Eagle Design & Mgmt., Inc. v. United States

57 Fed. Cl. 271, 2002 U.S. Claims LEXIS 343, 2002 WL 32140053
CourtUnited States Court of Federal Claims
DecidedDecember 13, 2002
DocketNo. 02-1326C
StatusPublished
Cited by19 cases

This text of 57 Fed. Cl. 271 (Eagle Design & Mgmt., 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
Eagle Design & Mgmt., Inc. v. United States, 57 Fed. Cl. 271, 2002 U.S. Claims LEXIS 343, 2002 WL 32140053 (uscfc 2002).

Opinion

OPINION AFTER REMAND

FIRESTONE, Judge.

This case concerns a pre-award bid protest filed under 28 U.S.C. § 1491(b)(4). At issue is a Request for Proposal (“RFP”) for support services for the National Diabetes Information Clearinghouse, the National Digestive Diseases Information Clearinghouse, and the National Kidney and Urologie Disease Information Clearinghouse (the “government”). Eagle Design and Management, Inc. (“Eagle”), the plaintiff, objects to the Small Business Administration’s affirmance of the contracting officer’s selection of North American Industry Classification System (“NAICS”) code 561110, Office Administrative Services, as the appropriate code for this procurement. By virtue of this selection, Eagle, the incumbent contractor, will not be eligible for award.

The background facts are set forth in the court’s initial October 30, 2002 order, remanding the decision of the Small Business Administration, to the Office of Hearings and Appeals (“OHA”) for further consideration. In particular, the court ordered the OHA judge “to determine whether the contracting officer’s selection of NAICS 561110 is the most appropriate for this solicitation or whether any other code is more appropriate. The OHA must also address the alternative proposed by Eagle that was not addressed in the ... OHA decision.” On November 22, 2002, the OHA judge, after addressing the issues identified in the court’s order, reaffirmed the contracting officer’s (“CO’s”) selection of NAICS code 561110 and denied Eagle’s appeal. Eagle argues that the decision reaffirming that code selection is arbi[272]*272trary, capricious, and not in accordance with the law.

For the reasons that follow, Eagle’s protest is DENIED.

BACKGROUND

Following the remand, the OHA judge allowed Eagle to supplement the record and submit to him a binder complete with eighteen tabs of other RFPs, which Eagle argued were similar to the RFP for the clearinghouses at issue here but which had not been given the NAICS code 561110 designation. In each of the examples provided by Eagle, the clearinghouses were classified under computer or information-related codes, which allow for a larger size company to receive the award.

The CO was given an opportunity to respond to Eagle’s submission. In her response the CO stated that she did not think that the eighteen procurements identified by Eagle were sufficiently similar to the pending RFP to warrant a change in the NAICS code. To the contrary, the CO reiterated that the majority of tasks required by this RFP are administrative in nature and thus 561110 is correct. In support of this proposition, the CO attached another solicitation for a clearinghouse which had also identified NAICS code 561110 as the appropriate code. Finally, the CO noted that to the extent any other code might be appropriate, she believed that code 514120, Libraries and Archives, might also cover the RFP.

In its nine page decision, the OHA judge explained that the issue on appeal is whether the CO’s designated NAICS code is based on a clear error of fact or law. Eagle Design and Mgmt. v. United States, No. 02-1326C (SBA, OHA Nov. 22, 2002). In this connection he noted that under 13 C.F.R. § 121.402(b), the governing regulation, the correct NAICS code is the one that “best describes the principal purpose of the services being procured, in light of the industry description in the NAICS Manual, the description in the solicitation, and the relative weight of each element in the solicitation.” Id. at 8. Tested by this standard, the OHA judge concluded that the originally designated code 561110 remains appropriate, and that Eagle had failed to show that the CO clearly erred in selecting NAICS code 561110.

With respect to the other procurements identified by Eagle, the OHA judge discussed each of Eagle’s attachments and explained how each was different from the RFP at issue in this case. He also noted that “the record clearly reflects that information clearinghouse procurements have received a number of NAICS code designations, with differing size standards. This fact would appear to make it more difficult to assert the CO’s designation is in ‘clear error.’ ” Id. at 6.

In examining the various industry codes against the services called for in this RFP, the OHA judge reaffirmed his earlier decision that NAICS code 541519, Other Computer Related Services, is inappropriate because “computer related services are only incidental to the procurement,” and that NA-ICS code 514210, Data Processing Services, was also not appropriate because “this NA-ICS code covers firms which merely process data electronically. There is nothing here which would cover the writing and publishing of fact papers, answering a wide range of queries, providing meeting support, and the other functions required by the RFP.” Id. at 7-8. Further, the OHA judge examined other possible NAICS codes, including the code identified by the CO.

In rejecting these other possible NAICS codes, the OHA judge stated that:

[T]he publishing NAICS codes (511120, Periodical Publishers; 511199, All Other Publishers), cover establishments engaged in publishing various types of works, and do not cover many of the services the contractor here will have to perform---Again, the NAICS codes on educational services cover schools which provide instruction and training, which this procurement will not do. [The] CO’s alternate suggestion of [514120] Libraries and Archives does not cover the responses to requests for information, issuing publications, and meeting support services required by the instant RFP.

Id. at 8.

Finally, the OHA judge examined the appropriateness of 561110 for this procurement. [273]*273Citing the NAICS Manual, he stated that Eagle’s contention that the 561 series does not allow for the use of professional services is not correct, but that the 561 series allows for a blend of administrative and professional services:

[T]he NAICS Manual description of services in the 561 series is not strictly limited to support functions____[the government] has chosen to use this RFP to obtain the support it needs to run these clearinghouses and educational programs. This coincides with the NAICS Manual’s inclusion of such support in its description of the 561 series.

Id. at 9. In addition, the OHA judge noted that it was relevant to consider the fact that the predecessor contract for the same services was classified under the Standard Industry Classification (“SIC”)1 code 8741, Management Services, for which NAICS code 561110 is the corresponding code. The judge acknowledged that “[i]t cannot be said that there is a NAICS code with a perfect fit for this procurement. There is no single NAICS code specifically covering information clearinghouses offering all the services [the government] seeks to procure here.” Id. at 8. However, he ultimately concluded that:

[B]ecause of the wide range of administrative and office support type services the contractor is required to perform for this procurement, NAICS code 561110, Office Administrative Services, is appropriate.

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57 Fed. Cl. 271, 2002 U.S. Claims LEXIS 343, 2002 WL 32140053, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eagle-design-mgmt-inc-v-united-states-uscfc-2002.