Bachner Company, Inc. v. Weed

Notice: This opinion is subject to correction before publication in the P ACIFIC R EPORTER .

Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 303

K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email

corrections@appellate.courts.state.ak.us.

THE SUPREME COURT OF THE STATE OF ALASKA

BACHNER COMPANY, INC. and )

BOWERS INVESTMENT )

COMPANY, )

) Supreme Court No. S-14629

Appellants, )

) Superior Court No. 4FA-04-266 CI

v. )

) OPINION

JAMES WEED, JURANDA FAITH )

MADSON a/k/a JAN MADSON, ) No. 6848 – December 6, 2013

BRUCE SENKOW, AND JOHN )

BENNETT, )

)

Appellees. )

)

Appeal from the Superior Court of the State of Alaska, Fourth

Judicial District, Fairbanks, Michael McConahy, Judge.

Appearances: Michael C. Kramer, Kramer and Associates,

Fairbanks, for the Appellants. Janell M. Hafner, Assistant

Attorney General, and Michael C. Geraghty, Attorney

General, Juneau, for the Appellees.

Before: Fabe, Chief Justice, Stowers, Maassen, and Bolger,

Justices. [Winfree, Justice, not participating.]

BOLGER, Justice.

I. INTRODUCTION

Unsuccessful bidders on a public contract proposal filed a claim for

intentional interference with prospective economic opportunity against four individual

procurement committee members. The superior court found that the bidders failed to

present a genuine issue of material fact regarding the committee members’ alleged bad

faith conduct. The superior court then held that the committee members were protected

by qualified immunity and that the lawsuit was barred by the exclusive remedy statute.

The court deemed the committee members prevailing parties and awarded attorney’s fees

to the State. The bidders appeal.

We affirm. The bidders failed to present a genuine issue of material fact

regarding the committee members’ alleged bad faith. In addition, the exclusive remedy

statute bars the bidders’ suit. The superior court did not abuse its discretion in awarding

attorney’s fees to the State.

II. FACTS AND PROCEEDINGS

A. Facts

Bachner Company and Bowers Investment Company (together, Bachner)

were unsuccessful bidders on a state contract ultimately awarded to McKinley

Development for an Alaska Department of Transportation office building in Fairbanks.1

The bids were scored by a procurement evaluation committee based on three criteria:

(1) function, planning, and design (20 points); (2) appearance and indoor environment

(ten points); and (3) public convenience (ten points). Thus the committee could award

a total of 40 points. The appellees in this case — Jan Madson, James Weed, John

Bennett, and Bruce Senkow — were members of this committee.

The committee used a three-pass scoring system. In each pass, committee

members scored the proposals and then discussed the reasoning behind their scores. In

subsequent passes, committee members adjusted their scores based on the discussions

from the previous passes. After the second pass, the committee also visited each

proposed site.

1

See Weed v. Bachner Co., 230 P.3d 697, 698 (Alaska 2010).

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Separate from the committee scoring process, a procurement officer

awarded ten additional points to bidders who qualified for the Alaska Offeror’s/Bidder’s

Preference and up to 50 additional points for the proposal’s price score. The committee

had no control over the Alaska preference or the price scores. The committee’s scores

and the procurement officer’s scores were then added together, and because McKinley

had the highest score, it was awarded the lease.

B. Proceedings

In 2002, Bachner filed bid protests alleging irregularities in the bid scoring

process.2 Madson, the committee chairman, denied the protests and refused to stay the

award. Bachner appealed. On appeal, a hearing officer found “grave deficiencies” in

four of the five evaluations by procurement committee members and awarded Bachner

its bid preparation costs.3 Ultimately, we affirmed the hearing officer’s

recommendation.4

In 2004, Bachner filed a separate suit against four procurement committee

members as individuals.5 Bachner’s complaint asserted a claim for intentional

interference with prospective economic opportunity, alleging that the procurement

committee members failed to follow the required procedure for scoring bids.6 Bachner

also asserted a due process claim against state officers, alleging deprivation of the right

to contract under 28 U.S.C. § 1983. The complaint alleged that: (1) Senkow and Bennett

2

Id.; State, Dep’t of Admin. v. Bachner Co., 167 P.3d 58, 60 (Alaska

2007).

