Alfa Laval Separation, Inc. v. United States

47 Fed. Cl. 305, 2000 U.S. Claims LEXIS 162, 2000 WL 1154968
CourtUnited States Court of Federal Claims
DecidedAugust 14, 2000
DocketNo. 97-536C
StatusPublished
Cited by9 cases

This text of 47 Fed. Cl. 305 (Alfa Laval Separation, Inc. 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
Alfa Laval Separation, Inc. v. United States, 47 Fed. Cl. 305, 2000 U.S. Claims LEXIS 162, 2000 WL 1154968 (uscfc 2000).

Opinion

OPINION

MILLER, Judge.

This case is a post-award bid protest brought by a contractor that was not awarded a requirements contract and unsuccessfully sued to enjoin contract performance in the United States Court of Federal Claims.

Following consideration of the contractor’s appeal, the Federal Circuit “remanded for further proceedings consistent with [its] opinion.” Alfa Laval Separation, Inc. v. United States, 175 F.3d 1365, 1368 (Fed.Cir. 1999), petition for reh’g denied, No. 98-5087 (Fed.Cir. July 26,1999). Plaintiff and defendant advised this court that they read the remand to order two different resolutions, and the court ordered briefing by all three parties. The court now considers whether the Federal Circuit issued a prejudice determination; what significance, if issued, that prejudice determination bears; to what “further proceedings” the Federal Circuit was referring in its remand; and whether the contractor is entitled to proposal preparation costs. The court rules that, because the Federal Circuit found prejudice, further inquiry is not appropriate; that the contractor is entitled to an order prohibiting the agency from fulfilling its requirements on this contract other than with plaintiff; and that plaintiff, at this date, may not amend its complaint to recover proposal preparation costs.

FACTS

A recapitulation of the procedural and procurement histories to date is essential to address the legal issues on remand. Facts not reiterated here can be found in Alfa Laval Separation, Inc. v. United States, 40 Fed.Cl. 215 (1998), rev’d, 175 F.3d 1365 (Fed. Cir.1999).

For more than 20 years, Alfa Laval Separation, Inc. (“plaintiff’), was the sole-source provider of centrifugal purifiers to the United States Department of the Navy. During 1996 plaintiff informed the Navy that certain purifiers were beyond repair and could be replaced for approximately $350,000.00 per unit, or approximately $18.9 million in total. Eschewing sole-source procurement based on such a high cost, the Navy opened the procurement to competitive bidding.

Of the six potential offerors, only two, plaintiff and Westfalia Separators, Inc. (“intervenor”), submitted proposals. Plaintiff submitted three proposals, the least expensive of which would have cost the Navy $19.4 million, a cost higher than that which caused the Navy to have the contract bid competitively. Intervenor’s proposal came in at approximately $13.7 million. The Navy awarded the purifier contract to intervenor on July 3,1997.

On August 8, 1997, plaintiff filed an application for a temporary restraining order and a motion for a preliminary injunction to enjoin the Navy from acquiring centrifugal purifiers from intervenor by means of the contract. On August 13, 1997, a hearing was held at which the court had planned to receive evidence on plaintiffs application for a temporary restraining order. As of this date, the Navy had ordered eight purifiers from intervenor. The value of this order was approximately $1,893,000.00. Prior to the hearing, however, the parties had entered [307]*307into an agreement whereby plaintiff would withdraw its application for a temporary restraining order, and the Navy would neither place any further orders nor accept any previously ordered purifiers procured under the contract pending decision on plaintiffs complaint. This agreement was memorialized in an August 14,1997 consent order.

During trial held in January 1998, the court granted defendant’s and intervenor’s motion pursuant to RCFC 52(c) for a judgment on partial findings. The only issues that remained open were Type II vibration testing and compliance with market acceptability criteria. On January 23, 1998, the court issued an opinion that found a clear violation of an applicable procurement statute and regulation. Recovery nonetheless was denied because the violation did not amount to a prejudicial violation. Based on the “colossal” price disparity between the two offerors and, more importantly, on plaintiffs proposal price, which was higher than the sole-source price that precipitated competitive bidding, the court determined that plaintiff had not demonstrated a reasonable likelihood that it would have received the contract in the absence of Navy wrongdoing. See Alfa Laval, 40 Fed.Cl. at 234-35. Judgment entered on January 26,1998.

Plaintiff filed its notice of appeal on March 10, 1998. On May 7, 1999, the Federal Circuit reversed the judgment entered on this court’s opinion and on July 26, 1999, denied defendant-appellee’s petition for rehearing. The Federal Circuit issued its mandate on August 2, 1999. On August 4, 1999, this court vacated the judgment and ordered the parties to file a joint status report by August 23,1999.

The parties requested, and were granted, an extension to file the status report until August 30, 1999. This status report indicated that, by agreement, the Navy was enjoined from ordering any more purifiers from intervenor. Defendant made additional representations, including that the Navy intended to make no further purchases under the contract because of a change in requirements and that the contract need not be terminated because it was an indefinite quantity contract, the minimum requirement of which had been met. Plaintiff claimed entitlement under the Federal Circuit decision to an injunction preventing further orders from intervenor and the installation of previously delivered but uninstalled purifiers, a termination for convenience of the contract, an award of the contract to plaintiff, and an award of a pro rata share of it proposal preparation costs related to the number of purifiers delivered by intervenor.

On September 3,1999, the court ordered a September 16, 1999 status conference. On September 17, 1999, the court memorialized an agreement by defendant, on behalf of the Navy, neither to purchase nor to order purifiers from intervenor under the contract pending further order of the court and ordered briefing on the remand issues. By November 12, 1999, defendant was to file its brief after consultation with plaintiffs counsel as to the issues that defendant should address. By December 15, 1999, plaintiff was to respond; by January 5, 2000, defendant, to reply.

On November 3, 1999, the parties requested an extension of time to pursue settlement. Two days later, the court granted the extension, permitting defendant to file its brief, or an informal notice of settlement discussions, by November 24, 1999. On November 24, 1999, the parties notified the court of their settlement discussions and indicated that a further report would be provided by December 8, 1999. On November 30, 1999, the court ordered that the parties file a status report by December 8, 1999, stating with particularity the status of settlement.

The parties notified the court of the particulars of ongoing settlement discussions on December 8, 1999. They had reached agreement as to nonmonetary relief. As to monetary relief, defendant was willing to entertain a proposal from plaintiff, which was to provide its proposal and basis therefor to defendant by December 10, 1999. The parties requested that they be permitted to notify the court by January 11, 2000, as to whether they had reached terms upon which settlement could be finalized. On December 10, 1999, the court ordered a status report to be filed by January 14, 2000.

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Bluebook (online)
47 Fed. Cl. 305, 2000 U.S. Claims LEXIS 162, 2000 WL 1154968, Counsel Stack Legal Research, https://law.counselstack.com/opinion/alfa-laval-separation-inc-v-united-states-uscfc-2000.