Coastal Environmental Group, Inc. v. United States , 114 Fed. Cl. 124 ( 2014 )

In the United States Court of Federal Claims
No. 13-71C
(Filed Under Seal: December 16, 2013)
(Reissued for Publication: January 6, 2014)*
*************************************
COASTAL ENVIRONMENTAL GROUP, *
INC., * Postaward Bid Protest; Cancellation of
* Procurement After Protest Filed; Motion to
Plaintiff, * Dismiss; Mootness; Motion for Leave to
* File an Amended Complaint; RCFC 15(a)
v. * Versus RCFC 15(d); Futility of
* Supplementation; Laches; Supplemental
THE UNITED STATES, * Complaint Permitted
*
Defendant. *
*************************************
Brian W. Craver, Washington, DC, for plaintiff.
Devin A. Wolak, United States Department of Justice, Washington, DC, for defendant.
OPINION AND ORDER
SWEENEY, Judge
This postaward bid protest concerns the award of a soil remediation contract. In its initial
complaint, plaintiff contended that the contracting officer improperly awarded the contract to
another bidder despite her beliefs that the awardee’s bid was nonresponsive and that the awardee
was not responsible. After plaintiff filed its protest, the government terminated the awardee’s
contract for its convenience and cancelled the procurement. Arguing that plaintiff’s protest is
now moot, defendant moves to dismiss plaintiff’s complaint for lack of jurisdiction. Plaintiff
opposes the dismissal of its complaint, asserting that the cancellation of the procurement did not
divest the court of jurisdiction. Plaintiff also moves for leave to amend its complaint to
challenge the government’s cancellation decision. For the reasons set forth below, the court will
permit plaintiff to amend its complaint, but dismisses as moot plaintiff’s claim that the
contracting officer improperly awarded the contract to another bidder.
*
This reissued Opinion and Order incorporates the agreed-to redaction proposed by the
parties on January 2, 2014. The redaction is indicated with a bracketed ellipsis (“[. . .]”).
-1-
I. BACKGROUND
On March 29, 2012, the United States Environmental Protection Agency (“EPA”) issued
an invitation for bids (“IFB”) to remediate the soil on as many as 2,600 residential properties in
Omaha, Nebraska.1 The EPA contemplated awarding a fixed-price, indefinite-quantity contract
to the lowest bidder who was deemed to be responsible and who submitted a responsive bid. The
base period of the contract was to be one year, followed by three one-year option periods.
Bidders were required to submit, among other materials, resumes for key personnel that reflected
the specific experience identified in the IFB. The EPA emphasized the importance of the
experience and qualifications of key personnel, and declared that a bid that did not identify key
personnel who had the requisite experience and qualifications would be deemed to be
nonresponsive.
At least two companies submitted bids: plaintiff and PK Management Group, Inc.
(“PK”). PK was the low bidder, with a total bid price of $23,897,255. Plaintiff, with a total bid
price of [. . .], was the next lowest bidder. Upon reviewing PK’s bid, however, the contracting
officer concluded that PK did not meet the IFB’s requirements because it lacked relevant
experience, its subcontractors lacked relevant experience, and the resumes of its key personnel
did not reflect the required experience. The contracting officer therefore found that PK was not a
responsible bidder.
Because the contract was set aside for a small business, the contracting officer was
required to refer the issue of PK’s responsibility to the United States Small Business
Administration (“SBA”) for evaluation in the SBA’s Certificate of Competency program. In the
referral, the contracting officer did not address whether PK submitted a responsive bid. On June
22, 2012, the SBA issued a Certificate of Competency to PK and notified the EPA that it
considered PK to be a responsible bidder. The SBA advised the EPA that the EPA was required
to award the contract to PK. The contracting officer disagreed with the SBA’s responsibility
determination, and filed an appeal with the SBA. The contracting officer once again did not
address whether PK submitted a responsive bid. The SBA denied the appeal, leading the
contracting officer to award the contract to PK in September 2012.