3

Weed, 230 P.3d at 698.

4

Bachner Co., 167 P.3d at 62.

5

Weed, 230 P.3d at 699.

6

Id.

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acted in bad faith by considering the site location even though it was not a permissible

evaluation criterion; (2) Senkow and Bennett acted in bad faith by refusing to adjust their

scores when Madson advised them that they could not consider the site location;

(3) Weed acted in bad faith by lowering his score of Bachner’s bid because he thought

other committee members were biased in favor of Bachner; and (4) Madson acted in bad

faith by refusing to stay the contract award during Bachner’s bid protest.

The committee members moved to dismiss, arguing that: (1) Bachner’s

claims were barred by the exclusive remedy provisions of AS 36.30.690; (2) the

committee members were entitled to absolute immunity; and (3) Bachner failed to state

a § 1983 claim.

The superior court dismissed Bachner’s § 1983 claim for failure to state a

claim, but the superior court refused to dismiss Bachner’s state-law claim because it

found that Bachner’s allegations of bad faith, if proven, would fall outside the scope of

qualified immunity.7 We granted the committee members’ petition for discretionary

review and affirmed the superior court’s holding that the committee members were

entitled to qualified immunity but not absolute immunity.8

On remand, the committee members reasserted their argument that

Bachner’s state-law claim was barred by the exclusive remedy statute, but the superior

court denied the motion, finding that the scope of the statute was co-extensive with

qualified immunity. After discovery, the committee members moved for summary

judgment, reasserting their exclusive remedy argument and arguing that they were

protected by qualified immunity because Bachner failed to offer admissible evidence that

could support an inference of bad faith. Bachner opposed and cross-moved for summary

7

Id.

8

Id. at 698-704.

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judgment, arguing that the committee members’ conduct demonstrated bad faith as a

matter of law.

In December 2011, the superior court denied both of Bachner’s motions and

granted the committee members’ motion for summary judgment based on qualified

immunity and the exclusive remedy statute. The court reasoned that Bachner presented

no genuine issue of material fact and that, as a matter of law, the committee members’

conduct could not be considered bad faith. Thus, the court held that qualified immunity

barred the suit.

The court also concluded that the exclusive remedy statute barred the suit,

but the court did not address whether the exclusive remedy provision extends to bad faith

conduct. Bachner moved for reconsideration and moved to supplement the record with

an affidavit, but the court denied both motions. The court found the committee members

were the prevailing parties and awarded the State $93,871.85 in fees and costs. Bachner

appeals.

III. STANDARD OF REVIEW

We review a grant of summary judgment de novo, “reading the record in

the light most favorable to the non-moving party and making all reasonable inferences

in its favor.” 9 “Summary judgment is only appropriate when there is no genuine issue

of material fact, and the moving party is entitled to judgment as a matter of law.”10 “The

party opposing summary judgment must set forth specific facts showing genuine issues

9

Witt v. State, Dep’t of Corr., 75 P.3d 1030, 1033 (Alaska 2003) (citing

Spindle v. Sisters of Providence in Wash., 61 P.3d 431, 436 (Alaska 2002)); Alaska Civil

Liberties Union v. State, 122 P.3d 781, 785 (Alaska 2005) (citing City of Kodiak v.

Samaniego, 83 P.3d 1077, 1082 (Alaska 2004); Powell v. Tanner, 59 P.3d 246, 248

(Alaska 2002)).

10

Alaska Civil Liberties Union, 122 P.3d at 785 (citing Odsather v.

Richardson, 96 P.3d 521, 523 n.2 (Alaska 2004)).

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and cannot rest on mere allegations; moreover, such facts must arise from admissible

evidence.”11 “To determine whether the nonmoving party can produce admissible

evidence creating a genuine factual dispute, we will consider the affidavits, depositions,

admissions, answers to interrogatories and similar material.”12

The proper interpretation of a statute presents a question of law that we

review de novo, “adopting the rule of law most persuasive in light of precedent, reason,

and policy.”13

“A trial court’s award of attorney’s fees is generally reviewed for abuse of

discretion.”14 “An abuse of discretion exists if an award is ‘arbitrary, capricious,

manifestly unreasonable, or the result of an improper motive.’ ”15 The trial court’s

application of law in awarding attorney’s fees is reviewed de novo.16

IV. DISCUSSION

A. The Superior Court Was Not Bound By Findings From Previous

Administrative Proceedings.

