Atl, Inc. v. The United States

735 F.2d 1343, 32 Cont. Cas. Fed. 72,627, 5 Cl. Ct. 1343, 1984 U.S. App. LEXIS 15020

• Court: Court of Appeals for the Federal Circuit
• Decided: June 8, 1984
• Docket: Appeal 84-987
• Status: Published

Opinions

EDWARD S. SMITH, Circuit Judge.

In this pre-award, post-suspension Government contracts case, appellant ATL, Inc. (ATL), appeals from a decision of the United States Claims Court dismissing, for lack of jurisdiction, ATL’s suit to enjoin temporarily the award of two Army Corps of Engineers (Army) contracts to any bidders other than ATL. We affirm.

Background

ATL submitted low bids, which the Army opened in December 1983 and January 1984, on two Army contracts. During this time — and in fact from July 15, 1983, until beyond the date of ATL’s filing suit in the court below — ATL has been suspended from receiving any Government contracts. We have recounted the details of this suspension, which the Department of the Navy (Navy) effected, in our opinion on that subject, ATL, Inc. v. United States (ATL I).1

Because of the Navy-initiated suspension, the Army informed ATL by letter dated March 7, 1984, that the Army would not award ATL the two contracts on which it was low bidder. ATL sued in the Claims Court for preliminary injunctive relief pending this court’s decision on the validity of the suspension in ATL I, and for final injunctive relief if ATL prevailed on its appeal here and the Navy lifted the suspension after a new hearing. The Claims Court granted the Government’s motion to dismiss ATL’s complaint for lack of jurisdiction;² ATL appeals here.

Opinion

This case differs from the two recent suspension-related cases we have considered, ATL I and Electro-Methods, Inc.,3 because, while the suit was filed below before the Government issued the awards, it was filed long after the Government had effected the suspension, as were the bids at issue filed long after that suspension. While mechanistic application of these facts does not per se determine the Claims Court’s jurisdiction, this information is relevant in resolving whether the case is styled a “bid protest” case over which the Claims Court and its predecessor court have long exercised jurisdiction,⁴ or whether the case constitutes an Administrative Procedure Act challenge to the Government’s suspension action, in which event the case belongs in district court.⁵

ATL contends that its case falls in the bid protest category because the Army breached its implied-in-fact contract to consider ATL’s two bids fairly and honestly. In particular, ATL points to the Army’s conduct in soliciting, accepting, opening, listing, publishing as low bids, and requesting extension of, ATL’s two offers, as evidence of such an implied contract. The Claims Court, after a careful discussion of both the law relating to jurisdiction and the elements of an implied-in-fact contract, found such a contract not to exist, because of the statutory prohibition against the Government’s doing business with suspended contractors.⁶ The Government urges that we affirm.

We do affirm, for the reasons set forth in the opinion below. Despite apparent conduct to the contrary, the Army lacked actual authority to bind the Government to a contract with ATL as long as the suspension was in place.⁷ ATL’s assertion that the statutory prohibition is not absolute because the Army must consider a suspended contractor’s bid to determine if it might fall within the statutory “compelling reason” exception to the prohibition⁸ does not apply here. There has been no suggestion from either side that the Government ever considered that there might be a “compelling reason to solicit an offer from, [or] award a contract to” ATL.⁹

ATL also contends before this court that the statutory prohibition does not apply to ATL because it was not “suspended” according to the definition of that term, which defines “suspend” as being carried out “pursuant to established administrative procedures.” ¹⁰ While in ATL I we agreed in part with the court below that the Navy’s suspension proceeding partially denied ATL of due process, such that the Navy must provide ATL with a new hearing, we did not, nor did the Claims Court, revoke or set aside that suspension.¹¹ Moreover, the Navy did follow its “established administrative procedures,” such as they were, in effectuating the suspension. ATL’s position would require that each contracting officer reexamine and second-guess the propriety of any and every suspended contractor’s suspension proceeding, a wholly impractical result which we reject in this case.

Finally, ATL urges that the 12-month suspension has expired, such that it is now eligible to receive the Army contracts, because the Navy originally de facto suspended ATL in March 1983.¹² This theory does not hold up on the facts. The Navy opened the four ATL bids at issue in ATL I in both March and April of 1983; the Navy under normal procedures would have had 60 days to determine whether the low bidder was responsible, or until May and June of 1983; and, most significantly, ATL received an Army contract in June 1983.¹³ In these circumstances we find no de facto suspension which could be considered to have expired, such that the Army would now be authorized to do business with ATL.

We therefore affirm the opinion of the Claims Court, granting the Government’s motion to dismiss ATL’s suit for lack of jurisdiction.

AFFIRMED.

1 . ATL, Inc. v. United States, 736 F.2d 677 (Fed.Cir.1984). See also extensive background in the two Claims Court opinions of same title, found at 4 Cl.Ct. 374 (1984) and 3 Cl.Ct. 259 (1983).

2 . ATL, Inc. v. United States, 4 Cl.Ct. 672 (1984). This opinion contains an excellent summary of the factual background, set forth in the first 2 pages of the slip opinion.

3 . Electro-Methods, Inc. v. United States, 728 F.2d 1471 (Fed.Cir.1984).

4 . See e.g., ATL I, at 681-82; Electro-Methods, 728 F.2d at 1475; United States v. John C. Grimberg Co., 702 F.2d 1362, 1367 (Fed.Cir.1983); and Keco Indus., Inc. v. United States, 428 F.2d 1233, 192 Ct.Cl. 773 (1970). See also 28 U.S.C. §§ 1491(a)(1) and (a)(3) (1982).

5 . See ATL I, at 682; Scanwell Laboratories, Inc. v. Shaffer, 424 F.2d 859 (D.C.Cir.1970); CACI, Inc.-Fed. v. United States, 719 F.2d 1567, 1573-74 (Fed.Cir.1983).

6 . 10 U.S.C. § 2393 (1982), set forth in 736 F.2d at 680.

7 . ATL, 4 Cl.Ct. at 675.

8 . 10 U.S.C. § 2393(a)(2).

9 . Id.

10 . 10 U.S.C. § 2393(c)(2).

11 . See 4 Cl.Ct. at 675.

12 . ATL cites the August 9, 1983, Claims Court ATL opinion, wherein that court stated that "[i]n effect there was a de facto suspension.” ATL, 3 Cl.Ct. at 272. ATL also cites § 2393(a)(1)(B), allowing the Government to contract with a contractor whose suspension has expired.

13 . See ATL I, at 679 and 687 n. 52.