Dellew Corporation v. United States

In the United States Court of Federal Claims
No. 15-808C
(Filed Under Seal: December 11, 2015)
(Reissued for Publication: January 20, 2016)1
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DELLEW CORPORATION, *
*
Plaintiff, *
*
v. * Bid Protest; Corrective Action;
* Motion to Dismiss; Mootness;
THE UNITED STATES, * RCFC 12(b)(1)
*
Defendant, *
*
and *
*
TECH SYSTEMS, Inc., *
*
Defendant-Intervenor. *
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ORDER
On July 30, 2015, plaintiff filed this postaward bid protest challenging the contract award
to Tech Systems, Inc. (“TSI” or “defendant-intervenor”) under a solicitation issued by the United
States, acting through the United States Army Contracting Command (“Army”) in Rock Island,
Illinois. The solicitation was issued to acquire logistics support services at Schofield Barracks,
Hawaii. The parties filed cross-motions for judgment on the administrative record, and oral
argument was held on October 22, 2015. Subsequently, on November 9, 2015, the parties filed a
joint status report, and then on November 12, 12, 2015, defendant filed a notice indicating that
the Army elected to take corrective action. Specifically, defendant stated that the Army will
(1) terminat[e] for convenience the award to TSI;
(2) amend[] the request for proposals (RFP) to reflect a change in conditions that has
occurred since the last amendment to the RFP, and clarify[] § L.5.4.2.7.5(d) of the
RFP, which sets forth the requirements governing the capping of an offeror’s indirect
rates;
(3) reopen[] discussions and request[] full revised technical and cost proposals from
the final six offerors;
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The court provided the parties with an opportunity to suggest redactions to this ruling,
but in a January 20, 2016 joint status report, they indicated that no redactions were necessary.
(4) require[e] offerors and their subcontractors to confirm that their indirect rates are
capped, or to verify their understanding that the Army will cap their indirect rates at
those listed in their proposals, if meeting the conditions in § L.5.4.2.7.5(d) of the
RFP;
(5) conduct[] a new cost realism analysis of the offerors and their subcontractors; and
(6) mak[e] a new best value determination and award[] the contract accordingly.
Def.’s Notice 1-2.
In light of its decision to take corrective action, defendant argues that this protest is moot
and moves to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the
Rules of the United States Court of Federal Claims (“Court of Federal Claims”). Plaintiff’s
response to defendant’s motion advises that “[w]hile Dellew does not oppose the Government’s
request that the Court dismiss Dellew’s complaint pursuant to RCFC 12(b)(1) in principle,
Dellew disagrees with the Government’s position that such a dismissal precludes Dellew’s
recovery of reasonable attorney’s fees and litigation expenses pursuant to the [Equal Access to
Justice Act].” Pl.’s Mot. 2. In addition, defendant-intervenor’s response asserts that the
proposed corrective action “is much wider and expansive than that which would be required to
address” the issues raised by plaintiff. Def.-Int.’s Mot. 2. According to defendant-intervenor,
“[t]he changes outlined by the United States . . . can easily be changed by altering the scope of
the work post-award[, which] would allow the awardee to start performance much more
quickly.” Id.
As of the date of this order, defendant has not completed its corrective action:
consequently, there is no viable protest before the court. In the absence of an actual controversy,
the court grants defendant’s motion on mootness grounds. As explained above, plaintiff
acknowledges that the corrective action renders its claims moot. “[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). 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). Subsequent acts will
render a case moot if they make it impossible for the court to grant “‘effectual relief.’” Church
of Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992) (quoting Mills v. Green, 159 U.S.
651, 653 (1895)). However, a case will not be considered 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., 506 U.S. at 12 (holding that a case is not moot so long as
the “court can fashion some form of meaningful relief” for the injured party).
In this protest, the subsequent act invoked by defendant is the Army’s decision to take
corrective action. “A defendant’s voluntary cessation of allegedly unlawful conduct ordinarily
does not suffice to moot a case.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc.,
528 U.S. 167, 174 (2000). However, the voluntary cessation of the challenged activity may
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render a case moot if 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). Thus, when “corrective action adequately addresse[s] the effects of the challenged
action, and the Court of Federal Claims ha[s] no reasonable expectation that the action would
recur,” the case should be dismissed. Chapman Law Firm v. Greenleaf Constr. Co., 490 F.3d
934, 940 (Fed. Cir. 2007). The party asserting mootness bears a heavy burden of establishing
that the challenged activity will not recur. Friends of the Earth, Inc., 528 U.S. at 189. In this
case, defendant has met that burden because it will amend the solicitation and accept revised
proposals. Not only does plaintiff agree that the challenged activity is unlikely to occur, but also,
defendant-intervenor admits that the proposed corrective action “address[es] the issues raised
by” plaintiff. Def.-Int.’s Mot. 2.