Shortly thereafter, plaintiff protested the EPA’s award decision at the Government
Accountability Office (“GAO”), arguing that PK’s bid was nonresponsive due to the
nonconforming key personnel resumes and that the SBA was not legally permitted to make a
responsibility determination if a bidder submitted a nonresponsive bid. PK’s performance of the
contract was stayed during the pendency of the GAO protest. The GAO ultimately denied the
protest on January 14, 2013. Two weeks later, on January 29, 2013, plaintiff filed the instant
protest, setting forth two counts in its complaint: (1) the EPA’s award of the contract to a bidder
1
The court derives the facts in this section from the initial complaint, the notices filed by
defendant on March 3, 2013, and July 9, 2013, and the exhibit attached to defendant’s initial
motion to dismiss.
-2-
with a nonresponsive bid was arbitrary and capricious and (2) the SBA’s determination that PK
was a responsible bidder in the absence of any finding that PK submitted a responsive bid was
arbitrary and capricious. Plaintiff sought the following relief: (1) an injunction forbidding
further performance of the contract; (2) a declaration that the contract awarded to PK was null
and void; (3) termination of the contract; (4) an injunction requiring the contract be awarded to
plaintiff as the next lowest bidder; (5) attorney’s fees and costs; and (6) any other relief deemed
just and equitable.
During a January 30, 2013 status conference, defendant represented that the EPA would
agree to stay PK’s performance of the contract pending an expedited ruling from the court on the
merits of plaintiff’s protest. Pursuant to the expedited briefing schedule, plaintiff filed a motion
for judgment on the administrative record on February 22, 2013. Then, on March 5, 2013, three
days before its response and cross-motion were due, defendant filed a notice with the court
indicating that the EPA intended to terminate its contract with PK for its convenience and
conclude the procurement.2 Defendant further noted that the EPA would then reassess its needs
for the soil remediation work that was the subject of the procurement. Based on these
representations, defendant stated that it intended to move to dismiss the protest as moot.
The EPA terminated its contract with PK on March 11, 2013. That same day, defendant
moved to dismiss this protest as moot pursuant to Rule 12(b)(1) of the Rules of the United States
Court of Federal Claims (“RCFC”). Plaintiff opposed the motion. On July 9, 2013, after
briefing had concluded, defendant filed another notice with the court indicating that because
federal government sequestration had decimated the EPA’s budget and forced it to furlough its
employees, the EPA decided to satisfy its remediation needs through existing contracts. As a
result, defendant stated, the EPA would change the scope of the work that was the subject of the
procurement at issue in this protest from remediation to the securing of property access
agreements. The new contract, worth $800,000, would be set aside for a small business.
Upon receiving defendant’s notice, the court directed the parties to file supplemental
briefs addressing what effect, if any, the information contained in the notice had on the positions
they advanced in their briefing on defendant’s motion to dismiss. Rather than filing a
supplemental brief, defendant filed a renewed motion to dismiss. Shortly after the conclusion of
briefing on the renewed motion to dismiss, proceedings in the protest were stayed for twenty-
2
In one of its briefs, defendant provides an explanation for the EPA’s decision to
terminate its contract with PK. However, the court cannot accept an attorney’s contentions in
argument as fact. See Enzo Biochem, Inc. v. Gen-Probe, Inc., 424 F.3d 1276, 1284 (Fed. Cir.
2005) (“Attorney argument is no substitute for evidence.”); Mel Williamson, Inc. v. United
States, 229 Ct. Cl. 846, 848 (1982) (“Argument is not fact.”); Del., Lackawanna & W. R.R. Co.
v. United States, 54 Ct. Cl. 35, 41-42 (1919) (“The court can not accept asseverations of counsel,
as to facts, made in argument, whether denied or conceded by the other side at the bar, without
any stipulation duly filed or other evidence . . . .”).
-3-
three days at defendant’s request.3 Subsequently, pursuant to a schedule proposed by the parties,
plaintiff moved for leave to file an amended complaint on November 4, 2013. The parties have
completed briefing on plaintiff’s motion, and, finding oral argument unnecessary, the court is
prepared to rule.
II. DISCUSSION
A. Defendant’s Motions to Dismiss
As previously noted, defendant has filed both a motion to dismiss and a renewed motion
to dismiss, arguing in both that plaintiff’s protest has been mooted by the EPA’s cancellation of
the procurement that was the subject of the protest. In both motions, defendant seeks dismissal
of plaintiff’s complaint pursuant to RCFC 12(b)(1) for lack of subject matter jurisdiction.
“[A] case is moot when the issues presented are no longer ‘live’ or the parties lack a
legally cognizable interest in the outcome.” Powell v. McCormack, 395 U.S. 486, 496 (1969).