11

Witt, 75 P.3d at 1033 (quoting Braun v. Alaska Commercial Fishing &

Agric. Bank, 816 P.2d 140, 144 (Alaska 1991); Brady v. State, 965 P.2d 1, 8 (Alaska

1998) (internal quotation marks omitted)).

12

Schug v. Moore, 233 P.3d 1114, 1116 (Alaska 2010) (quoting Charles v.

Interior Reg’l Hous. Auth., 55 P.3d 57, 59 (Alaska 2002)).

13

L.D.G., Inc. v. Brown, 211 P.3d 1110, 1118 (Alaska 2009).

14

Krone v. State, Dep’t of Health & Soc. Servs., 222 P.3d 250, 252 (Alaska

2009) (citing Kellis v. Crites, 20 P.3d 1112, 1113 (Alaska 2001)).

15

Id. (quoting Reid v. Williams, 964 P.2d 453, 460 n.17 (Alaska 1998)).

16

Id. (citing Glamann v. Kirk, 29 P.3d 255, 259 (Alaska 2001)).

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The superior court, citing State, Department of Health & Social Services

v. Doherty,17 held that the findings from Bachner’s previous administrative appeal could

not be used against the committee members to create a genuine issue of material fact.

On appeal, Bachner asserts that collateral estoppel should bar the committee members

from challenging findings from the administrative appeal because the committee

members are in privity with the State of Alaska and their legal claims are identical. The

committee members respond that they are not in privity with the State.

Collateral estoppel prohibits a party from relitigating an issue of fact if:

(1) the party against whom the preclusion is employed was a

party to or in privity with a party to the first action; (2) the

issue precluded from relitigation is identical to the issue

decided in the first action; (3) the issue was resolved in the

first action by a final judgment on the merits; and (4) the

determination of the issue was essential to the final

judgment.[18]

In Doherty, the element of privity was also the basis for denying collateral

estoppel. Doherty involved a § 1983 claim against an Office of Children’s Services

social worker.19 The appellants argued that the official was in privity with OCS because:

(1) the official’s conduct was the central issue in the prior case; (2) the official had notice

and an opportunity to be heard on the issues; (3) the official attended the trial and

testified; (4) many of the prior case’s factual findings were based upon evidence

presented by the official; and (5) the official controlled the presentation of evidence.20

17

167 P.3d 64 (Alaska 2007).

18

Id. at 71 (quoting Powers v. United Serv. Auto. Ass’n, 6 P.3d 294, 297

(Alaska 2000)).

19

Id. at 66-68.

20

Id. at 72.

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However, in Doherty we recognized that, generally “employees acting in

their personal capacities are not in privity with the government and are not bound by

adverse determinations against the government.”21 We explained:

[A] non-party will be found to have been in privity with a

party to a prior legal proceeding only if that non-party

“(1) substantially participated in the control of a party’s

presentation in the adjudication or had an opportunity to do

so; (2) agreed to be bound by the adjudication between the

parties; or (3) was represented by a party in a capacity such

as trustee, agent, or executor.”[22]

We concluded that the fact that the social worker testified and presented evidence did

not mean that the social worker “had control over the litigation or the ability to pursue

her personal interests.”23 And the social worker “did not agree to be bound by the

adjudication and was not represented by a party in a capacity such as trustee.”24 Thus,

the social worker was “not afforded a full and fair opportunity to litigate the issues of

fact.”25

Here, Bachner argues that the committee members are in privity with the

State because: (1) the bid protests focused on the committee members’ allegedly illegal

actions; (2) the committee members had notice, an opportunity to be heard, and

procedures protecting their interests in the administrative proceeding; (3) the Attorney

General adequately represented their interests; (4) Madson defended the committee

21

Id. at 73.

