126 Northpoint Plaza Ltd. Partnership v. United States

40 Cont. Cas. Fed. 76,837, 34 Fed. Cl. 105, 1995 U.S. Claims LEXIS 174, 1995 WL 528338
CourtUnited States Court of Federal Claims
DecidedSeptember 7, 1995
DocketNo. 94-993C
StatusPublished
Cited by19 cases

This text of 40 Cont. Cas. Fed. 76,837 (126 Northpoint Plaza Ltd. Partnership v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
126 Northpoint Plaza Ltd. Partnership v. United States, 40 Cont. Cas. Fed. 76,837, 34 Fed. Cl. 105, 1995 U.S. Claims LEXIS 174, 1995 WL 528338 (uscfc 1995).

Opinion

OPINION

FUTEY, Judge.

This pre-award protest is before the court on plaintiff and intervenor’s motion to enjoin cancellation of the Solicitation for Offers. Plaintiff, 126 Northpoint Plaza Limited Partnership, and intervenor, Q-Ratio Texas, Inc., request the court enjoin cancellation by defendant, the General Services Administration (GSA) on behalf of the United States, of Solicitation For Offer MTX 93415 (SFO).

Based on testimony obtained at the hearing, oral argument, and the pleadings, this court concludes that the contracting officer abused his discretion in cancelling this SFO. Therefore, cancellation is enjoined and plaintiff and intervenor should be given the opportunity to comply with the agency's current modified requirements.

Factual Background

The SFO was issued on October 18, 1993, soliciting offers for the lease of a single use building in Houston, Texas. The building would serve as a facility for the United States Immigration and Naturalization Service (INS). A total of 21 initial responses were received. Of those buildings, only plaintiff was eventually deemed responsive to INS’ needs. Defendant was concerned that it only had one building to consider; and, in July of 1994, GSA discovered that there were other buildings in the Houston area that could meet the requirements of the SFO. GSA conducted a market survey of the buildings and decided to solicit them. In accordance with GSA’s regulation entitled, “Late Submissions, Modifications, and Withdrawals of Offers,” codified at 48 C.F.R. § 552.270-3, GSA decided to evaluate the new offerors’ buildings. Between July and September 1994, defendant conducted negotiations with the new offerors and continued negotiations with plaintiff.

As of September 21,1994, GSA determined that negotiations were complete with respect to all relevant parties and solicited best and final offers (BAFOs). After evaluating the criteria, GSA forwarded a proposed lease to the intervenor stating, “[t]his proposed lease does not constitute an award.” Thereafter, plaintiff filed a complaint in this court setting out its grounds for a pre-award protest. GSA never signed the lease with intervenor, and instead, determined to cancel the SFO. On April 7,1995, the contracting officer (CO) issued findings and determinations concluding that INS’s requirements had changed substantially due to operational needs, and that upon resolicitation, the potential for enhanced competition and better pricing existed. On April 10, 1995, GSA formally can-celled the solicitation.

Discussion

I. Jurisdiction

This court and its predecessor, the Court of Claims, have long exercised jurisdiction over suits by disappointed bidders for alleged breach of an implied contract to consider bids fairly and honestly. Keco Indus., Inc. v. United States, 192 Ct.Cl. 773, 428 F.2d 1233 (1970); Coastal Corp. v. United States, 6 Cl.Ct. 337 (1984). Successful plaintiffs in these actions were once limited to recovery of bid preparation costs. Morgan Business Assocs., Inc. v. United States, 223 Ct.Cl. 325, 619 F.2d 892 (1980). In 1982, Congress enhanced this court’s remedial powers with respect to such actions by enacting 28 U.S.C. § 1491(a)(3), which provides in pertinent part:

To afford complete relief on any contract claim brought before the contract is [107]*107awarded, the court shall have exclusive jurisdiction to grant declaratory judgments and such equitable relief as it deems proper, including but not limited to injunctive relief.

The Court of Appeals for the Federal Circuit has held that the equitable jurisdiction of this court includes the power to direct reinstatement of a solicitation, provided the suit requesting this remedy was filed prior to contract award. National Forge Co. v. United States, 779 F.2d 665, 667 (Fed.Cir.1985); see also United States v. John C. Grimberg Co., 702 F.2d 1362, 1372 (Fed.Cir.1983) (the court’s equitable powers under 28 U.S.C. § 1491(a)(3) “can be invoked only by filing a claim with the court before a contract is awarded”). Here, the solicitation had not been awarded as a contract at the time plaintiff filed this action.

II. Standard of Review

Plaintiff and intervenor carry a substantial burden of proof concerning the nature of the contracting officials’ actions. Review is limited because contracting officials “may properly exercise wide discretion in their evaluation of bids and in their application of procurement regulations.” CACI Field Servs., Inc. v. United States, 13 Cl.Ct. 718, 725 (1987), aff'd, 854 F.2d 464 (Fed.Cir. 1988); Electro-Methods, Inc. v. United States, 7 Cl.Ct. 755, 762 (1985). Indeed, a contractor is never assured that it will receive an award and the government retains discretion to reject all bids without liability, even after there have been extensive negotiations with a bidder. American Gen. Leasing, Inc. and Infodyne Systems Corp. v. United States, 218 Ct.Cl. 367, 374, 587 F.2d 54, 58 (1978).1

The parties must show, by clear and convincing evidence, that either: (1) the government officials involved in the procurement process lacked a rational or reasonable basis for their cancellation decision; or (2) the procurement procedure involved a clear and prejudicial violation of applicable statutes and regulations. CACI Field Servs., Inc., 13 Cl.Ct. at 725; Aviation Enters., Inc. v. United States, 8 Cl.Ct. 1, 15 (1985); Kinetic Structures Corp. v. United States, 6 Cl.Ct. 387, 394 (1984). With respect to “clear and prejudicial violation of applicable statutes or regulations,” DeMat Air, Inc. v. United States, 2 Cl.Ct. 197, 202 (1983), plaintiff must do more than raise an issue concerning a violation of any law or regulation. The violation in question must be one that denied impartial consideration to which the parties were entitled under the implied contractual obligations of the government. CACI Field Servs., 13 Cl.Ct. at 726.

Finally, in applying the above legal standards, it is significant “that the procurement in this case was conducted in the context of negotiation rather than by formally advertised bidding.” Burroughs Corp. v. United States, 223 Ct.Cl. 53, 65, 617 F.2d 590, 598 (1980). In negotiated procurements, contracting officials possess “broad discretion in the process of obtaining the contract most beneficial to. the government.” CACI Field Servs., 13 Cl.Ct. at 726;

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Bluebook (online)
40 Cont. Cas. Fed. 76,837, 34 Fed. Cl. 105, 1995 U.S. Claims LEXIS 174, 1995 WL 528338, Counsel Stack Legal Research, https://law.counselstack.com/opinion/126-northpoint-plaza-ltd-partnership-v-united-states-uscfc-1995.