When a case is moot, there are no justiciable issues upon which the court can render a decision.4
Flast v. Cohen, 392 U.S. 83, 95 (1968); see also Fisher v. United States, 402 F.3d 1167, 1176
3
Defendant requested the stay due to the lapse of appropriations to the United States
Department of Justice. Although the lapse commenced on October 1, 2013, defendant did not
move to stay proceedings until October 7, 2013. The court lifted the stay on October 29, 2013.
4
The “lack of jurisdiction to review moot cases derives from the requirement of Article
III of the Constitution under which the exercise of judicial power depends upon the existence of a
case or controversy.” Liner v. Jafco, Inc., 375 U.S. 301, 306 n.3 (1964); see also U.S. Const. art.
III, § 2 (“The judicial Power shall extend to all Cases, in Law and Equity, arising under this
Constitution, the Laws of the United States, and Treaties . . . [and] to Controversies to which the
United States shall be a Party . . . .”). But see Honig v. Doe, 484 U.S. 305, 329-32 (1988)
(Rehnquist, C.J., concurring) (questioning the constitutional origins of the mootness doctrine by
arguing that despite federal courts’ recognition of exceptions to mootness, such exceptions
cannot be read into Article III’s “case or controversy” requirement); Matthew I. Hall, The
Partially Prudential Doctrine of Mootness, 77 Geo. Wash. L. Rev. 562, 575 (2009) (arguing “that
if the mootness bar were truly a mandatory, jurisdictional rule imposed by the Constitution, then
the exceptions . . . could not exist”). The United States Court of Federal Claims (“Court of
Federal Claims”), as a court established under Article I of the United States Constitution, 28
U.S.C. § 171(a) (2012), is not bound by the “case or controversy” requirement of Article III,
Zevalkink v. Brown, 102 F.3d 1236, 1243 (Fed. Cir. 1996). Nevertheless, the Court of Federal
Claims and other Article I courts traditionally have applied the “case or controversy”
justiciability doctrines. See id.; Anderson v. United States, 344 F.3d 1343, 1350 n.1 (Fed. Cir.
2003); CW Gov’t Travel, Inc. v. United States, 46 Fed. Cl. 554, 558 (2000); cf. 28 U.S.C. § 2519
(using the phrase “case or controversy” in describing the finality of judgments of the Court of
Federal Claims).
-4-
(Fed. Cir. 2005) (panel portion) (noting that justiciability “encompasses a number of doctrines
under which courts will decline to hear and decide a cause,” including the “doctrines of standing,
mootness, ripeness, and political question”). The court’s inquiry into the justiciability of a case
is distinct from its inquiry into whether it has jurisdiction over the case’s subject matter. Powell,
395 U.S. at 512; Baker v. Carr, 369 U.S. 186, 198 (1962); Prasco, LLC v. Medicis Pharm. Corp.,
537 F.3d 1329, 1335 n.3 (Fed. Cir. 2008); Murphy v. United States, 993 F.2d 871, 872 (Fed. Cir.
1993). In other words, the court may find that it possesses jurisdiction over the subject matter of
a case but that the dispute is nevertheless nonjusticiable. Thus, while mootness is jurisdictional
in that it involves the court’s power to adjudicate a case,5 an RCFC 12(b)(1) motion may not be
the appropriate vehicle by which to dismiss a case as moot.6
Regardless of whether a moot claim should be dismissed for lack of subject matter
jurisdiction or for failure to state a claim upon which the court could grant relief, the standard
applied by the court in reviewing a motion urging dismissal of a claim as moot is the same: the
court assumes that the allegations in the complaint are true and construes those allegations in the
plaintiff’s favor. Henke v. United States, 60 F.3d 795, 797 (Fed. Cir. 1995).
5
See, e.g., Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 102-10 (1988)
(characterizing the justiciability issue of standing as a jurisdictional issue); North Carolina v.
Rice, 404 U.S. 244, 246 (1971) (per curiam) (“Mootness is a jurisdictional question because the
Court is not empowered to decide moot questions or abstract propositions . . . .” (internal
quotation marks omitted)); Myers Investigative & Sec. Servs., Inc. v. United States, 275 F.3d
1366, 1369 (Fed. Cir. 2002) (“[M]ootness . . . is a threshold jurisdictional issue.”); CBY Design
Builders v. United States, 105 Fed. Cl. 303, 328 (2012) (“The mootness of a case is properly the
subject of an RCFC 12(b)(1) motion.”).
