Acrow Corp. of America v. United States

97 Fed. Cl. 182, 2011 U.S. Claims LEXIS 33, 2011 WL 311037
United States Court of Federal Claims·Decided February 2, 2011·No. No. 10-682C·Published·Cited by 16 cases

Opinion

MEMORANDUM OPINION AND ORDER

CHRISTINE O.C. MILLER, Judge.

Before the court is Plaintiffs Motion for Injunction Pending Appeal filed on December 30, 2010. The motion is precipitated by the court’s December 17, 2010 opinion denying plaintiffs motion for judgment on the administrative record and granting defendant’s and defendant-intervenor, Mabey Bridge and Shore, Inc.’s (“MBSI”), respective cross-motions. Acrow Corp. of Am. v. United States, 97 Fed.Cl. 161 (2010), appeal docketed, No. 11-5035 (Fed.Cir. Dec. 28, 2010). After appealing that decision to the United States Court of Appeals for the Federal Circuit on December 23, 2010, Acrow Corporation of America (“plaintiff’) sought an injunction pending resolution of its appeal under RCFC 62(c). The court expedited briefing; defendant responded on January 7, 2011, and plaintiff replied on January 14, 2011. MBSI did not respond. Argument is deemed unnecessary.

DISCUSSION

An injunction pending appeal provided for under RCFC 62(e), like a stay pending appeal, is “an extraordinary remedy.” Golden Eagle Refining Co. v. United States, 4 Cl.Ct. 622, 624 (1984) (quoting Bhd. of Ry. & S.S. Clerks, Freight Handlers, Express & Station Emps. v. Nat’l Mediation Bd., 374 F.2d 269, 275 (D.C.Cir.1966)). The rule provides the United States Court of Federal Claims with the authority to grant an injunction on “terms that secure the opposing party’s rights.” RCFC 62(e). Guided by the jurisprudence of the Federal Circuit interpreting Fed. R.App. P. 8(a), the court “‘assesses the movant’s chances for success on appeal and weighs the equities as they affect the parties and the public.’” Standard Havens Prods., Inc. v. Gencor Indus., Inc., 897 F.2d 511, 513 (Fed.Cir.1990) (quot[184] ing E.I. DuPont de Nemours & Co. v. Phillips Petroleum, 835 F.2d 277, 278 (Fed.Cir.1987)); see also Hilton v. Braunskill, 481 U.S. 770, 776, 107 S.Ct. 2113, 95 L.Ed.2d 724 (1987) (explaining that under procedural rules of district courts and courts of appeals “factors regulating the issuance of a stay are generally the same”); JWK Int’l Corp. v. United States, 49 Fed.Cl. 364, 366 (2001) (noting there is no “rigid set of rules for determining where a stay is appropriate”; instead, courts “adopt a flexible approach” when balancing factors). The court considers the following factors: (1) whether the movant has made a strong showing that it is likely to succeed on the merits; (2) whether the movant will be irreparably injured absent an injunction; (3) whether issuance of the injunction will substantially injure the other interested parties; and (4) where the public interest lies. Alaska Cent. Express, Inc. v. United States, 51 Fed.Cl. 227, 229 (2001) (citing Standard Havens, 897 F.2d at 512). The court need not give each factor equal weight. Id.

1. Likelihood of success

The court’s December 17, 2010 opinion addressed plaintiff’s challenge to the United States Army TACOM Life Cycle Management Command’s (“TACOM”) award to MBSI of a five-year requirements contract to build Line of Communication Bridge (“LOCB”) systems. Plaintiff alleged that TACOM improperly had determined that MBSI was a responsible offeror because MBSI lacked a “satisfactory record of integrity and business ethics,” 48 C.F.R. (FAR) § 9.104-1 (2010), thereby rendering the contracting officer’s responsibility determination arbitrary and capricious. Plaintiffs allegations stemmed primarily from a criminal proceeding brought in the United Kingdom by the Serious Fraud Office (the “SFO”) against MBSI’s affiliate and major supplier at the time, Mabey & Johnson Ltd. (“M & J”). M & J pled guilty in September 2009 to corrupt practices for contracts in Jamaica and Ghana, including payment in the form of bribes from 1993 through 2001. The controversy was initiated by a draft counterclaim making allegations about M & J by former Mabey manager Jonathan Danos (the “Danos counterclaim”).

Plaintiff alleged that the contracting officer 1) should have been required to review the Danos counterclaim and 2) should have been prohibited from determining MBSI responsible because allegations made in the Danos counterclaim demonstrated that MBSI made a false statement to the contracting officer upon which she relied. Acrow, 97 Fed.Cl. at 171. For the reasons set forth in its opinion, the court concluded that plaintiff did not succeed on the merits.

The fluid requirements of Fed. R.App. P. 8(a), however, allow an injunction where the movant “ ‘establishes that it has a strong likelihood of success on appeal, or where, failing that, it can nonetheless demonstrate a substantial case on the merits,’ provided the other factors militate in movant’s favor.” Standard Havens, 897 F.2d at 512 (quoting Hilton, 481 U.S. at 778, 107 S.Ct. 2113). “When harm to applicant is great enough, a court will not require ‘a strong showing’ that applicant is ‘likely to succeed on the merits.’” Id. (quoting Hilton, 481 U.S. at 778, 107 S.Ct. 2113); accord Red River Holdings, LLC v. United States, 91 Fed.Cl. 621, 625 (2010). Consequently, if the equities weigh heavily in favor of maintaining the status quo, the court may grant an injunction under RCFC 62(e) when the question raised is novel or close, especially when the case will be returned to the trial court should the movant prevail on appeal. See Standard Havens, 897 F.2d at 513 (“[I]f the other elements are present (i.e., the balance of hardships tips decidedly toward plaintiff), it will ordinarily be enough that the plaintiff has raised questions going to the merits so serious, substantial, difficult and doubtful, as to make them a fair ground for litigation ....” (citing Hamilton Watch Co. v. Benrus Watch Co., 206 F.2d 738, 740 (2d Cir.1953))); see also Roland Mach. Co. v. Dresser Indus., Inc., 749 F.2d 380, 387-88 (7th Cir.1984) (“The more likely the plaintiff is to win, the less heavily need the balance of harms weigh in his favor; the less likely he is to win, the more need it weigh in his favor.”); JWK Int’l, 49 Fed.Cl. at 366 (“The stronger the showing of likelihood of success on the mer[185] its, the less heavily the balance of harms need tip in [plaintiffs] favor. Conversely, if the harm factors weigh in [plaintiffs] favor, plaintiff only needs to demonstrate a substantial case on the merits.”).

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Acrow Corp. of America v. United States, 97 Fed. Cl. 182, 2011 U.S. Claims LEXIS 33, 2011 WL 311037 (uscfc 2011).

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