” Continuation Notice, ECF No. 12-12. According to Campbell, the “delayed
response” referenced in this letter must be a delayed response to the Proposal, since there is no
deadline for a response to a final debarment. Pl.’s Mem. 29. On the other side, there is
evidence, spanning several months, that both Arnold and GSA understood Campbell to be
seeking post-debarment relief under 48 C.F.R. § 9.406-4(c). See Arnold Emails at 3, ECF No.
12-6 (“I will be representing Jocelyn Campbell, who I understand has been debarred. We intend
to prepare and submit a response to the debarment in an expeditious manner.” (emphases
added)); Schmidt Email (Apr. 22, 2020) (disputing the “assumption” that “Ms. Campbell’s
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delayed submission would be treated as a response to the proposed debarment”); Continuation
Notice (applying § 9.406-4(c) to deny relief from debarment). Moreover, GSA apparently did
not lift the debarment while it was considering Campbell’s submission, as might be expected if
the agency had intended to put Campbell back in the position of a proposed debarree.
After weighing this evidence, the Court is not persuaded that Campbell has carried her
burden to show that GSA agreed to treat the January 2020 submission like a pre-debarment
response and thus took on an obligation to analyze mitigating factors. The most plausible
inference is that GSA used the phrase “delayed response” loosely, without intending to waive
any specific filing deadline. The agency probably meant only to assure Arnold that it would
accept and review Campbell’s post-debarment request for § 9.406-4(c) relief.
Accordingly, Campbell is not likely to succeed in showing that GSA violated the APA by
failing to analyze the mitigating factors she presented in 2020, after she had been debarred. The
Court does not reach the question of whether Campbell would likely succeed on this claim if her
submission to GSA had been filed in a pre-debarment posture.
5. Did GSA violate the FAR by failing to hold a hearing and prepare written
findings of fact?
Relatedly, Campbell argues that the debarment was procedurally defective because GSA
failed to hold a formal hearing and make written findings of fact. This claim is unlikely to
succeed, for largely the same reasons as Campbell’s argument that GSA failed to analyze
mitigating factors.
As part of the pre-debarment procedure applicable to Campbell under the FAR, the
debarring agency must provide an opportunity for a trial-like hearing and prepare written
findings of fact “if it is found that the contractor’s submission in opposition raises a genuine
dispute over facts material to the proposed debarment.” 48 C.F.R. § 9.406-3(b)(2), (d)(2)(i).
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However, as discussed above, it is doubtful that the FAR’s pre-debarment procedures applied to
GSA’s consideration of Campbell’s January 2020 submission. That submission was more likely
a request for post-debarment relief, subject to GSA’s broad discretion. 3
Even if the FAR’s pre-debarment procedures did apply to Campbell’s 2020 submission,
she would not be likely to succeed on her claim that GSA improperly denied her a formal
hearing and written findings of fact. The Court owes substantial deference to GSA’s
determination that a formal hearing and written fact-finding were unnecessary. Waterhouse, 874
F. Supp. at 9. Campbell argues that her submission raised material factual disputes regarding (1)
T3’s relationship with Motir; (2) employee sharing between T3 and Motir; (3) “the limited
assistance Ms. Campbell provided to Mr. Ray” in getting DSI certified as an 8(a) contractor; and
(4) the alleged fake contracts. Pl.’s Mem. 30. However, on closer inspection, Campbell’s
submission does not substantively dispute any material factual statement in the Proposal, but
merely takes issue with GSA’s characterization of the alleged misconduct. For example, while
Campbell protests that she did not “create” any “fake contract[s],” Pachter Decl. Ex. C at JC0008
¶ 9, she admits that she entered information provided by Mr. Ray into online forms, and she does
not deny knowing that the information was false. Id. Here as in Waterhouse, “[t]he Court agrees
with the debarring official that the essential facts are undisputed and, more importantly, it
concludes that it was not an abuse of discretion for the debarring official to so conclude.” 874 F.
Supp. at 9.
