Saco Defense Systems Division v. Weinberger

629 F. Supp. 385, 33 Cont. Cas. Fed. 74,263, 1986 U.S. Dist. LEXIS 29105
CourtDistrict Court, D. Maine
DecidedFebruary 20, 1986
DocketCiv. 85-0082 P
StatusPublished
Cited by1 cases

This text of 629 F. Supp. 385 (Saco Defense Systems Division v. Weinberger) is published on Counsel Stack Legal Research, covering District Court, D. Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Saco Defense Systems Division v. Weinberger, 629 F. Supp. 385, 33 Cont. Cas. Fed. 74,263, 1986 U.S. Dist. LEXIS 29105 (D. Me. 1986).

Opinion

OPINION ON CROSS MOTIONS FOR SUMMARY JUDGMENT

GENE CARTER, District Judge.

In this action Plaintiffs, disappointed contract bidders, seek to have the Court set aside an award of a contract for production of 9mm handguns by the Defendant to intervenor. This Court denied Plaintiffs’ motion for a preliminary injunction on April 8, 1985, 606 F.Supp. 446. The case is now before the Court on cross-motions for summary judgment. Under Fed.R.Civ.P. 56(c), a court may grant summary judgment

if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

Using the standard set forth in Hahn v. Sargent, 523 F.2d 461, 464 (1st Cir.1975), the Court has determined that there remain no genuine issues of material fact and that for the reasons stated below Defendants are entitled to judgment as a matter of law.

Standard of Review

In its order denying Plaintiffs’ motion for a preliminary injunction, the Court described at length the very limited standard of review to be applied by a court reviewing a procurement contract. See Saco Defense Systems Division, Maremont Corp. v. Weinberger, 606 F.Supp. 446, 450 (D.Me.1985). In order to prevail a disappointed bidder must show that the awarding agency’s decision “had no rational basis or involved a clear and prejudicial violation of applicable statutes or regulations.” Smith & Wesson v. United States, 782 F.2d 1074, 1078 (1st Cir.1986); Princeton Combustion Research Laboratories, Inc. v. McCarthy, 674 F.2d 1016, 1019 (3d Cir.1982). Moreover, in determining whether the agency’s decision had a rational basis, the court’s

inquiry must fully take into account the discretion that is typically accorded officials in the procurement agencies by statutes and regulations. Such discretion extends not only to the evaluation of bids submitted in response to a solicitation, but also to determinations by the agency with respect to the application of technical, and often esoteric, regulations to the complicated circumstances of individual procurements____ If the court finds a reasonable basis for the agency’s action, the court should stay its hand even though it might, as an original proposition, have reached a different conclusion as to the proper administration and application of the procurement regulations.

Saco Defense, 606 F.Supp. at 450-51 (quoting M. Steinthal & Co. v. Seamans, 455 F.2d 1289, 1301 (D.C.Cir.1971)).

*387 Plaintiffs’ Rule 56(f) Discovery

Plaintiffs raise several specific challenges to the rationality of the procurement process, some of which were not brought forward in the initial complaint but are, instead, the product of the discovery allowed by this Court in its order of October 4, 1985. Defendants argue that much of the discovery was outside the scope of the Court’s order and that matters so raised should not be considered by the Court. The Court’s order granted discovery under Fed.R.Civ.P. 56(f) only on the limited issue of the Army’s application of a ten percent cost factor to Beretta’s spare parts. When discovery appeared to stray from that ordered by the Court, Defendants objected and were assured by Plaintiffs that Plaintiffs were only seeking information which would reasonably lead to relevant information on the permitted topic. Plaintiffs insisted in their submission to this Court on the Rule 56 motion and in later responses to Defendants’ discovery objections, that their concern was the application of the ten percent factor and nothing else. Nevertheless, the current motion challenges the rationality of the ten percent factor, application of the quality assurance factor, and alleged arbitrariness of the Source Selection Authority as well as application of the ten percent factor.

There is authority for the proposition that the Court should consider all materials submitted by the parties on a motion for summary judgment rather than confining itself to issues raised in the pleadings. See C. Wright, A. Miller & M. Kane, Federal Practice and Procedure, § 2721 at 43 (1983). However, the issue is obscured in this case by the allegations that the discovery materials presenting the new challenges to the procurement process were the result of a discovery violation. The Court need not now address Defendants’ claims that Plaintiffs should not be allowed to assert new challenges because it is clear that all of the challenges are without merit.

Rationality of the Ten Percent Factor

The first challenge raised by Plaintiffs deals with the ten percent factor applied by Defendants to spare parts in order to estimate the cost of spare parts in the contract. Since spare parts had not previously been included in the price competition for weapons contracts, Defendants established a formula to estimate their cost for the life of the contract. Under the formula, estimated spare parts cost for either offeror equals ten percent of the total number of handguns to be purchased (31,593) times the sum of the costs of individual spare parts to be provisioned for the weapon.

The Court finds that Plaintiffs have waived this issue. Protests alleging defects in the solicitation which are apparent prior to bid opening or the closing date for receipt of proposals must be filed by that time. 4 C.F.R. § 21.2(b)(1) (1984); Self-Powered Lighting Ltd. v. United States, 492 F.Supp. 1267 (S.D.N.Y.1980). A draft of the solicitation was given to prospective bidders, including Plaintiffs, in March 1984. The draft included sections L and M, which make clear that cost of spare parts will be evaluated and instruct bidders how to price spare parts using the ten percent factor for purposes of evaluation. A meeting was held to discuss the solicitation with prospective bidders. A summary of that meeting distributed to all present, including Plaintiffs, again stated that spare parts cost would be evaluated using the ten percent formula. Plaintiffs did not protest the use of the formula until late January 1985, after Defendants announced that Beretta had won the contract.

From the draft solicitation, meeting, and meeting summary, Plaintiffs knew or should have known that spare parts cost would be evaluated using the ten percent factor. 1

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Bluebook (online)
629 F. Supp. 385, 33 Cont. Cas. Fed. 74,263, 1986 U.S. Dist. LEXIS 29105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/saco-defense-systems-division-v-weinberger-med-1986.