22

Id. (quoting Powers, 6 P.3d at 298).

23

Id.

24

Id.

25

Id.

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members’ actions during the hearing; and (5) Weed was advised to seek independent

legal counsel.

Bachner’s arguments are very similar to the arguments in Doherty.26

Bachner attempts to distinguish Doherty on grounds that Weed was advised to seek

independent counsel. But this distinction does not present a sufficient reason to deviate

from the principle that committee members acting in their personal capacities are not in

privity with the government. In this case, the committee members were not parties to the

bid protest proceeding; they did not control the litigation; they did not agree to be bound

by its outcome; and they were not represented by counsel. We conclude that the

committee members were not in privity with the State for the purpose of collateral

estoppel, and that the superior court was therefore not bound by findings from the

administrative proceeding.

B. The Committee Members Are Protected By Qualified Immunity.

The procurement process requires procurement officers to exercise

independent judgment and avoid conflicts of interest. Procurement officers are

encouraged to utilize their knowledge and experience and to discuss bids with each other

during the process. We have held that qualified immunity protects procurement officials

in the exercise of these duties.27

“Under a rule of qualified immunity, a public official is shielded from

liability . . . when discretionary acts within the scope of the official’s authority are done

in good faith and are not malicious or corrupt.”28 Thus, “ ‘malice, bad faith or corrupt

26

See id. at 72.

27

See Weed v. Bachner Co., 230 P.3d 697, 703-04 (Alaska 2010).

28

Id. at 700 (quoting Aspen Exploration Corp. v. Sheffield, 739 P.2d 150, 158

(Alaska 1987)).

-9- 6848

motive transforms an otherwise immune act into one from which liability may ensue.’ ”29

Qualified immunity “ ‘protect[s] the honest officer who tries to do his duty,’ ” but it does

not protect “malicious, corrupt, and otherwise outrageous conduct.”30 When committee

members raise qualified immunity as a defense and testify that they acted in good faith,

the committee members are entitled to judgment as a matter of law unless the plaintiffs

can present some admissible evidence that creates an issue of fact as to whether the

committee members acted in bad faith or with an evil motive.31

For example, in Smith v. Stafford, we held that the plaintiff’s affidavit

“contain[ed] assertions indicating that a genuine issue of material fact exists concerning

[the defendant’s] state of mind with regard to the [plaintiff’s claims].”32 The plaintiff

stated that the social worker defendant falsified evidence and threatened the plaintiff.33

We held that “[t]he statements in the affidavit, if true, indicate that [the social worker]

may have been acting in bad faith.”34

Similarly, in J & S Services, Inc. v. Tomter, the plaintiff alleged that a

procurement official, “motivated by animosity against [the plaintiff] and a desire for

personal financial gain, abused his position as a participant in the procurement process

29

Id. (quoting Aspen Exploration, 739 P.2d at 158).

30

Id.

31

Smith v. Stafford, 189 P.3d 1065, 1074 (Alaska 2008) (citations omitted);

see Bauman v. State, Div. of Family & Youth Servs., 768 P.2d 1097, 1100 (Alaska 1989).

32

189 P.3d at 1074.

33

Id.

34

Id. at 1075.

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to prevent [the plaintiff] from forming a contract with the state.” 35 We held that the

plaintiff had stated a cause of action sufficient to defeat a motion to dismiss.36

Bachner’s claim for intentional interference with prospective economic

opportunity alleged that the committee members acted in bad faith. In response, the

committee members claimed qualified immunity and submitted affidavits stating that

they acted in good faith. The superior court viewed Bachner’s evidence in the light most

favorable to Bachner and drew all reasonable inferences in Bachner’s favor. The court

found that Bachner failed to present a genuine issue of material fact and that, as a matter

of law, the committee members’ conduct could not be considered bad faith.

We address each of Bachner’s arguments in turn.