3
Campbell argues that even before her January 2020 submission, the record before GSA
“contained ample evidence of genuine disputes of material fact.” Pl.’s Mem. 29. By this, she
seems to mean simply that the evidence was inconclusive as to certain issues. But GSA’s
obligation to hold a hearing and make written factual findings arises only if “the contractor’s
submission in opposition raises a genuine dispute over facts material to the proposed debarment.”
48 C.F.R. § 9.406-3(b)(2) (emphasis added).
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6. Did GSA unlawfully treat Campbell more harshly than others involved in the
same alleged scheme?
Campbell’s next argument is that GSA irrationally treated her more harshly than similarly
situated parties. Specifically, GSA entered an Administrative Compliance Agreement (ACA)
with several individuals and entities who were, in Campbell’s view, accused of “far more
serious” wrongdoing in connection with the same alleged scheme. Reply 18.
For this theory, Campbell relies on Caiola v. Carroll, 851 F.2d 395 (D.C. Cir. 1988). In
Caiola, the government debarred two corporate officials by imputing the conduct of their
employer to them, but in the same administrative decision, it declined to impute the corporation’s
acts to a third, identically situated respondent. 851 F.2d at 397-98. The D.C. Circuit rejected
this internally inconsistent logic. Id. at 400. However, the Circuit has since clarified that Caiola
does not authorize courts to compare one individual’s “completed” debarment against the
debarring agency’s “decision not to pursue enforcement against” similarly situated individuals.
Kisser, 14 F.3d at 620. Such judicial scrutiny would be improper because an agency’s decision
not to take debarment action falls within its unreviewable prosecutorial discretion. Id.Kisser forecloses Campbell’s attempt to analogize this case to Caiola. GSA’s decision to
settle its debarment action against Irono and Motir rather than pursue debarment was an exercise
of unreviewable prosecutorial discretion. See Baltimore Gas & Elec. Co. v. FERC, 252 F.3d
456, 461 (D.C. Cir. 2001). GSA therefore need not “demonstrate consistency in exercising its
discretion” to abandon debarment actions. Kisser, 14 F.3d at 619 n.5.
7. Was GSA’s decision improperly punitive?
Finally, Campbell claims that GSA improperly debarred her as a punitive measure, not to
protect the public interest. See 48 C.F.R. § 9.402(b) (debarment may not be used “for purposes
22
of punishment”). She argues that “the Government’s repeated and egregious failures to comply
with the FAR debarment regulations” reveal a punitive motive. Pl.’s Mem. 38.
The Court does not accept the premise that GSA committed “repeated and egregious”
errors. As discussed above, Campbell is not likely to succeed in showing that GSA violated any
regulation in debarring her. She therefore cannot bootstrap her critiques of the administrative
proceedings into a conclusion that GSA likely intended to punish her.
***
Accordingly, Campbell has not carried her burden to show a likelihood of success on the
merits. Although this failure likely forecloses preliminary relief, see Sherley, 644 F.3d at 393,
the Court will analyze the remaining preliminary injunction factors.
B. Irreparable Harm
The parties vigorously dispute whether Campbell has demonstrated irreparable harm in
the absence of preliminary relief. Informed by the full record, including the late revelation that
Campbell is currently managing a hospice, the Court finds that she has not met this requirement.
“[T]he degree of proof required for irreparable harm is high[.]” Olu-Cole v. E.L. Haynes
Pub. Charter Sch., 930 F.3d 519, 529 (D.C. Cir. 2019) (internal quotation marks omitted). “The
injury must be both certain and great; it must be actual and not theoretical and of such
imminence that there is a clear and present need for equitable relief.” Id. (cleaned up). The
injury in question must be one that the court could remedy by issuing a preliminary
injunction. See Hispanic Affairs Project v. Perez, 141 F. Supp. 3d 60, 69-70 (D.D.C. 2015);
Elec. Priv. Info. Ctr. v. Dep’t of Com., 356 F. Supp. 3d 85, 96 (D.D.C.), vacated on other
grounds, 928 F.3d 95 (D.C. Cir. 2019). Similarly, if the plaintiff has a duty to mitigate damages,
the Court will not find irreparable harm based on an economic injury the plaintiff could avoid.
