Che Consulting, Inc. v. United States

47 Fed. Cl. 331, 2000 U.S. Claims LEXIS 157, 2000 WL 1146643
United States Court of Federal Claims·Decided August 7, 2000·No. No. 99-760 C·Published·Cited by 7 cases

Opinion

OPINION AND ORDER

HEWITT, Judge.

This post-award bid protest action comes before the court on defendant’s and intervenor’s motions to dismiss, as well as the parties’ cross motions for judgment on the administrative record. Plaintiff, CHE Consulting, Inc. (CHE), protests the decision of Defense Information Technology Contracting Organization (DITCO) to issue orders pursuant to a Blanket Purchase Agreement (BPA) to Storage Technology Corporation (StorageTek) for information technology maintenance services under StorageTek’s Federal Supply Schedule (FSS) contract with the General Services Administration (GSA). See Complaint (Compl.) at pp. 1-2.

CHE challenges the BPA on the grounds that the BPA’s terms and conditions are outside the scope of the underlying FSS contract and therefore violate the Competition in Contracting Act of 1984 (CICA), 10 U.S.C. § 2304(a)(1)(A).

For the following reasons, the court denies the protest.

I. Background

The following facts are taken from the Administrative Record (AR) filed by defendant on September 28, 1999. No facts relevant to the court’s determination in this matter are in dispute.2

DITCO issued BPA No. DCA 200-99-A-0001 as part of its ongoing efforts to establish a comprehensive hardware maintenance management program for the information technology systems in place throughout the Defense Information Systems Agency (DISA), Western Hemisphere (WESTHEM).3 AR at 5, 531. DITCO is the contract administration arm of DISA. DISA WESTHEM consists of five Mainframe Processing Centers, Regional Support Activities, and supported remote sites. AR at 523. From its various facilities, DISA WESTHEM provides information technology and processing support to military departments and defense [333]*333agencies supporting military departments. AR at 523.

In early 1999, DISA WESTHEM began to implement an acquisition plan for consolidated hardware maintenance. The objective of DISA’s plan for consolidated hardware maintenance is to eliminate the multiplicity of contracting actions that were being used to obtain maintenance services for DISA WESTHEM equipment and thereby “obtain economies of scale, reduce maintenance costs, assure required maintenance services are in place, and provide consistent hardware maintenance performance at all locations.” AR at 5.

The acquisition plan described the maintenance services sought by DISA WESTHEM and established a minimum, mandatory requirement that the contractor utilize “maintenance/software diagnostic routines for hardware, both on-line and off-line for predictive maintenance and problem definition.” AR at 7. “Diagnostic” software refers to “software programs that test, evaluate, and fault-isolate components and functions of ADPE [automated data processing equipment] hardware.” AR at 532. “Predictive maintenance” refers to the “monitoring][of] equipment/component performance using diagnostics defined in [the BPA] for the purpose of identifying whether equipment is operating in accordance with established specifications.” AR at 538. Under the “predictive maintenance” requirements, “[t]he contractor shall, upon determining that an equipmenl/eomponent is about to fail or is operating outside OEM specifications, initiate action to effect repair____” AR at 538.

Because of the proprietary nature of the diagnostic software required for predictive maintenance, some Original Equipment Manufacturers (OEMs) were reluctant to establish working relationships with third-party maintenance providers. AR at 11. DISA therefore determined that only OEMs or vendors with written OEM support agreements could reliably provide the specific services required, AR at 11, 523, and decided to procure hardware maintenance services through BPAs placed under the Federal Supply Schedules. AR at 10.

On August 3, 1999, the BPA that is the subject of this lawsuit was issued to StorageTek as the OEM for all of DISA WESTHEM equipment that requires StorageTek proprietary diagnostic software for predictive maintenance. AR at 523-24. (Older generation, stand-alone StorageTek equipment continues to be serviced by third-party maintenance providers. AR at 524.) DITCO anticipates that the BPA will result in a net savings to the government of approximately $55,116 per month. AR at 525A.

Prior to implementation of the consolidation plan, CHE had provided computer maintenance services for some of the StorageTek equipment under DITCO contracts as a subcontractor. However, CHE is neither the OEM of any of the equipment serviced through this BPA, nor a vendor with a written OEM support agreement, as required by the contract. See JSF ¶ 12.4 See also AR at 7-8, 523. Thus, CHE does not possess authorized copies of StorageTek’s proprietary diagnostic software required to offer a level of service that would allow CHE to predict and prevent failure of the equipment included in the BPA, before such failure occurs. Id. ¶ 34.5 Furthermore, CHE did not have an FSS contract and therefore was not considered for award at the time that the BPA was being negotiated with StorageTek. Id. ¶25. StorageTek holds FSS contract No. [334]*334GS-35F-5049H, the schedule contract underlying the BPA in this case. JSF ¶ 27; AR at 586-659.

CHE’s complaint alleges that the terms of the BPA are outside the scope of StorageTek’s FSS contract, making the BPA unlawful. Compl. at pp. 1-2. Plaintiffs complaint states as follows:

Count I (Circumvention and Violation of CICA [Competition in Contracting Act])
The alteration, deviations and tailoring of the Contract by the BPA terms, conditions and SOW [statement of work] amounts to the creation of a new contract not contemplated by the terms of the FSS Contract or the applicable statutes and regulations. Count II (Failure to Synopsize Procurement Action)
Since the Orders are not within the scope of the Contract, the Defendant was obligated to synopsize the procurement action taken by DISA prior to award of the Orders to StorageTek.
Count III (No Justification And Approval For Other Than Competitive Procedures)
Since the Orders are not within the scope of the Contract, the Defendant was obligated to either (1) utilize competitive procedures for the procurement or (2) certify that the use of other than competitive procedures was justified and approved pursuant to the applicable laws and regulations.
Count IV (Breach Of Implied Duty of Good Faith)
Defendant’s use of an unlawful BPA to circumvent CICA and exclude Plaintiff from offering services to DISA was a breach of Defendant’s implied duty to deal fairly with Plaintiff.

Compl. ¶¶ 46, 53, 57, 64.

II. Discussion

On November 12, 1999, defendant and intervenor filed motions to dismiss the complaint under RCFC 12(b)(1) arguing that the court lacks subject matter jurisdiction to entertain CHE’s lawsuit because CHE is not an “interested party” under the 1996 amendments to the Tucker Act. See 28 U.S.C. § 1491

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Che Consulting, Inc. v. United States, 47 Fed. Cl. 331, 2000 U.S. Claims LEXIS 157, 2000 WL 1146643 (uscfc 2000).

47 Fed. Cl. 331 (Che Consulting, Inc. v. United States) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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