6
See, e.g., Baker, 369 U.S. at 196 (holding that a court’s determination that a case that is
“unsuited to judicial inquiry or adjustment” should be dismissed for “a failure to state a
justiciable cause of action” and not for “a lack of jurisdiction of the subject matter” (internal
quotation marks omitted)); Oryszak v. Sullivan, 576 F.3d 522, 526-27 (D.C. Cir. 2009)
(Ginsburg, J., concurring) (noting that when “a plaintiff makes a claim that is not justiciable . . . a
court should dismiss the case for failure to state a claim” and that “it is important to distinguish
among failure to state a claim, a claim that is not justiciable, and a claim over which the court
lacks subject matter jurisdiction”); F. Alderete Gen. Contractors, Inc. v. United States, 715 F.2d
1476, 1480 (Fed. Cir. 1983) (reciting “the long-standing rule in the Federal courts that
jurisdiction is determined at the time the suit is filed and, after vesting, cannot be ousted by
subsequent events, including action by the parties” (emphasis added)); see also Kontrick v. Ryan,
540 U.S. 443, 455 (2004) (“Clarity would be facilitated if courts and litigants used the label
‘jurisdictional’ . . . only for prescriptions delineating the classes of cases (subject-matter
jurisdiction) and the persons (personal jurisdiction) falling within a court’s adjudicatory
authority.”).
-5-
1. Mootness
The sole basis for defendant’s motions to dismiss is its contention that plaintiff’s protest
is moot. A court “will determine only actual matters in controversy essential to the decision of
the particular case before it.” United States v. Alaska S.S. Co., 253 U.S. 113, 115 (1920). “The
controversy must be definite and concrete, touching the legal relations of parties having adverse
legal interests.” Aetna Life Ins. Co. of Hartford, Conn. v. Haworth, 300 U.S. 227, 240-41
(1937). Moreover, the controversy must exist at all stages of the litigation; it is not enough that
the controversy was alive when the complaint was filed. Steffel v. Thompson, 415 U.S. 452, 459
n.10 (1974). Because the “[m]ootness of an action relates to the basic dispute between the
parties” and “not merely the relief requested,” a case will not be rendered moot by subsequent
acts if some of the requested relief remains available. Intrepid v. Pollock, 907 F.2d 1125, 1131
(Fed. Cir. 1990); accord Church of Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992)
(holding that a case is not moot so long as the “court can fashion some form of meaningful
relief” for the injured party). And, even when subsequent acts render a case completely moot,
courts will allow the case to proceed under certain circumstances. For example, an otherwise
moot case will not be dismissed upon the voluntary cessation of the challenged activity unless
there is no reasonable expectation that the activity will recur and the effects of the activity have
been completely extinguished. Cnty. of L.A. v. Davis, 440 U.S. 625, 631 (1979).
2. The Claims in Plaintiff’s Complaint Are Moot
As noted above, in its complaint, plaintiff protested the EPA’s award of the soil
remediation contract to PK. It therefore sought a court order preventing contract performance,
declaring the contract void, terminating the contract, and requiring the EPA to award it the
contract. The EPA’s subsequent termination of the contract and cancellation of the procurement,
however, renders the court unable to award plaintiff’s requested relief. Because the EPA has
already terminated its contract with PK, the court is unable to stay performance of the contract or
terminate the contract, and a declaration that the contract was void would be meaningless. And,
because the EPA has cancelled the procurement altogether, the court–even if it had the authority
to do so–could not award the contract to plaintiff as a result of any improprieties in the EPA’s
award of the contract to PK. In short, the actions taken by the EPA after plaintiff filed its protest
rendered moot plaintiff’s challenge of the contract award.
The court’s conclusion is not without precedent; the Court of Federal Claims has
consistently found that the cancellation of a procurement renders a protest of that procurement
moot. In CCL Service Corp. v. United States, the protestor filed suit challenging the Defense
Information Systems Agency’s award of seven contracts to another company, and seeking
appropriate declaratory and injunctive relief. 43 Fed. Cl. 680, 681 (1999). After the protest was
filed, the agency terminated the seven contracts for its convenience and cancelled the solicitation.