23
See Lanvin Inc. v. Colonia, Inc., 739 F. Supp. 182, 192-93 (S.D.N.Y. 1990) (citing Am. Brands,
Inc. v. Playgirl, Inc., 498 F.2d 947, 949-50 (2d Cir. 1974)); Flood v. Kuhn, 309 F. Supp. 793,
800 (S.D.N.Y. 1970).
Campbell argues that she is suffering essentially three types of harm: (1) reputational
damage; (2) loss of ability to work in the hospice field, which gives her personal satisfaction; and
(3) loss of income. See Pl.’s Mem. 39; Reply 20-22. The Court will address each in turn.
First, nothing in the record shows that Campbell is suffering any particularized,
irreversible reputational injury. While debarment certainly can harm a contractor’s reputation,
see Gonzalez v. Freeman, 334 F.2d 570, 574 (D.C. Cir. 1964), the Court cannot conclude
without specific evidence that Campbell faces such harm. “[O]therwise, all debarred contractors
. . . would be able to show irreparable injury simply by being debarred.” Mobley v. Cheney,
CIV. A. No. 90–1580 SSH, 1990 WL 141750, at *1 n.2 (D.D.C. Sept. 20, 1990).
Second, Campbell’s supplemental declaration undermines her argument that her
debarment is denying her the personal fulfillment of working in the hospice field. As she now
admits, she is currently managing a new hospice, Lighthouse, on a volunteer basis. Second
Campbell Decl. ¶¶ 6-9. She contends that without a preliminary injunction, Lighthouse will need
to shut down because Campbell’s debarment prevents the hospice from billing Medicare and
Medicaid. Id. ¶ 13. However, Campbell has not met her high burden of proof to show that
Lighthouse’s collapse is imminent. She offers no evidence for this proposition except her own
declaration. A single declaration without specific financial figures is not particularly strong
evidence, especially when the declarant has not shown herself to be an entirely reliable narrator.
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Third, the Court cannot conclude that Campbell’s loss of income constitutes irreparable
harm because she has not shown that she cannot avoid this loss, nor has she shown that a
preliminary injunction would make a difference in her earnings.
As Campbell points out, the government is immune from damages for any violations of
the APA. See Lane v. Pena, 518 U.S. 187, 196 (1996). Although it is “well settled that
economic loss does not, in and of itself, constitute irreparable harm,” Wis. Gas Co. v. FERC, 758
F.2d 669, 674 (D.C. Cir. 1985), lost business revenue that will be unrecoverable due to sovereign
immunity can count as irreparable injury, particularly where there is evidence that the business
faces imminent collapse without preliminary relief. See Alcresta Therapeutics, Inc. v. Azar, 755
F. App’x 1, 5 (D.C. Cir. 2018). However, “the mere fact that economic losses may be
unrecoverable does not, in and of itself, compel a finding of irreparable harm.” Nat’l Mining
Ass’n v. Jackson, 768 F. Supp. 2d 34, 53 (D.D.C. 2011). Assuming Campbell is correct that she
faces unrecoverable economic losses, the Court still must consider whether other factors make
this injury an inappropriate basis on which to find irreparable harm.
As the D.C. Circuit has explained in the context of unfair labor practice disputes, a person
losing employment income “must make a reasonably diligent search for suitable [alternative]
employment” to mitigate the loss. NLRB v. Madison Courier, Inc., 505 F.2d 391, 395 (D.C. Cir.
1974); see also Conn v. Am. Nat’l Red Cross, 149 F. Supp. 3d 136, 152 (D.D.C. 2016) (Cooper,
J.) (applying same standard for job search in employment discrimination case).
