MED Trends, Inc. v. United States

102 Fed. Cl. 1, 2011 U.S. Claims LEXIS 1872, 2011 WL 4037418
United States Court of Federal Claims·Decided August 19, 2011·No. No. 11-420·Published·Cited by 9 cases

Opinion

OPINION

BRUGGINK, Judge.

This is a post-award protest of a solicitation for information technology services. Plaintiff, MED Trends, LLC (“MED Trends”) challenges the award by the Department of Labor (“DOL”) of a task order pursuant to an indefinite quantity/indefinite delivery contract. The awardee, MieroTeehnologies, LLC (“MicroTech”), intervened in the action. Currently before the court are the parties’ cross-motions for judgment on the Administrative Record pursuant to Rule 52.1 of the Rules of the Court of Federal Claims (“RCFC”). Also pending are defendant’s and intervenor’s motions to dismiss pursuant to RCFC 12(b)(1) and 12(b)(6). The motions are fully briefed, and we heard oral argument on August 12, 2011. For the reasons explained below, we deny defendant’s and intervenor’s motions to dismiss; we deny plaintiffs motion for judgment on the administrative record; and we grant defendant’s and intervenor’s cross-motions for judgment on the Administrative Record.

FACTUAL BACKGROUND2

MED Trends challenges a procurement made pursuant to the Veterans Technology Services Government-Wide Acquisition Contract (“VETS GWAC”). The VETS GWAC is a government-wide contract between the General Services Administration (“GSA”) and a pool of pre-qualified contractors, all of which are small businesses owned by service-disabled veterans.3 Pursuant to the VETS GWAC, and within its guidelines, these contractors are eligible to compete for information technology task orders from various federal agencies.

DOL, acting through the Occupational Safety and Health Administration (“OSHA”), issued Request for Quotations No. RFQ547327 (“RFQ”) on February 23, 2011, seeking quotations for maintenance and operation of its Integrated Management Information System. The award would be made on a “best value” basis with consideration given to three factors: technical capability, past performance, and price. Administrative Record (“AR”) 140. The three factors were not of equal importance. Rather, technical capability was significantly more important than past performance, which was significantly more important than price. Further, when combined, the non-price factors were “significantly more important than Factor III ‘Price.’ ” AR 141. The RFQ further provided that “as offerors’ ratings for the non-price factors approach equality, Factor III ‘Price’ becomes significantly more important in the award decision.” AR 141. The agency warned that “the Government will not make an award at a significantly higher overall price to achieve slightly superior technical features.” AR 141.

Task orders placed under the VETS GWAC are based on a firm fixed-price pursuant to Subpart 16.2 of the Federal Acquisition Regulation (“FAR”). An offeror’s bid, based on its estimate of cost and risk, is fixed and not subject to adjustment on the basis of the actual cost incurred while performing the contract. Here, the RFQ stated that the Contracting Officer would evaluate offerors’ proposed prices pursuant to FAR 15.404-1(b)(2)4. The price analysis could rely on a number of metrics when evaluating the reasonableness and realism of an offeror’s price, including comparing it to an independent government cost estimate (“IGCE”). Here, the task order contemplated a one-year base period with four successive one-year options. The estimated total cost of the contract was [ ]. The estimate was based on a calculation “using historical data from previous similar contracts.” AR 596. It included and was based in part on a prediction of the number [3] of full-time equivalent workers for particular' labor categories for each year of the contract.

Three offerors, MED Trends, [], and MieroTeeh submitted bids by the April 1, 2011 deadline. The technical proposals were evaluated by three DOL representatives who prepared an Evaluation Consensus Form for each of the technical proposals.

The RFQ provided for and defined adjectival ratings for the two non-price factors. “Factor I, Technical Capability,” was broken into four sub-factors: “Understanding of the Requirement,” “Key Personnel Experience,” “Corporate Experience,” and “Start-Up Plan Phase-Out Plan.” The possible ratings for each sub-factor were “Excellent,” “Good,” “Marginal,” and “Unsatisfactory.”5

MED Trends, [ ], and MicroTeeh received the following ratings for the Factor I:

MED [] MicroTeeh

Trends

Understanding of the Requirement Good Marginal Excellent

Key Personnel Good Good Good

Corporate Experience Marginal Marginal Excellent

Start-up/Phase-out Plans Excellent Marginal Excellent

AR 600.

The RFQ provided that, “[t]o receive consideration for award, a rating of no less than ‘Good’ must be achieved for Factor I, and its associated sub-factors____” AR 141. Despite the fact that MED Trends received a “Marginal” rating for “Corporate Experience,” the subsequent de-briefing letter to MED Trends reflected an “Overall Technical Rating-Good.” AR 635.

For the past performance factor, Micro-Tech received a “Low Risk” rating, and MED Trends received a “Moderate Risk” rating. AR 588, 591. Plaintiff does not challenge its past performance rating.

MED Trends’ total offered price was $16,868,386.30, which was [ ] than the IGCE. [ ] total price was [ ], which was [ ] than the IGCE. MicroTech’s total price was $39,886,717.88, which was [ ] than the IGCE. The agency conducted a price analysis of the three competing bids.6 It found MieroTech’s price to be in line with “the level and scope of work required.” AR 596. Based on the disparity between the IGCE and MED Trends’ and [] total prices, however, the price analysis concluded that “it is possible [4] that both vendors underestimated the depth of work required,” and that accepting “[ ] or MED Trends’ price proposal would expose the Government to a high level of risk.” AR 596.

On June 8, 2011, the agency issued a two-page Award Decision Memorandum. The memorandum reviewed the results of the technical, past performance, and price evaluations for all three offerors and concluded that, “[b]ased on the above, the Contracting Officer has determined that it is in the best interest of the Government” to make the award to MieroTeeh. AR 601.

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MED Trends, Inc. v. United States, 102 Fed. Cl. 1, 2011 U.S. Claims LEXIS 1872, 2011 WL 4037418 (uscfc 2011).

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