Id. at 684, 686. The court held that the protestor’s claims for equitable relief were “definitely
moot in light of the cancellation of the contracts[.]” Id. at 690 (citing Durable Metals Prods., Inc.
v. United States, 27 Fed. Cl. 472, 477 (1993)).
-6-
The court arrived at the same conclusion in Lion Raisins, Inc. v. United States, 69 Fed.
Cl. 32 (2005). In that case, after the protestor had submitted bids in response to several
invitations to bid, the United States Department of Agriculture suspended it from bidding on
government contracts for one year. Id. at 33. The protestor filed suit challenging the suspension,
and the court issued an order preventing the agency from awarding the contracts. Id. During the
pendency of the suit, the agency cancelled the relevant solicitations. Id. The court held that
“since the contract solicitations were cancelled, Plaintiff can no longer complain that the
contracts at issue were improperly awarded . . . , because the contracts were not awarded to any
bidder.” Id. at 34.
Plaintiff attempts to rescue its complaint from dismissal by asserting that the court
possesses continuing jurisdiction to entertain its protest and consider the propriety of the EPA’s
cancellation of the soil remediation procurement. In advancing this argument, plaintiff asserts
that the court cannot dismiss its complaint so long as it remains possible for plaintiff to file an
amended complaint containing a viable claim. Plaintiff misstates the standard of review. The
court’s focus must be on the complaint actually before it, and not on the possible contents of a
not-yet-filed amended complaint. The allegations in plaintiff’s complaint relate only to the
propriety of the EPA’s award of the contract to PK. Plaintiff’s complaint does not contain any
allegations concerning the EPA’s cancellation of the soil remediation procurement.7 The court
therefore lacks the ability to consider such allegations.8
Plaintiff further claims that its request for attorney’s fees and costs permits the court to
retain jurisdiction over its complaint. Plaintiff’s contention is contrary to law. In Lewis v.
Continental Bank Corp., the United States Supreme Court (“Supreme Court”) expressly held that
“interest in attorney’s fees is, of course, insufficient to create an Article III case or controversy
where none exists on the merits of the underlying claim.” 494 U.S. 472, 480 (1990) (citation
omitted). And, the Court of Federal Claims has held that “[l]egal fees in relation to filing a bid
protest action are . . . bid protest costs,” and “because the court does not have jurisdiction over
bid protest costs, the court cannot assert jurisdiction over plaintiffs’ claim for attorney’s fees in
relation to the bid protest.” S.K.J. & Assocs., Inc. v. United States, 67 Fed. Cl. 218, 231 (2005).
Thus, plaintiff’s claim for attorney’s fees cannot provide an avenue for the court to exercise
jurisdiction over plaintiff’s otherwise moot protest.
7
In their briefs, the parties address both (1) whether the court has jurisdiction to entertain
cancellation claims and (2) the merits of plaintiff’s proposed challenge to the EPA’s cancellation
of the soil remediation procurement. However, neither issue is relevant to whether the court can
entertain plaintiff’s initial complaint.
8
Indeed, recognizing that its complaint is deficient in this regard, plaintiff seeks leave to
file an amended complaint to set forth a claim challenging the cancellation of the procurement.
That motion is addressed below.
-7-
In sum, the EPA’s termination of its contract with PK and subsequent cancellation of the
procurement renders plaintiff’s challenge to the award of the contract to PK moot.
B. Plaintiff’s Motion for Leave to Amend Its Complaint
In an attempt to avoid the complete dismissal of its protest, plaintiff moves for leave to
amend its complaint to challenge the government’s cancellation of the soil remediation
procurement. Plaintiff premises its motion on RCFC 15(a). However, because plaintiff seeks to
amend its complaint to set out events that occurred after it filed its protest, the proper basis for its
motion is RCFC 15(d). See Prasco, LLC, 537 F.3d at 1337 & n.5. That rule provides:
Supplemental Pleadings. On motion and reasonable notice, the court may, on just
terms, permit a party to serve a supplemental pleading setting out any transaction,
occurrence, or event that happened after the date of the pleading to be
supplemented. The court may permit supplementation even though the original
pleading is defective in stating a claim or defense. The court may order that the
opposing party plead to the supplemental pleading within a specified time.
RCFC 15(d).