Here, the record raises substantial doubts about the diligence of Campbell’s search for a
suitable new job to replace her income from Homestead. By her own account, Campbell applied
for ten to twelve jobs in the hospice and healthcare fields, over no more than a few months,
before abandoning the search to focus on her unpaid work at Lighthouse. Second Campbell
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Decl. ¶ 5. Her understanding is that “nearly all” hospice providers accept Medicare and
Medicaid patients and therefore cannot hire a debarred employee. Id. (emphasis added). This
evidence suggests that Campbell could have done far more to look for a suitable paying job,
either at one of the few hospices that could employ her or elsewhere in the healthcare industry. 4
Cf. Gentry v. E. W. Partnership Mgmt. Co. Inc., 816 F.3d 228, 241 (4th Cir. 2016) (upholding
finding that plaintiff’s year-long job search was insufficient).
Even assuming Campbell did satisfy her duty to mitigate damages, she fails to
demonstrate that the Court can redress her economic loss by issuing a preliminary injunction.
While Campbell’s debarment clearly makes her ineligible to work for some employers, including
Homestead, the record is silent on whether any of those employers would choose to hire her if
the Court were to order temporary relief from the debarment. Indeed, to the extent Campbell’s
debarment is a barrier to employment, it seems likely that employers would also be wary of
hiring an employee who is temporarily un-debarred and faces potential re-debarment. Similarly,
on the current record, the Court can only speculate as to whether Lighthouse would earn revenue
and enable Campbell to pay herself a salary if the debarment were lifted. This problem
undermines Campbell’s irreparable-harm argument. See Hispanic Affairs Project, 141 F. Supp.
3d at 69-70 (plaintiff failed to show irreparable injury because the requested preliminary
injunction would not guarantee him the type of job he was seeking); Flood, 309 F. Supp. at 800.
4
To the extent that mitigating her lost wages would require her to accept a non-hospice
job, Campbell might argue that she is being irreparably harmed because she must choose
between earning money and pursuing her passion for hospice work. However, the record does
not show that Campbell cannot do both—that is, volunteer in a hospice setting while earning
income in another subfield of healthcare. If anything, it tends to show that Campbell is capable
of multitasking. See Second Campbell Decl. ¶ 3 (Campbell incorporated Lighthouse while
employed at Homestead).
26
Campbell therefore has not made the required showing of irreparable harm.
C. Balance of the Equities and the Public Interest
Two preliminary injunction factors remain to consider: the balance of the equities and the
public interest. In a case against the government, these factors merge. See Pursuing Am.’s
Greatness v. FEC, 831 F.3d 500, 511 (D.C. Cir. 2016).
Some equitable factors support a preliminary injunction. Lifting Campbell’s debarment
would increase the probability of her being able to remain in the hospice field. Other things
being equal, it is in the public interest for capable professionals to pursue much-needed hospice
work. Moreover, although the process leading to Campbell’s debarment was likely lawful, it is
unfortunate that she did not receive the Proposal before being debarred. A preliminary
injunction could arguably serve an equitable interest in giving contractors a full opportunity to
respond to proposed debarments.
However, the equities weighing against a preliminary injunction are greater. The
government—and, by extension, the public—has a compelling interest in enforcing the
debarments of contractors who have properly been found presently irresponsible. See Caiola,
851 F.2d at 399 (“Debarment reduces the risk of harm to the system by eliminating the source of
the risk, that is, the unethical or incompetent contractor.”). That Campbell has no plans to bid on
federal acquisition contracts does not mean that the government has no reason to debar her.
Managers of healthcare providers that accept Medicare and Medicaid patients occupy a position
of public trust, given their ability to bill the government for services. Debarring irresponsible
individuals may help protect the public against waste, fraud, and abuse by preventing those
individuals from working as managers at federally funded healthcare facilities. While the Court
reaches no conclusion on whether Campbell is presently irresponsible, the record suggests that
27
she may have engaged in serious past misconduct, and her inconsistent candor to the Court so far
does not engender confidence in her present responsibility.
Overall, the balance of the equities and the public interest weigh against issuing a
preliminary injunction.
IV. Conclusion
For the foregoing reasons, the Court will deny Plaintiff’s Motion for Preliminary
Injunction. A separate Order shall accompany this memorandum opinion.
CHRISTOPHER R. COOPER
United States District Judge
Date: November 3, 2020
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