1. The proximity issue

The Request for Proposals (RFP) and the RFP Evaluator’s Guide for this

project required the committee to evaluate, among other things, public convenience,

including “location with other state agencies.” Before the superior court, Bachner argued

that Bennett and Senkow considered proximity to other state agencies in bad faith

because they are both “long time DOT employees who wanted a new facility as close to

the DOT headquarters . . . as possible.” Bachner argued that Madson told Bennett and

Senkow that proximity to existing facilities was an impermissible criterion, but Bennett

and Senkow ignored her and “recruited Weed into their conspiracy” to award the contract

to McKinley. Bachner also claimed that Madson told the bidders at a pre-bid conference

that proximity to the DOT site would not be considered.

35

139 P.3d 544, 551 (Alaska 2006) (citing Kelley Prop. Dev., Inc. v. Town of

Lebanon, 627 A.2d 909, 910, 923 n.30 (Conn. 1993); Conway Corp. v. Constr. Eng’rs,

Inc., 782 S.W.2d 36, 40-41 (Ark. 1989)).

36

Id.

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The superior court noted that “location with other state agencies” was a

published criterion in the RFP guide and observed that all parties agreed that adherence

to the written criteria in the RFP guide was important. The superior court concluded,

“Without some evidence suggesting the actions of the [committee] members were in fact

wrongful on some level, the court cannot find bad faith.”

On appeal, Bachner makes the same arguments. Bachner quotes the

affidavit of Tom Roberts, a realtor who attended the pre-bid conference. Roberts stated

that Madson told the bidders that proximity to DOT would not be considered and that it

was not a published criterion.

Bachner does not appear to argue that any oral statements at the prebid

conference actually modified the written terms of the RFP.37 As noted above, the RFP

lists “location with other state agencies” as part of the “public convenience” factor. DOT

is a state agency, and the committee members properly considered proximity to the DOT

facility in the scoring process. We affirm the superior court’s holding that consideration

of a written RFP criterion generally cannot support an inference of bad faith.

2. The public transportation issue

The RFP required all proposed buildings to have regularly scheduled bus

service and a bus stop within 720 feet of a building entrance. A bid from Fountainhead

Development was declared non-responsive because it included no plans to secure bus

service. The McKinley proposal included a compliant bus stop, but the McKinley bus

stop did not have bus service at the time of the proposal.

During a committee meeting, Madson (in the presence of Bennett and

Senkow and another committee member) called the Fairbanks Bus Authority and spoke

37

Cf. Neal & Co. v. Ass’n of Vill. Council Presidents Reg’l Hous. Auth., 895

P.2d 497, 504-05 (Alaska 1995) (oral representations at a prebid conference did not alter

the written terms of a construction contract).

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with acting Transportation Director Glenn Miller to determine whether bus service was

available at the McKinley building. Miller apparently said that bus service could be

provided if certain conditions were met. After that conversation, Madson advised Chief

Procurement Officer Vern Jones that service was available and asked Jones if the

McKinley proposal complied with the public transportation requirement. Jones

confirmed that the McKinley proposal met the public transportation requirement.

Madson subsequently received a letter from Transportation Director Max Lyon, stating

that Fairbanks Bus Authority would make a regularly scheduled stop near the McKinley

building if McKinley received the contract.

Before the superior court, Bachner claimed that the committee members

wrongfully determined that the McKinley proposal met the public transportation

requirement. Bachner argued that Miller's affidavit established that he told the

committee that bus service “could” be provided if certain conditions were met, whereas

Madson told Jones that bus service “would” be provided. In response, the committee

members argued that: (1) the McKinley proposal included a bus stop; (2) the Committee

called Miller, who told the Committee that service could be provided; (3) Jones advised

Madson that the McKinley proposal met the public transportation requirement; and

(4) the committee members swore that they acted in good faith.

The superior court concluded that, at best, Bachner’s evidence established

that the committee members incorrectly or imprecisely reported Miller’s statements to

Jones and incorrectly concluded that McKinley’s proposal met the public transportation

requirement. The superior court quoted Prentzel v. State, Department of Public Safety,

where we said:

[B]efore malice can become a disputed question of fact, the

record must contain at least some objective evidence

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establishing facts capable of supporting an inference of

malice.[38]

Citing Prentzel and Pauley v. Anchorage School District,39 the superior court explained

that an incorrect or inappropriate action does not raise an inference of malice or bad faith.

