Lombard Corporation v. Resor

321 F. Supp. 687, 1970 U.S. Dist. LEXIS 9466
CourtDistrict Court, District of Columbia
DecidedNovember 19, 1970
DocketCiv. A. 2200-70
StatusPublished
Cited by11 cases

This text of 321 F. Supp. 687 (Lombard Corporation v. Resor) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lombard Corporation v. Resor, 321 F. Supp. 687, 1970 U.S. Dist. LEXIS 9466 (D.D.C. 1970).

Opinion

MEMORANDUM

PRATT, District Judge.

Plaintiff is an unsuccessful bidder for a contract issued by the Chamberlain Manufacturing Corporation. This matter is before the Court on plaintiff’s motion for preliminary injunction, and defendants’ motion to dismiss the complaint, or in the alternative, for summary judgment. A hearing was held on these motions on August 21, 1970. Following the hearing the parties submitted supplemental affidavits and memoranda.

I. THE FACTS.

In October, 1968, plaintiff was invited to submit a bid for the design and manufacture of two 155 mm. forging press lines, to be installed in the Scranton Army Ammunition Plant, owned by the U. S. Government and operated by Chamberlain on a cost-reimbursable basis for the Army. Plaintiff submitted its proposal on October 25, 1968, quoting a total price of $1,375,000 for the two press lines. Only one other bid was received, that being from Verson All Steel Press Co., for roughly twice the amount of plaintiff's bid. Chamberlain was required under the terms of its cost-reimbursable facilities contract with the Army to have all subcontracts totalling over $100,000 approved before work was begun. In this instance, because of the importance of the project and the large disparity in price, Chamberlain requested that the Defense Contract Administration Services Office (hereinafter re *689 ferred to as DCASO) conduct a preaward survey of Lombard to determine if it was qualified to do the work. That survey, completed on December 17, 1968, recommended that no award be made to Lombard because it was not a “responsible” bidder. 1

Chamberlain accordingly canceled the original solicitation and issued a second, to which Lombard was not invited to respond. Through an alleged oversight, plaintiff was never formally notified that its bid had been rejected and that a second solicitation was taking place. Upon learning informally of the resolicitation, Lombard filed a protest with the Comptroller General on March 26, 1969, on the ground that it had submitted the lowest responsive bid, rejection of which would be prejudicial to the interest of the United States. After a conference on July 9, 1969, representatives of the Comptroller’s office agreed that mistakes had been committed in the DCASO survey and that exclusion of the plaintiff on the basis of that report was therefore improper, but no finding was made that plaintiff should have been awarded the contract. 2 Chamberlain was directed to issue a third solicitation which would include Lombard, although this procedure was objected to, plaintiff taking the position that this would be without prejudice to its protest under the first solicitation. Since the Army apparently felt that the original specifications were subject to wide interpretation, they were supplemented in the third solicitation, and bids were requested on an additional press line.

Plaintiff submitted a bid on the third solicitation identical to its earlier proposal, in spite of the addition of the third line and the more detailed speeifications. Indeed, this was a summary bid, incorporating the earlier papers. After holding standard negotiating conferences with Lombard on its proposal and allowing time for the filing of supplemental papers, Chamberlain determined that the bid of Lombard was non-responsive and it was rejected. Contracts for the press lines were awarded to Erie Foundry and the E. W. Bliss Company. Plaintiff then filed a written protest with the Comptroller General’s office. This was rejected on April 7, 1970, with the statement that the award would not be questioned “in the absence of illegality or a showing that a proposed award is definitely against the interests of the United States.”

Lombard brought this action on July 23, 1970, seeking preliminary and permanent injunctions against any payments by the United States to Chamberlain on the contracts in.question, and a declaratory judgment that it was “entitled” to be awarded the contract under the doctrine of Scanwell Laboratories v. Shaffer, 137 U.S.App.D.C. 371, 424 F.2d 859 (1970). Although plaintiff originally sought damages, it deleted this request in an amended complaint filed August 19,1970.

II. THE GOVERNMENT’S MOTION TO DISMISS.

The Government by way of response filed a motion to dismiss the complaint and has advanced five different reasons in support thereof: (1) plaintiff lacks standing to bring the action 3 ; (2) Chamberlain is an indispensable party; (3) plaintiff has no legally protected interest which would allow it the relief it requests; (4) the suit is unconsented and hence is impermissible because of *690 sovereign immunity; and (5) the action is barred by laches. It is the judgment of the Court that none of these arguments is viable.

(1) Plaintiff’s standing to sue.

The Government contends that Chamberlain is not a purchasing agent for the Army, but rather is an independent contractor, and hence any contract between Chamberlain and another firm would be a private one, to which the United States is not a party. Under this analysis the Armed Services Procurement Act, 10 U.S.C. § 2301 et seq. would not apply to the procurement in this case, although the Government does admit to applying a general standard of fairness in evaluating Lombard’s proposals and complaints. Taking all of this into account, the Government urges that plaintiff lacks standing to challenge the award under the Scanwell doctrine.

While the record indicates clearly that Chamberlain is not a procurement agent for the Army in the usual sense, just as clearly it possesses something more than the status of an independent contractor. The Government and Chamberlain are intimately involved in every aspect of the operation of the Scranton plant. The Government owns the factory and manufacturing equipment; title to new “facilities” such as the press lines in question passes directly to the Government upon delivery by the vendor to Chamberlain; Army personnel work closely with Chamberlain’s engineers in drawing up the specifications for a solicitation ; the cost-reimbursable contract between the Army and Chamberlain contains many provisions incorporating various sections of the Armed Services Procurement Regulations (ASPR) ; inter-firm correspondence indicates that Chamberlain considered itself an agent for at least some purposes while making the procurement (for example, so far as application of the Government regulation pertaining to gratuities is concerned); Mr. Bill Defee, Manager of the Modernization Engineering Department of the Scranton plant, indicated that Chamberlain considered ASPR applicable to its contracts (Exhibit G-l in the Administrative Record, P. 6); finally, in the first solicitation Chamberlain stated:

1. This purchase order is issued under a United States Government contract and must contain certain terms and conditions required by U. S. statutes and regulations.

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321 F. Supp. 687, 1970 U.S. Dist. LEXIS 9466, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lombard-corporation-v-resor-dcd-1970.