Although defendant-intervenor contends that the corrective action is too expansive in
scope, the court is unpersuaded by this argument. In its complaint and motion for judgment on
the administrative record, plaintiff asserted that the Army erroneously awarded the contract to an
offeror that was technically unacceptable. The Army’s decision to take the corrective action
described above is therefore reasonable. After oral argument, “the Army examined whether a
change in conditions occurred at Schofield Barracks, Hawai’i[] since the last amendment to the
request for proposals . . . .” Declaration of Amy J. Hayden ¶ 2. Specifically,
The Army determined that, since the RFP was last amended, the following changes
in condition occurred: (1) the supply total decreased by 19.10%, which included
eliminating the pre-deployment training and equipment (PDTE) requirement; (2) the
maintenance total increased by 11.63%, which included adding a new requirement
for container repair; (3) the transportation total increased by 6.67%. The Army
determined that these changes resulted in a net decrease in contract effort totaling
5.32% over the base year, and by the same estimated amount for the four option
years of the contract.
Id. ¶ 3. Because “a change in conditions occurred,” resulting in a “net decrease in contract value
of 5.32%,” it is reasonable for the Army to amend the solicitation. Def.’s Reply 9. Indeed,
Federal Acquisition Regulation (“FAR”) 15.206(a) requires that “[w]hen, either before or after
receipt of proposals, the Government changes its requirements or terms and conditions, the
contracting officer shall amend the solicitation.” Consequently, amending the solicitation to
reflect these altered conditions is not only reasonable, but warranted. An amended solicitation
necessarily requires requesting revised proposals and conducting a new cost realism analysis and
best value determination—actions defendant plans to undertake. Defendant-intervenor argues
that the proposed corrective action is too wide, but does not provide any details or analysis as to
why, nor explains how altering the scope of the work post-award, as it proposes, would properly
address the net decrease in contract value. Bald assertions are insufficient to justify further
involvement by this court. Thus, for the reasons set forth above, the court finds that defendant’s
proposed corrective action is rationally related to the challenge raised by plaintiff and the altered
procurement conditions described by defendant.
Finally, although the court grants defendant’s motion to dismiss, it rejects the premise
that the corrective action strips this court of subject matter jurisdiction. Lack of subject matter
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jurisdiction is distinct from the mootness doctrine. When a case is moot, it means that there are
no justiciable issues upon which the court can render a decision. Flast v. Cohen, 392 U.S. 83, 95
(1968); see also Fisher v. United States, 402 F.3d 1167, 1176 (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); Murphy v. United States, 993 F.2d 871, 872 (Fed. Cir. 1993). An
issue is justiciable if it is within the court’s competency to supply relief. Murphy, 993 F.2d at
872; see also Fisher v. United States, 402 F.3d 1167, 1176 (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 may therefore find that it possesses jurisdiction over the subject matter of
a case but that the dispute is nonjusticiable. Baker, 369 U.S. at 198; Oryszak v. Sullivan, 576
F.3d 522, 526 n.3 (D.C. Cir. 2009) (“That a particular dispute is nonjusticiable, however, does
not mean the court lacks jurisdiction over the subject matter.”). This is precisely the case here.
Accordingly, the court GRANTS defendant’s motion to dismiss plaintiff’s complaint, and
DISMISSES plaintiff’s claims as MOOT.2 The clerk is directed to enter judgment accordingly.
IT IS SO ORDERED. The court has filed this order under seal. The parties shall confer
and file a joint status report by no later than Tuesday, January 5, 2016, indicating
their position as to whether the order should remain sealed.
s/ Margaret M. Sweeney
MARGARET M. SWEENEY
Judge
2
The court finds unavailing plaintiff’s argument that the court should issue findings of
fact and conclusions of law that plaintiff is a “prevailing party,” and as such, is entitled to
attorney’s fees and litigation expenses pursuant to the EAJA. Pl.’s Mot. 6. At its core, plaintiff
requests that the court issue an advisory opinion. As the United States Supreme Court has held,
“it is quite clear that the oldest and most consistent thread in the federal law of justiciability is
that the federal courts will not give advisory opinions.” Flast v. Cohen, 392 U.S. 83, 96 (1968)
(citation and internal quotation marks omitted). Consequently, plaintiff’s request is denied.
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