The ability of a plaintiff to use a supplemental complaint to cure a jurisdictional defect in
an earlier-filed complaint is well settled by binding precedent. In Mathews v. Diaz, the Supreme
Court held that a plaintiff who did not satisfy a “nonwaivable condition of jurisdiction” until
after he filed suit could have cured the jurisdictional defect of his original complaint by filing a
supplemental complaint. 426 U.S. 67, 75 (1976). The United States Court of Appeals for the
Federal Circuit (“Federal Circuit”) noted that the Mathews decision was “consistent with others
holding that defects in a plaintiff’s case–even jurisdictional defects–can be cured while the case
is pending if the plaintiff obtains leave to file a supplemental pleading under Rule 15(d) reciting
post-filing events that have remedied this defect.” Black v. Sec’y of HHS, 93 F.3d 781, 790
(Fed. Cir. 1996). Whether a supplemental complaint could cure a defect, the Federal Circuit
explained, depended on whether the substantive provision providing the trial court with subject
matter jurisdiction expressly prohibited the filing of a complaint before a specified waiting period
or before the exhaustion of administrative remedies. Id. It concluded that in the absence of such
a provision, and so long as a plaintiff has satisfied the jurisdictional requirements within the
relevant limitations period, a complaint may be supplemented to cure the original jurisdictional
defect.9 Id. at 791-92.
9
This rule was applied in Central Pines Land Co. v. United States, 99 Fed. Cl. 394
(2011). In that case, the plaintiff filed a Fifth Amendment takings suit in the Court of Federal
Claims after it filed a quiet title action in federal district court; both suits related to the same
mineral rights. Id. at 396. Facing dismissal of its complaint for lack of jurisdiction pursuant to
28 U.S.C. § 1500, the plaintiff argued that its de facto supplemental complaint cured the
jurisdictional defect. Id. at 402-03. The court, relying on dicta in Black, held that 28 U.S.C.
-8-
Applying Mathews and Black to this case, it appears that plaintiff is not legally barred
from curing, with a supplemental complaint, the jurisdictional defect arising from the
cancellation of the procurement that was the subject of its protest. There are no waiting periods
or administrative exhaustion requirements for bid protests. See 28 U.S.C. § 1491(b) (describing
the bid protest jurisdiction of the Court of Federal Claims). Nor has the statute of limitations for
plaintiff’s supplemental allegations expired. See id. §§ 2401 (providing a six-year limitations
period for civil actions filed against the United States), 2501 (providing a six-year limitations
period for suits filed in the Court of Federal Claims). And, there is precedent in support of the
court’s ability to entertain protests challenging an agency’s decision to cancel a procurement.
See, e.g., MORI Assocs., Inc. v. United States, 102 Fed. Cl. 503, 519-25 (2011); Def. Tech., Inc.
v. United States, 99 Fed. Cl. 103, 114-15 (2011); Madison Servs., Inc. v. United States, 90 Fed.
Cl. 673 (2009); FFTF Restoration Co. v. United States, 86 Fed. Cl. 226, 236-45 (2009); see also
Croman Corp. v. United States, 724 F.3d 1357, 1363-65 (Fed. Cir. 2013) (reviewing, without
commenting on jurisdiction, a protestor’s contention that an agency improperly cancelled a
portion of a solicitation).
In fact, the procedural posture of this protest is quite similar to the posture of the protest
in Madison Services, Inc. In that case, the protestor sought to prevent the Federal Emergency
Management Agency from reissuing a solicitation for which it was the intended awardee. 90
Fed. Cl. at 676. It set forth three claims for relief in its complaint. Id. at 677. Upon the agency’s
formal cancellation of the solicitation at issue, the government moved to dismiss the protest as
moot. Id. The protestor immediately sought leave to file an amended complaint challenging the
cancellation decision and setting forth three additional claims for relief pertaining to that
challenge. Id. The court concluded that, to the extent that the agency’s cancellation of the
solicitation was proper, the protest would be rendered moot. Id. at 680. However, it also
concluded that plaintiff should be allowed to supplement its complaint with the cancellation-
related allegations so that the court would be presented with a justiciable controversy. Id. at 682.
Thus, it allowed the protestor to file the proposed supplemental complaint, but dismissed the
three claims for relief that originally appeared in the initial complaint. Id. at 683.