The court noted that these committee members took steps to do their jobs correctly,

applied identical criteria to the Fountainhead Development bid, and took notes in an

attempt to document their efforts.

On appeal, Bachner again points to Miller’s affidavit and argues that the

committee members acted in bad faith when determining that the McKinley proposal

complied with the bus service requirement. The committee members respond that, at

best, Miller’s affidavit establishes that “Madson imprecisely reported the details of her

conversation to Vern Jones, misunderstood the nature of the city’s bus service

assurances, and/or negligently failed to ensure that the McKinley proposal met the public

transportation requirement of the RFP,” but it does not establish that Madson acted with

an evil or a corrupt motive.

The committee members assert that Madson reasonably relied on the

McKinley site plan proposal which showed a bus stop near the entrance to the McKinley

building and a letter from Transportation Director Max Lyon to McKinley, which states:

Due to the number of residents that bus stop would benefit,

we would make a regular scheduled stop near your office

complex. If you are successful in securing a lease with the

Department of Transportation for your new building, we

would place a bus stop near the entrance of the Department of

Transportation and Public Facilities headquarters at 2301

Peger Road. This should meet your contractual requirements

with the State and would be implemented by the occupancy

date of your contract.

38

169 P.3d 573, 585 (Alaska 2007).

39

31 P.3d 1284, 1286 (Alaska 2001).

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(Emphasis added.) Further, Chief Procurement Officer Jones confirmed that McKinley’s

proposal met the requirement.

Given this evidence, we agree with the superior court’s conclusion that

Bachner failed to present a genuine issue of material fact regarding the public

transportation issue. Madson and the committee followed a fair process to determine

whether the McKinley proposal satisfied the RFP. They relied on the bus stop noted in

the McKinley proposal, their call to Miller at the Fairbanks North Star Borough, and their

discussion with Jones. Miller disputes the details of the call, but the letter from Lyons

confirms that the committee members were not acting in bad faith when they concluded

that the Borough could make public transportation available. We therefore affirm the

superior court’s decision on the public transportation issue.

3. The bid protest/refusal to stay issue

In March 2002, after consulting with Chief Procurement Officer Jones and

another state employee, Madson denied Bachner’s bid protests.40 On March 12, Madson

refused to stay the notice of award, stating that the current lease for the DOT building

would end September 30, 2002. On March 22, Madson stated that the current lease

expired on September 20, 2002.

Before the superior court, Bachner argued that Madson denied the bid

protests in bad faith. The superior court rejected this argument, explaining that at the

summary judgment stage malice cannot be a disputed question of fact, unless the record

contains some objective evidence that would support an inference of malice.

Bachner’s argument was based principally on Madson’s inconsistent

statements regarding the end date of the existing lease. Madson appears to have made

a mistake about the ending date for the lease when she denied a stay of the award during

Bachner’s bid protest appeals. But there is nothing in the record that indicates that this

40

See State, Dep’t of Admin. v. Bachner Co., 167 P.3d 58, 60 (Alaska 2007).

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mistake was made in bad faith. We therefore affirm the superior court’s decision on the

bid protest issue.

4. The Weed scoring issue

Before the superior court, Bachner claimed that Weed acted in bad faith by

lowering his score for the Bachner proposal in order to counteract Madson’s overly high

scores for Bachner. Furthermore, Bachner alleged that Weed told Jerry Bowers, the

principal owner of Bowers Investment, that he was opposed to the Bachner proposal

because if it won, Weed and his staff would have to spend the next 40 years split between

the ground floor and the basement in the Bachner building. And Bachner alleged that

Weed told Bowers that Bennett and Senkow had pressured him not to vote for the

Bachner proposal.

Weed’s affidavit states that after the first round of scoring he became aware

of the identity of the building described in the Bachner proposal and considered his

personal knowledge of that building. Weed and Chief Procurement Officer Jones stated

that the committee members may appropriately consider their personal knowledge and

vary their scores between rounds. Weed argued that his score change to remedy

perceived bias was a mistake in the scoring process and did not establish bad faith.

