DGR Associates, Inc. v. United States

94 Fed. Cl. 189, 2010 U.S. Claims LEXIS 588, 2010 WL 3211156
CourtUnited States Court of Federal Claims
DecidedAugust 13, 2010
DocketNo. 10-396C
StatusPublished
Cited by24 cases

This text of 94 Fed. Cl. 189 (DGR Associates, 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
DGR Associates, Inc. v. United States, 94 Fed. Cl. 189, 2010 U.S. Claims LEXIS 588, 2010 WL 3211156 (uscfc 2010).

Opinion

OPINION AND ORDER

WHEELER, Judge.

In this bid protest, Plaintiff DGR Associates, Inc. (“DGR”) challenges the Department of the Air Force’s decision to conduct an 8(a) program small business set-aside procurement for housing maintenance, inspection, and repair seivices at Eielson Air Force Base, Alaska. DGR contends that the Air Force violated the Small Business Act, 15 U.S.C. § 657a(b)(2)(B) (2006), by not giving priority to HUBZone small business concerns when there is a reasonable expectation that two or more such concerns would submit offers and that the award could be made at a fair market price. DGR is a qualified HUBZone small business concern, but is not eligible to compete under the 8(a) program. DGR prevailed in a timely bid protest at the Government Accountability Office (“GAO”), but the Air Force announced that it would not follow the GAO’s recommended decision. DGR then filed suit in this Court, requesting declaratory and injunctive relief. The Air Force awarded the contract under the 8(a) set-aside procurement to Defendant-Interve-[194]*194nor General Trades & Services, Inc. Defendant represented that the Air Force suspended performance of the contract pending the Court’s ruling in this case.

Defendant opposes DGR’s protest, arguing that the lawsuit is untimely because it was not filed before the closing date for receipt of proposals, citing Blue & Gold Fleet L.P. v. United States, 492 F.3d 1308 (Fed.Cir.2007). Defendant also argues that, under the Small Business Administration’s regulations, the Air Force was not required to give any priority to HUBZone small business concerns. The outcome of this dispute turns on the interpretation of the statutory language that Congress used to establish the section 8(a) and HUBZone small business programs. Despite executive agency memoranda to the contrary, this Court and the GAO have held that the plain meaning of the Small Business Act mandates a priority to the HUBZone program. Mission Critical Solutions v. United States, 91 Fed.Cl. 386 (2010), appeal docketed, No.2010-5099 (Fed.Cir. Apr. 2, 2010); DGR Assocs., Inc., B-402494, 2010 CPD ¶ 115 (Comp.Gen. May 14, 2010); Mission Critical Solutions, B-401057, 2009 CPD ¶ 93 (Comp.Gen. May 4, 2009); Int’l Program Group, Inc., B-400278 et al., 2008 CPD ¶ 172 (Comp.Gen. Sept. 19, 2008). The Ninth Circuit has reached a similar conclusion, giving priority to the HUBZone program. Contract Mgmt., Inc. v. Rumsfeld, 434 F.3d 1145, 1149 (9th Cir.2006).

The Court has before it Defendant’s and Defendant-Intervenor’s motions to dismiss for lack of jurisdiction, and the parties’ cross-motions for judgment on the administrative record. For the reasons stated below, the Court sustains DGR’s protest. DGR has not waived its right to challenge the Air Force’s section 8(a) solicitation because it followed required protest procedures at the agency level and at the GAO before filing suit in this Court. Blue & Gold Fleet does not require a protester raising a solicitation impropriety to file suit before the closing date for receipt of proposals, provided that timely challenges first have been made at the agency or before the GAO. See 492 F.3d at 1313, and “Discussion,” Part A, below.

On the issue of statutory interpretation, the language of the Small Business Act granting priority to the HUBZone program could not be more clear. By using the phrases “notwithstanding any other provision of law ... a contract opportunity shall be awarded on the basis of competition to qualified HUBZone small business concerns,” Congress established a priority for the HUBZone program over other competing small business programs. See 15 U.S.C. § 657a(b)(2)(B). If Congress intended something different from what it stated, Congress alone must enact an appropriate amendment, as this Court can only apply the laws as written. See, e.g., Conn. Nat’l Bank v. Germain, 503 U.S. 249, 254, 112 S.Ct. 1146, 117 L.Ed.2d 391 (1992) (“[Cjourts must presume that a legislature says in a statute what it means and means in a statute what it says there.”). The executive agency memoranda reflecting disagreement with this interpretation, more than anything, simply express disbelief that Congress could have intended a priority for the HUBZone program.1 These agencies would be better served to seek legislative relief from Congress rather than judicial relief in this Court.

With the issuance of this decision, the Court permanently enjoins Defendant from proceeding with the contract unlawfully awarded to General Trades & Services, and from awarding any contract that is not in compliance with the Small Business Act as interpreted herein.

The Small Business Act

Congress enacted the Small Business Act (“the Act”) to “aid, counsel, assist, and protect, insofar as is possible, the interests of small-business concerns.” 15 U.S.C. § 631(a) (2006). The Small Business Administration (“SBA”) is charged with carrying out the policies of the Act and with promulgating the necessary rules and regulations to fulfill its [195]*195statutory responsibilities. Id. §§ 633(a), 634(b).

To further the goal of aiding small businesses, Congress has established certain programs to assist qualifying small businesses in obtaining “a fair proportion” of Federal contracts.2 Id. §§ 631(a), 637(a)(1)(C), 657a. Two of the Act’s programs are relevant to this ease: (1) the 8(a) Business Development Program, which assists those firms owned and controlled by socially and economically disadvantaged individuals, 15 U.S.C. § 637; and (2) the HUBZone Program, which assists those small businesses operating in a “historically underutilized business zone.” Id. §§ 632(p)(2), 657a.

A. 8(a) Btisiness Development Program

Congress established the 8(a) Business Development Program through an amendment to the Act in 1978. Pub.L. No. 95-507, §§ 201-202, 92 Stat. 1757, 1761 (1978) (codified as amended at 15 U.S.C. § 637). The program’s stated purpose is to “promote the business development of small business concerns owned and controlled by socially and economically disadvantaged individuals.” 15 U.S.C. § 631(f)(2). It also “expand[ed] the program for the procurement by the United States of articles, supplies, services, materials, and construction work from small business concerns owned by socially and economically disadvantaged individuals.” Id. The Act defines socially disadvantaged individuals as “those who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities.” Id. § 637(a)(5).

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Bluebook (online)
94 Fed. Cl. 189, 2010 U.S. Claims LEXIS 588, 2010 WL 3211156, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dgr-associates-inc-v-united-states-uscfc-2010.