Diversified Maintenance Systems, Inc. v. United States

74 Fed. Cl. 122, 2006 U.S. Claims LEXIS 381, 2006 WL 3511977
CourtUnited States Court of Federal Claims
DecidedNovember 29, 2006
DocketNo. 06-706C
StatusPublished
Cited by11 cases

This text of 74 Fed. Cl. 122 (Diversified Maintenance Systems, 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
Diversified Maintenance Systems, Inc. v. United States, 74 Fed. Cl. 122, 2006 U.S. Claims LEXIS 381, 2006 WL 3511977 (uscfc 2006).

Opinion

OPINION AND ORDER1

LETTOW, Judge.

This post-award bid protest involves a construction and maintenance contract entered by the United States Department of the Army (“the Army” or “the government”) with Cadence Contract Services, LLC (“Cadence”). The protestor, Diversified Maintenance Systems, Inc. (“Diversified”), an unsuccessful bidder for the contract, asks that the award to Cadence be set aside and that the contract instead be awarded to Diversified.

[123]*123Diversified alleges, inter alia, that Cadence was ineligible for the award because Cadence was purportedly not a qualified HUBZone small business concern as required by the Army’s solicitation. Diversified previously filed a protest with the Army’s contracting officer, challenging Cadence’s eligibility under the HUBZone rules, but that protest was denied in a debriefing letter issued October 2, 2006. Promptly thereafter, on October 13, 2006, Diversified filed its complaint in this court.2

The government has in effect confessed error by filing a motion (“Def.’s Mot.”) requesting the court to remand this matter to the Small Business Administration (“SBA”) for a determination of Cadence’s HUBZone qualifications. Diversified opposes remand, arguing that a remand would be inappropriate and would merely delay the resolution of the case. The resulting question before the court concerns the remedy to be applied, and specifically whether a remand to the SBA is appropriate.

Background

On February 2, 2006, the Army issued Solicitation No. W91151-05-R-0003, requesting offers for work to repair, renovate, construct, and maintain facilities and structures on the Fort Hood Military Reservation, Fort Hood, Texas. Administrative Record (“AR”) AR 581 (Solicitation § 00700); 614 (Amendment of Solicitation (Feb. 10, 2006)). The solicitation required that the awardee be a “[qualified] HUBZone small business con-cerní].” AR 534 (Solicitation § 00700 (citing 48 C.F.R. § 52.219-3)).3

The solicitation closed on March 31, 2006. AR 639 (Amendment of Solicitation (Mar. 1, 2006)). The Army received offers from seven prospective contractors, of whom all but Cadence and Diversified were disqualified for a variety of reasons. AR 483 (Abstract of Offers). Both Cadence and Diversified represented themselves to be qualified HUBZone small business concerns. See AR 669 (Cadence Proposal), 857 (Diversified Proposal). The Army’s contracting officer notified Cadence on September 20, 2006, that it had been awarded the contract, see AR 1019 (Letter from Neta Singley, Contracting Officer, to Cadence (Sept. 20, 2006)), and Diversified on September 25, 2006, that it had not been selected. See AR 1020 (Letter from Singley to Diversified (Sept. 25, 2006)). On the same day Diversified was given notice of the award to Cadence, Diversified submitted a bid protest to the Army’s contracting officer, asserting as its primary ground of protest that—

Cadence Contract Services, LLC is not a HUBZone small business. As can be seen from attachment D hereto, Cadence Contract Services, LLC is a Utah Limited Liability firm that fists its address as “1204 W SOUTH JORDAN PKWY #D South Jordan, UT 84095.” Attachment B hereto shows that there is no HUBZone firm in Utah by that name. The SBA’s regulations defining a HUBZone small business require that the firm’s principal office AND at least 35% of its employees must reside in a[] HUBZone. Attachment K shows that Cadence’s principal office is NOT qualified as a HUBZone. Attachment C, on the other hand, shows that [124]*124Diversified Maintenance Systems, Inc., protester here, is qualified as a HUBZone firm.

Cadence Contract Services, LLC is therefore ineligible for award and non-responsive.

AR 1114-15 (Letter from Timothy Miguel Willardson to Singley (Sept. 25, 2006)).4 On October 4, the Army contracting officer denied Diversified’s protest, reciting that—

Cadence Contract Services, LLC, represented itself as a H[UBZ]one Certified small business concern, registered at 30139 State Rt. 3, Black River, New York 13612. Following the close of the solicitation, this office verified the qualifications and eligibility criteria of Cadence at that address. The Small Business Administration’s H[UBZ]one website confirms that eligibility.

AR 1123 (Letter from Singley to Willardson (Oct. 4, 2006)).

The government represents that Cadence has begun performance on the contract. Def.’s Mot. at 3.

Jurisdiction

“Jurisdiction must be established as a threshold matter before the court may proceed with the merits of this or any other action.” OTI America, Inc. v. United States, 68 Fed.Cl. 108, 113 (2005) (citing Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 88-89, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998)). This court has jurisdiction over bid protests, including post-award challenges to federal procurement decisions, under Subsection (b) of the Tucker Act, 28 U.S.C. § 1491(b)(1), added by the Administrative Dispute Resolution Act, Pub.L. No. 104-320, 110 Stat. 3870, 3874 (1996). Diversified’s action challenging the award of a contract by the Army to Cadence falls squarely within this statutory grant of jurisdiction to this court. See PGBA LLC v. United States, 389 F.3d 1219, 1224 (Fed.Cir.2004).

Standards for Decision

This court’s review of a federal agency’s decision regarding a contractual solicitation or award is governed by provisions of the Administrative Procedure Act (“APA”), 5 U.S.C. § 706. See 28 U.S.C. § 1491(b)(4).5 The pertinent standards require the court to set aside an agency contracting decision that is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). This court’s review is limited to determining whether the agency’s “decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment.” Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971), abrogated in part by Califano v. Sanders, 430 U.S. 99, 105, 107, 97 S.Ct. 980, 51 L.Ed.2d 192 (1977) (abrogating Overton Park to the extent it recognized the APA as an independent grant of subject matter jurisdiction). In undertaking review under these standards, the court may not “substitute its judgment for that of the agency,” Keeton Corr., Inc. v. United States, 59 Fed. Cl. 753, 755 (2004) (quoting Overton Park, 401 U.S. at 416, 91 S.Ct. 814), and may overturn an agency’s decision only if “the procurement official’s decision lacked a rational basis; or ...

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Bluebook (online)
74 Fed. Cl. 122, 2006 U.S. Claims LEXIS 381, 2006 WL 3511977, Counsel Stack Legal Research, https://law.counselstack.com/opinion/diversified-maintenance-systems-inc-v-united-states-uscfc-2006.