The superior court concluded that Weed may have placed “undue emphasis

on indoor environment” when Weed considered that his staff would be split between

basement and ground floors for the next 40 years. The court reasoned that Weed’s

attempt to correct the perceived bias of other committee members was a

misunderstanding of his role in the procurement process. The court compared the facts

to J & S Services, Inc. v. Tomter41 and concluded that the factual allegations did not

support an inference that Weed acted in bad faith.

41

139 P.3d 544, 548 (Alaska 2006).

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A claim of unfair scoring of a public bid proposal does not show bad faith

unless the misconduct is motivated by malice or personal interests.42 Bower’s affidavit

suggests that Weed “shuffled” his scores to offset what he perceived to be Madson’s

unfair favoritism toward the Bachner proposal, and that Weed was possibly motivated

to avoid getting poor office space for his staff in the Bachner building. But Weed’s

motivation to get the best office space was a public purpose, not a bad faith attempt to

pursue his personal interests. We therefore affirm the superior court’s decision on the

Weed scoring issue.

C. The Committee Members Are Also Protected By The Exclusive

Remedy Statute.

The exclusive remedy state statute provides: “Notwithstanding AS 44.77

or other law to the contrary, AS 36.30.560 - 36.30.699 and regulations adopted under

those sections provide the exclusive procedure for asserting a claim against an agency

arising in relation to a procurement under this chapter.”43 In Weed v. Bachner Co.,

Justice Fabe relied on this statute in her concurring opinion, explaining, “[c]laims against

procurement committee members in their individual capacity for performing usual and

proper duties might fairly be characterized as ‘claims against an agency’ even where bad

faith is alleged; they would thus be barred by the exclusive remedy provision.”44 The

superior court found that because Bachner had not presented a genuine issue of material

fact about bad faith and because the alleged conduct occurred within the scope of the

committee’s official duties, the exclusive remedy provision barred Bachner’s claims.

In this case, all of the committee members were acting within the scope of

their duties to review the RFP responses. Even Weed’s decision to “shuffle his scores”

42

See id. at 545.

43

AS 36.30.690 (emphasis added).

44

230 P.3d 697, 704 (Alaska 2010) (Fabe, J., concurring).

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was related to his official responsibility to identify the best proposal and not by any

personal motive or advantage. And as we explained above, Bachner presented no

genuine issue of material fact regarding bad faith acts by the committee members. We

therefore do not have occasion to consider whether the exclusive remedy provision bars

suits against individual committee members for bad faith acts done within the course and

scope of official duties.45 However, we hold that suits against individual procurement

officers for acts within the course and scope of their official duties can fairly be

characterized as “claims against an agency.” In this case, there is no dispute that the

committee members acted within the course and scope of their official duties. Therefore,

we affirm the superior court’s holding that the exclusive remedy provision bars

Bachner’s suit.

D. The Superior Court Did Not Abuse Its Discretion By Denying The

Motion For Reconsideration.

After the superior court’s grant of summary judgment, Bachner moved for

reconsideration and asked the court to consider Jerry Bower’s December 30, 2011

supplemental affidavit. Citing Civil Rule 77(k) and Katz v. Murphy,46 the superior court

reasoned that the Rule “does not allow the moving party to raise new grounds as a basis

for reconsideration” and denied both motions.

On appeal, Bachner argues that the superior court erred by refusing to

consider Bowers’s supplemental affidavit because the superior court’s initial decision

invented a new legal test by requiring affirmative proof of targeted animosity rather than

45

The committee members argue that a finding of bad faith “is not dispositive

of a ‘course and scope’ determination.” They argue that even if an official acts in bad

faith, the exclusive remedy provision bars bad faith claims against the official so long as

the official acts within the course and scope of official duties.

46

165 P.3d 649, 661 (Alaska 2007).

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inferential proof. Bachner claims that Bowers’s affidavit could have met the new legal

test.

The committee members argue that the superior court did not abuse its

discretion in refusing to consider Bowers’s affidavit because it is hearsay, in that it

recites excerpts of an informal interview with a witness, John Burns. The committee

members also argue that the affidavit was untimely because it was signed the day after

the court issued its summary judgment order. In the alternative, the committee members

argue that any error was harmless because Bowers’s affidavit would not have changed

the outcome.

