Geo-Med, LLC v. United States

126 Fed. Cl. 440, 2016 WL 1626106
CourtUnited States Court of Federal Claims
DecidedApril 20, 2016
DocketNos. 16-182C & 16-183C
StatusPublished
Cited by27 cases

This text of 126 Fed. Cl. 440 (Geo-Med, LLC 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
Geo-Med, LLC v. United States, 126 Fed. Cl. 440, 2016 WL 1626106 (uscfc 2016).

Opinion

Pre-Award Bid Protest; Department of Veterans Affairs; Small-Business Set-Aside; Improper Bundling; Unduly Restrictive Solicitation; Small Business Participation; Exclusion from Competitive Award

OPINION

FIRESTONE, Senior Judge.

The parties in these two related pre-award bid protests, consolidated for the purposes of this opinion, have filed cross-motions for judgment on the administrative record challenging the terms of Solicitation No. VA240C-15-R-0022 (the “solicitation”) for the supply of custom sterile procedure packs to the United States Department of Veterans Affairs (the “VA”). The plaintiffs, Geo-Med, LLC (“Geo-Med”) and Manus Medical, LLC (“Manus”) argue that the solicitation was improper because first, the contract should have been a partial or total service disabled veteran-owned small business (“SDVOSB”) set-aside; second, the solicitation contained unduly restrictive requirements and improper bundling; third, there was an unaddressed organizational conflict of interest (“OCI”) that gave an unfair advantage to another bidder, [xxxxxxxxxxxxxxxxxx] (“xxxxxxxx”) as a result of [xxxxxxxxxxj’s existing position as a Medical Surgical Prime Vendor (“MSPV”) for the VA; and fourth, that plaintiffs were wrongly excluded from the competitive range. Plaintiff Manus had previously brought a claim based on substantially the same arguments before the United States Government Accountability Office (“GAO”), which found in favor of the agency on all grounds. Plaintiff Geo-Med filed a protest of the solicitation’s terms with the agency on the same basis, and the agency rejected Geo-Med’s arguments.

At the oral argument held on March 10, 2016, the court issued a ruling from the bench denying plaintiffs’ motions for a preliminary injunction and for a temporary re-staining order. The court also dismissed plaintiffs’ protests to the extent that plaintiffs relied upon the argument that the procurement should have been a SDVOSB set-aside and the argument that the solicitation contained unduly restrictive requirements and improper bundling. The court dismissed without prejudice plaintiffs’ protests to the extent they relied upon allegations that there was an OCI favoring [xxxxxxxxxx]. The court found that this ground for challenging the solicitation was not ripe because an award had not been made, and if the contract were given to a company other than [xxxxxxxxxx], the plaintiffs’ argument would be moot. The court further dismissed without prejudice plaintiffs’ claims that they had been wrongfully excluded from the competitive range, also on ripeness grounds. In addition, the court also denied the parties’ respective motions to supplement the administrative record.

After the court issued its rulings, the agency awarded the contract to another offeror, Avid Medical, Inc. (“Avid Medical”). Accordingly, to the extent that plaintiffs’ arguments were premised on the assumption that [xxxxxxxxxx] had an advantage and thus [443]*443would be awarded the contract, those arguments are now moot. This opinion therefore memorializes the court’s bench ruling of March 10, 2016 and amends that ruling to dismiss with prejudice plaintiffs’ protests to the extent they rely upon any alleged advantage to [xxxxxxxxxx].

In addition, for the reasons stated below, the court now dismisses with prejudice Ma-nus’s assertion that it was wrongly excluded from the competitive range. Accordingly, Manus’s complaint is dismissed in its entirety with prejudice. The record before the court does not yet include the agency’s debriefing notice explaining its reasoning for excluding Geo-Med from the competitive range. Consequently, Geo-Med’s complaint is dismissed without prejudice to the extent Geo-Med challenges its exclusion from the competitive range and dismissed with prejudice with respect to all other issues.

I. BACKGROUND

A. The Solicitation and Plaintiffs’ Elimination from the Competitive Range

The following facts are not disputed and are .taken from the administrative record (“AR”).

The solicitation at issue in this case is for the procurement of custom sterile procedure packs to be used in seven different Veterans Integrated Service Networks (“VISNs”) in the Service Area Office (“SAO”) Central region, an area which includes forty-six VA facilities across twenty-one states. AR 1224. According to the solicitation, the custom pack program is “designed to develop individualized procedure packs to save on operating room start-up times, cut down on the time between patients, and generally create standard practices that result in hospital effectiveness, efficiency and charge/cost capture.” AR 1232. Prior to this solicitation, the VISNs in the central region acquired custom sterile packs under various types of contracts with different restrictions, including small-business set-asides, SDVOSB set-asides, as well as unrestricted contracts. See AR 12405. SAO-Central’s contracting office determined that this patchwork system “resulted in lost opportunities for cost reduction, capturing standardization opportunities, increasing the number of purchase orders, and quality consistency risk resulting in potential patient care issues, increased procurement lead time, and at time[s] inappropriate procurement methods.” AR 589. The agency therefore decided to solicit and award a single requirements contract for the entire central region, under which individual hospitals would be able to order surgical packs in accordance with their needs. Id.

Before issuing the solicitation, the Contracting Officer (“CO”) assigned to the procurement, Kimberly Hurt, conducted market research to determine, among other things, whether this procurement should be set aside for small businesses pursuant to FAR § 19.502-2(b).1 AR 575-1066. The CO first searched government databases and websites for capable SDVOSB s who had provided similar products in the past. AR 578. Her search uncovered sixty-three small businesses, including thirty-nine SDVOSBs and veteran-owned small businesses (“VOSBs”). Id. However, all of the SDVOSB and VOSB concerns were distributors, not manufacturers. Id. Only five of the sixty-three small businesses were manufacturers; however, after analyzing their capabilities, the CO concluded that all five “lacked the capabilities for supporting the planned requirements of the acquisition.” Id.

On January 14, 2014, the CO issued a Request for Information (“RFI”) inviting potential suppliers to participate in Industry Days, which were designed to “provid[e] for an opportunity for small businesses to discuss their capabilities.” AR 579. Eight small businesses, including Manus and Geo-Med, participated in Industry Days and indicated that they were interested in and capable of performing the contract anticipated by [444]*444the RFI. AR 579-80. However, seven out of the eight small businesses, including Ma-nus and Geo-Med, were distributors that would obtain packs of tools manufactured and assembled by large companies, and only one was a manufacturer. Id. The CO further noted that none of the small-business distributors “had experience supplying to a large geographical area, supplying a variation of packs from complex to minor procedures,” and had only “managed or performed contracts for relatively low dollar amounts compared to the estimated amount of the solicitation.” AR 591.

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Bluebook (online)
126 Fed. Cl. 440, 2016 WL 1626106, Counsel Stack Legal Research, https://law.counselstack.com/opinion/geo-med-llc-v-united-states-uscfc-2016.