Notwithstanding the above precedent, defendant argues that the court should not permit
plaintiff to file a supplemental complaint because supplementation would be futile.10
Specifically, defendant contends that plaintiff’s proposed supplemental complaint is barred by
§ 1500 was “the type of statute containing an ‘express prohibition’ on jurisdiction such that a
court’s jurisdiction may not be ‘rescue[d]’ by a supplemental pleading.” Id. at 404 (quoting
Black, 93 F.3d at 790).
10
Defendant actually argues that the filing of an amended complaint would be futile.
However, because plaintiff’s motion for leave to amend its complaint should have been brought
under RCFC 15(d), the court characterizes defendant’s argument as an argument against
supplementation.
-9-
laches, and that a successful challenge to the EPA’s cancellation decision would merely return
the parties to the status quo ante, requiring the court to address plaintiff’s original, moot protest.
The court addresses each argument in turn.
1. Defendant Has Not Met Its Burden to Invoke Laches
Laches is “the neglect or delay in bringing suit to remedy an alleged wrong, which taken
together with lapse of time and other circumstances, causes prejudice to the adverse party and
operates as an equitable bar.” A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020,
1028-29 (Fed. Cir. 1992) (en banc). To invoke the affirmative defense of laches, a defendant
bears the burden of demonstrating that “the plaintiff delayed filing suit for an unreasonable and
inexcusable length of time from the time the plaintiff knew or reasonably should have known of
its claim against the defendant” and that “the delay operated to the prejudice or injury of the
defendant.” Id. at 1032. In analyzing whether a defendant has met its burden, “[a] court must
look at all of the particular facts and circumstances of [the] case and weigh the equities of the
parties.” Id.; accord Cornetta v. United States, 851 F.2d 1372, 1379-80 (Fed. Cir. 1988) (en
banc). At bottom, the application of laches is within the discretion of the trial court. A.C.
Aukerman Co., 960 F.2d at 1032, 1036.
Laches may be invoked in bid protests filed in the Court of Federal Claims. See Blue &
Gold Fleet, L.P. v. United States, 492 F.3d 1308, 1314-15 (Fed. Cir. 2007). However, the court
infrequently applies the doctrine. See Aircraft Charter Solutions, Inc. v. United States, 109 Fed.
Cl. 398, 408 (2013) (citing CW Gov’t Travel, Inc. v. United States, 61 Fed. Cl. 559, 569 (2004)).
Rather, the consequences of a plaintiff’s delay in filing a bid protest manifest in multiple ways:
In some cases, delay constitutes waiver by the plaintiff of a bid protest claim. In
others, delay by the plaintiff in filing a bid protest affects the court’s weighing of
injunctive relief factors. In a few cases, where delay is of an unacceptable
magnitude, the doctrine of laches may bar a bid protest.
Id. (citations omitted). Defendant asserts that this case presents an ideal case for applying the
laches defense. While defendant may ultimately be correct, it has not established laches at this
time.
To establish that laches bars plaintiff’s proposed supplemental complaint, defendant must
prove both (1) an unreasonable and inexcusable delay and (2) prejudice caused by that delay.
With respect to the latter element, defendant contends that if plaintiff was successful in
challenging the EPA’s cancellation decision, the EPA could be forced to change course from its
current plan to use existing contracts in conjunction with a contract to secure property access
agreements back to awarding the contract contemplated in the original IFB. Due to the length of
time that has passed, defendant argues, the EPA “would be severely prejudiced if it completed
the tasks [under its current plan that] it would have sought under the base-period of the contract
that [plaintiff] seeks, then had to pay for these now-unnecessary services again, at a significant
-10-
and, in the current budgetary climate, unaffordable premium.” Def.’s Resp. Mot. Amend 11.
This argument is insufficient to establish prejudice. Although defendant avers that the EPA “has
been moving forward” with its new plan to procure the soil remediation services at issue and that
a contract awarded under the original IFB would be “unaffordable” in “the current budgetary
climate,” id., it has offered no evidence to support these contentions. Averments made within a
legal argument cannot be used to satisfy an evidentiary burden–in this case, that defendant was
prejudiced by plaintiff’s purported delay in seeking to file a supplemental complaint. See Enzo
Biochem, Inc, 424 F.3d at 1284; Mel Williamson, Inc., 229 Ct. Cl. at 848; Del., Lackawanna &
W. R.R. Co., 54 Ct. Cl. at 41-42. In the absence of evidence that defendant has incurred costs
that it would not have incurred but-for the purported delay and that the EPA could not afford to
award a contract under the original IFB, defendant’s claim of prejudice is merely speculative.
