Crowley Technical Management, Inc. v. United States

123 Fed. Cl. 253, 2015 WL 5895315
CourtUnited States Court of Federal Claims
DecidedOctober 8, 2015
Docket14-1028 C
StatusPublished
Cited by10 cases

This text of 123 Fed. Cl. 253 (Crowley Technical Management, 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
Crowley Technical Management, Inc. v. United States, 123 Fed. Cl. 253, 2015 WL 5895315 (uscfc 2015).

Opinion

Bid Protest; Motion for Judgment on the Administrative Record; Permanent In-junctive Relief; Public Interests in Military Operations; Fuel Cost Realism Analysis

OPINION AND ORDER

Block, Judge.

The United States Navy’s Military Sealift Command (“MSC”), originally known as the Military Sea Transport Service, was established during World War II to be the “single managing agency for the Department of Defense’s ocean transportation needs.” 1 Today, MSC serves this country by executing its mission to “[ojperate the ships which sustain our warfighting forces and deliver specialized maritime services in support of national security objectives in peace and war.” Id. As part of this mission, MSC conducts procurements on behalf of other military components in order to replenish our nation’s naval forces. Id.

The ease at bar concerns one such contract, awarded by MSC to Maersk Line Limited (“Maersk”) for the enhancement and charter of a ship for use as a maritime support vessel. Plaintiff, Crowley Technical Management, Inc. (“Crowley”) protests *256 MSC’s evaluation of fuel costs in connection with the procurement. Plaintiff avers that MSC conducted an “irrational and unlawful evaluation” of the offerors’ projected fuel consumption costs and that consequently, its findings were arbitraiy, capricious, an abuse of discretion, and contrary to law. Plaintiff alleges that but for MSC’s unlawful evaluation, its offer would have been accepted by MSC.

Before the court are plaintiffs motions for permanent injunctive relief and judgment on the administrative record, filed pursuant to Rules 65 and 52.1(c) of the Rules of the Court of Federal Claims (“RCFC”), as well as defendant and defendant-intervenor’s cross-motions for judgment on the administrative record, filed pursuant to RCFC 52.1(c). For the reasons stated below, the court will deny plaintiffs motion for permanent injunction and judgment on the administrative record and grant defendant and defendant-intervenor’s cross-motions for judgment on the administrative record.

I. BACKGROUND

A. The Solicitation

On November 15, 2012, MSC issued a solicitation for the modification and charter of a Maritime Support Vessel (“MSV”), to be used by the United States Special Operations Command (“USSOCOM”). AR at 53. The solicitation instructed offerors to propose a “U.S. flagged, twin shaft vessel,” which would then be substantially modified in order to enable the vessel to carry out the MSC’s mission requirements. AR at 94. The listed mission requirements included the ability to “launch, recover, refuel, and resupply, small crafts, provide force protection and perform stowing, and transport, launch/recover, and refuel both manned and unmanned rotary wing aircraft.” Id. The retrofit vessel would have the capacity to host the ship’s crew and between 50 and 209 military personnel. Id.

The solicitation provided a seven month ramp-up time, during which the contractor would implement the required enhancements. AR at 73, 90, 95. In addition to the ramp-up time, the solicitation’s base period included a five-month charter. Id. At the conclusion of this base period, the solicitation’s terms granted MSC four one-year options to extend the charter. Id.

Section M of the solicitation stated that the contract would be awarded to the lowest priced technically acceptable offeror, in accordance with Federal Acquisition Regulation (“FAR”) 15.101-2. AR at 234-238. In other words, the evaluation factors other than price, namely technical and past performance, would be evaluated on an “accept able/unacceptable basis.” Id. at 234. For this reason, the solicitation provided that “the offeror with the lowest evaluated price proposal and acceptable past performance whose offer conforms fully to the solicitation requirements and meets the acceptability standards for all non-price factors” would receive the contract. Id.

The price factor for each bid comprised the costs for “program management support of ramp-up period, vessel modifications, charter hire and fuel for the firm and option time periods, redelivery bonus (if offered), and any other costs ... set forth in the offer.” AR at 236. Although innocuous in appearance, the fuel cost component has become the grand issue in this ease.

The solicitation stated that fuel costs would be based on the “pre-modified” vessel’s fuel consumption. AR at 237. To facilitate projecting these costs, the solicitation provided offerors with operational assumptions such as percentage of time underway, at loiter/an-ehor, or at port and weather conditions. AR tab 3a at 236; see AR 85 (Special Time Boxes 59-62); AR tab 3c at 39496 (Attachment 12). Offerors projected the fuel consumption of their proposed vessels in these conditions to determine fuel cost. Id. But the solicitation provided that once the vessel was modified, fuel costs would be recalculated. AR tab 28 at 2765. As a result,- the offerors’ prices included stand-in fuel cost numbers, to be replaced posbaward. Id.

MSC received thirteen proposals. AR at 1730-33. The agency deemed each of the offerors’ technical and past performance factors to be acceptable. Id. Thus, MSC selected the offeror with the lowest total price. On November 12, 2013, MSC awarded the *257 contract at issue to Maersk. AR at 1872-75. Maersk had proposed a cargo ship, the CRAGSIDE, and a total evaluated price of $163,777,124.60. AR at 1858. Crowley, in contrast, had proposed [redacted], and a total evaluated price of $[redacted]. Thus, the disparity between Maersk’s successful bid and Crowley’s unsuccessful bid was $[redacted]. Notably, this disparity can be explained by differences in fuel costs: Maersk had projected $20,628,066.59 in fuel costs, which was $[redacted] lower than Crowley’s projected fuel costs of $[redacted]. As the court has alluded, MSC’s treatment of these fuel costs is the subject of this bid protest.

B. Proceedings at the Government Accountability Office

Shortly thereafter, on November 22, 2013, Crowley filed a protest of MSC’s award decision at the Government Accountability Office (“GAO”). AR at 1879-2339. In its protest, Crowley alleged that MSC had overlooked several flaws in Maersk’s fuel calculations. Id. Crowley argued that these errors had resulted in Maersk understating its fuel costs and, therefore, undermined MSC’s decision to award the contract to Maersk. Id.

On January 10, 2014, MSC acknowledged that corrective action was warranted. AR at 2754. Accordingly, on January 16, 2014, the GAO dismissed Crowley’s protest on the grounds that MSC’s corrective action rendered the protest academic. AR at 2755.

MSC’s corrective action took the form of a cost realism analysis, 2 in which the agency reviewed the realism and methodology of the offerors’ underlying fuel calculations. AR tabs 26 & 27. To conduct the analysis, MSC established a Fuel Consumption Evaluation Team (“FCET”) made up of naval engineers and architects.

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123 Fed. Cl. 253, 2015 WL 5895315, Counsel Stack Legal Research, https://law.counselstack.com/opinion/crowley-technical-management-inc-v-united-states-uscfc-2015.