Tech Systems, Inc. v. United States

50 Fed. Cl. 216, 2001 U.S. Claims LEXIS 163, 2001 WL 998055
CourtUnited States Court of Federal Claims
DecidedAugust 23, 2001
DocketNo. 01-186C
StatusPublished
Cited by44 cases

This text of 50 Fed. Cl. 216 (Tech Systems, 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
Tech Systems, Inc. v. United States, 50 Fed. Cl. 216, 2001 U.S. Claims LEXIS 163, 2001 WL 998055 (uscfc 2001).

Opinion

SUBSTITUTE OPINION

MILLER, Judge.

This post-award bid protest is before the court after argument on cross-motions for judgment on the administrative record. The issue to be decided is whether the United States Department of Agriculture acted arbitrarily in awarding a contract procurement set-aside for small businesses to a company that allegedly is not a qualifying small business. After a truncated2 argument on the cross-motions, on June 12, 2001, the court remanded Count V to the United States Department of Agriculture to allow the contracting officer to issue a “Cost & Technical Trade-Off Analysis” pursuant to Federal Acquisition Regulation, 48 C.F.R. (“FAR”) §§ 15.101-1, 15.308 (2000). This decision, which was filed with the court on July 17, 2001, concluded that the successful bidder offered the best value to the Government. Plaintiff thereafter filed its Renewed Motion for Summary Judgment on Count V of its Amended Complaint, and implicitly revived Counts I-IV, which had been deferred pending the Count V remand.

FACTS

The following facts are drawn from the Administrative Record, as well as affidavits filed in connection with the parties’ motions. The United States Department of Agriculture (the “USDA”) contracts with an outside vendor to sort and deliver mail at three buildings of its Management Office in Kansas City. The USDA’s contract with its existing vendor, Markrist Engineers, Inc. (“Mar-krist”), was due to expire on September 30, 2000. On August 11, 2000, the USDA issued Request for Proposals No. KCMO-02-N-00 (the “RFP”) to secure a replacement contractor. The new contract was to begin on January 1, 2001, and last for one year, with two one-year optional periods. The solicitation weighed past performance and technical abilities at 65%, quality assurance at 20%, and price at only 15%. Ultimately, out of 100 possible points, plaintiff scored less than four points lower than the awardee, and its price was 10% lower than that of the awardee.

The USDA set aside the procurement for small business concerns, which are businesses that meet certain criteria as defined by the Small Business Administration (the “SBA”). Although the contract was awarded without negotiation, insofar as the concept contemplates interaction between the owner and offeror, the applicable FAR regulation treated the procurement as negotiated.3

One criterion for an SBA set-aside is that an eligible business has annual receipts under the small business threshold set for the Standard Industrial Classification (“SIC”) Code under which the proposed contract services fall. The proposed mail services fell under SIC Code 8744 (“Facility Support Management Services”), which set a maximum size standard of $5.0 million in annual receipts. In response to the RFP, Tech Systems, Inc. (“plaintiff’); Guilltone Properties, Inc. (“Guilltone”); and 12 other offerors submitted proposals to the USDA. Both plaintiff and Guilltone certified that they qualified as small business concerns for purposes of the proposal.

Due to delays in the procurement process,4 the original contract was extended twice, ulti[219]*219mately to December 31, 2000.5 Angela R. Allen, the Contracting Officer, was supported by a team that reviewed the bids and provided her with its analysis on November 22, 2000. Upon Ms. Allen’s November 27, 2000 review, she determined that errors in the evaluations would require the team to “take another look at the proposals.” Ms. Allen received the team’s re-evaluations on December 5, 2000.

On December 14, 2000, the contracting officer ordered reports from Dun & Bradstreet Inc. containing financial information on the three highest-ranking firms. Ms. Allen received these reports on December 18, 2000. The Dun & Bradstreet reports provided annual “sales” figures for both Guilltone and plaintiff.6 According to Dun & Bradstreet, Guilltone’s President John Guillory “submitted the following partial estimates dated MAY 01 2000: Sales for 1999 were $4,000,000.”

By mid-December 2000, no award had been made, and the existing contract was soon to expire. According to an undated “Note to the File” in the Administrative Record, Ms. Allen investigated securing an additional one-month contract extension with Markrist on December 6, 2000. The extension would allow time for the contracting officer to make the “award and for contractor transition.” FAR § 15.503(a)(2) requires a contracting officer, in advance of contract award, to notify unsuccessful offerors of the name and address of the apparently successful offeror, when the procurement is set aside for small businesses, in order to permit unsuccessful offerors to file a size protest with the SBA, unless the contracting officer documents the urgency of making an award without notice. FAR § 15.503(a)(2)(iii). Ms. Allen made the determination, documented in the undated note to file, that “time did not allow for pre-award notifications due to the need to award the contract immediately so that mailroom services were not interrupted.” According to Ms. Allen, the lack of time was due to Markrist’s inability to extend further contract performance.7 Ultimately, Guilltone’s offer was $1,683,470.00, and plaintiffs, $1,513,270.77 — for a difference of $170,199.23.

The contracting officer awarded the contract to Guilltone on December 18, 2000. [220]*220Ms. Allen did not document her rationale for the decision to award, although FAR § 15.308 calls for a cost/technical tradeoff. Moreover, FAR § 15.503(b) requires a post-award notice stating the name and address of the awardee, as well as the price. Notice of the award was mailed to plaintiff and other unsuccessful bidders several days after the award had been made. The letter, dated December 21, 2000, identified the awardee as “Guilltone Industries,” rather than Guilltone Properties, Inc., and did not state Guilltone’s business address or the contract price. Plaintiff received notice of the award on January 2, 2001. Guilltone began performing the contract on or about January 2, 2001.

Pursuant to a request for a debriefing regarding the reasons why plaintiff did not receive the award, Ms. Allen, on January 4, 2001, mailed a debriefing letter to plaintiff, via certified mail, which again described the awardee as “Guilltone Industries,” but did not disclose the awardee’s address or the price. An enclosure with the debriefing letter identified the successful bidder as “Guill-tone/WC Parrish.” Plaintiff was listed as the third-ranking offeror after Guilltone, and for the first time the difference in prices between them was revealed. By letter dated January 11, 2001, the contracting officer acknowledged an error in the Abstract of Proposals that changed plaintiffs ranking from third to second.

On January 15, 2001, plaintiff filed a size protest with Ms. Allen, who forwarded it to the SBA’s San Francisco Area Office (the “SBA’s Area Office”). SBA regulations require that a size protest regarding a non-negotiated procurement be filed prior to the close of the fifth business day after proposal opening. 13 C.F.R. § 121.1004(a)(1). The protest was filed more than five business days after plaintiff received the initial notice from the USDA, but less than five business days after it received the debriefing materials.8

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Bluebook (online)
50 Fed. Cl. 216, 2001 U.S. Claims LEXIS 163, 2001 WL 998055, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tech-systems-inc-v-united-states-uscfc-2001.