And, because defendant cannot demonstrate prejudice, it cannot establish that plaintiff’s
proposed supplemental complaint would be barred by laches,11 defeating its argument that laches
would render supplementation futile.
2. Defendant Has Misstated the Effect of a Successful Challenge to the EPA’s Cancellation
Decision
Defendant also argues that supplementation of plaintiff’s complaint would be futile
because if plaintiff succeeded in its challenge to the EPA’s cancellation decision, the case would
revert to the original, now moot, protest filed by plaintiff. Defendant is incorrect. If plaintiff
prevailed in its challenge to the EPA’s cancellation decision, and if, as plaintiff requests, the
court issued an injunction requiring the EPA to award a contract under the original IFB,
plaintiff’s original protest arguments concerning the award of the contract to PK would be
irrelevant because the EPA has terminated its contract with PK. Plaintiff does not, for obvious
reasons, seek to challenge the EPA’s termination of its contract with PK; plaintiff’s challenge is
directed at the EPA’s subsequent and distinct decision to cancel the procurement in lieu of
awarding a new contract under the original IFB. Thus, the court would not need to revisit the
EPA’s decision to award the contract to PK. Defendant’s second futility argument, therefore,
lacks merit.
3. Plaintiff May File a Supplemental Complaint
Defendant has not established that plaintiff should be precluded from filing a
supplemental complaint. Moreover, it bears noting that if the court denied plaintiff’s motion for
leave to amend its complaint and dismissed its protest as moot, there would be nothing
preventing plaintiff from filing a new protest challenging the EPA’s decision to cancel the soil
11
This conclusion does not foreclose defendant from reasserting a laches defense upon
the filing of a supplemental complaint if it can produce the necessary evidence to satisfy its
burden. In fact, based on the contents of the parties’ briefs, it appears that defendant’s
contentions regarding plaintiff’s delay in asserting its cancellation-related claims may be
meritorious, if substantiated by appropriate evidence.
-11-
remediation procurement. As with any other protest, defendant would then be required to
produce an administrative record pertaining to the EPA’s decision, see RCFC App. C, ¶¶ 21-23,
after which it could move to dismiss the protest or request judgment on the administrative record,
see id. ¶ 8. Thus, in the absence of any showing that the filing of a supplemental complaint
would be futile, it makes little sense not to permit the supplementation. See Black, 93 F.3d 791-
92 (noting that “there would be no more than a formal distinction between filing a supplemental
pleading and filing a new petition with the additional . . . allegations included); Madison Servs.,
Inc., 90 Fed. Cl. at 683 (“If the court were to deny plaintiff’s motion to amend (or, rather, to
supplement) its complaint, forcing plaintiff to file a new petition, nothing would be gained save
the court’s collection of a new filing fee. To paraphrase the Supreme Court, it is far too late in
the day, and entirely contrary to the spirit of the rules of the court and to longstanding principles,
for decisions on the merits to be avoided or delayed on the basis of such mere technicalities.”).
In sum, the court will permit plaintiff to supplement its complaint pursuant to RCFC 15(d).
III. CONCLUSION
As set forth above, the court GRANTS plaintiff’s motion for leave to file an amended
complaint. Further, the court GRANTS both of defendant’s motions to dismiss and
DISMISSES plaintiff’s original protest, i.e., counts one and two of plaintiff’s original and
proposed amended complaints, as MOOT.
Plaintiff shall file its proposed amended complaint, which the court deems to be a
supplemental complaint, no later than Monday, January 6, 2014. The court will then contact
the parties to schedule a status conference to discuss a schedule for further proceedings.
The court has filed this ruling under seal. The parties shall confer to determine agreed-to
proposed redactions. Then, by no later than Monday, January 6, 2014, the parties shall file a
joint status report indicating their agreement with the proposed redactions, attaching a copy of
those pages of the court’s ruling containing proposed redactions, with all proposed
redactions clearly indicated.
IT IS SO ORDERED.
s/ Margaret M. Sweeney
MARGARET M. SWEENEY
Judge
-12-