Bachner’s claims that the superior court enunciated a new standard of

“targeted animosity” for qualified immunity is incorrect. The superior court described

bad faith variously as “targeted animosity,” “malice,” “corruption,” and “evil motive.”

In J & S Services, we described bad faith as open “animosity toward” the bidder.47

“Targeted animosity” is synonymous with this characterization. Thus, “targeted

animosity” is not a new statement of the bad faith mental state required to defeat

qualified immunity.

Generally, a motion for reconsideration cannot be based on new information

or arguments.48 The supplemental affidavit from Jerry Bowers was new information that

could have been submitted previously. Where a party has sufficient opportunity to

introduce evidence but waits until after the close of evidence, a superior court does not

abuse its discretion in refusing to consider the evidence. The court did not commit an

47

139 P.3d 544, 550-51 (Alaska 2006).

48

Alaska R. Civ. P. 77(k); see also Katz,165 P.3d at 661.

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abuse of discretion by applying the normal rule that this untimely information should not

be considered.49

E. The Superior Court Did Not Abuse Its Discretion In Awarding

Attorney’s Fees.

The court found the committee members were the prevailing parties and

awarded the State $93,871.85 in fees and costs under Alaska Civil Rules 79 and 82.

Bachner argues that the superior court should not have awarded fees because the

committee members were represented by State attorneys and did not personally incur any

legal costs. Bachner claims that the purpose of Rule 82 is to “partially compensate a

successful litigant for actual fees incurred.” This is incorrect. The purpose of Rule 82

is to “afford reasonable partial compensation for attorney’s fees to the winning civil

litigant.”50 The Rule does not “preclude a court from [awarding] fees greater than those

agreed to by an attorney charging no fees or lower than usual fees.”51 Thus, the Rule

does not limit awards to “actual fees incurred” as Bachner argues.52 And contrary to

49

See Yang v. Yoo, 812 P.2d 210, 217 (Alaska 1991) (citing Hutchins v.

Schwartz, 724 P.2d 1194, 1197 (Alaska 1986)); see also State, Dep’t of Natural Res. v.

Transamerica Premier Ins. Co., 856 P.2d 766, 776 (Alaska 1993) (striking down post­

trial affidavit). Cf. Totem Marine Tug & Barge, Inc. v. Alyeska Pipeline Serv. Co., 584

P.2d 15, 20 (Alaska 1978) (holding that superior court erred by refusing to consider

deposition where parties frequently referred to it, but failed to formally move to publish

the deposition).

50

Municipality of Anchorage v. Gentile, 922 P.2d 248, 264 (Alaska 1996)

(quoting Wise Mech. Contractors v. Bignell, 718 P.2d 971, 973 (Alaska 1986)).

51

Id. at 264 n.22 (citation omitted).

52

Further, the committee members correctly point out that adopting Bachner’s

proposed rule (that the State can never recover funds when it indemnifies its committee

members) would allow litigants to file frivolous suits against committee members in their

official capacity, thereby forcing the State to expend resources with no hope of

compensation.

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Bachner’s assertions, the amended final judgment nowhere names the State as a “party.”

Instead the court made the fees payable to the State. Fees are properly payable to the

State when it expends resources defending its committee members.53

Bachner also argues that fees should not have been awarded because the

State acted as “in-house counsel.” In response, the committee members correctly note

that attorney’s fees can be awarded for work performed by Attorney General’s Office

staff acting as in-house counsel.54 Even though the committee members were not in

privity with the State for the purpose of collateral estoppel, the question of attorney’s fees

is a separate one. Because State attorneys defended the committee members in their

individual capacities, it is proper to make any fee award payable directly to the State.

Finally, Bachner argues that it is a public interest litigant and therefore

protected from adverse fee awards. Again, the committee members correctly note that,

even if public interest litigants are protected from adverse fee awards under

AS 09.60.010(b)(3)(I), Bachner cannot be considered a public interest litigant due to its

significant financial interest in this case. We therefore affirm the superior court’s fee

award.

V. CONCLUSION

Bachner failed to present a genuine issue of material fact that the committee

acted in bad faith, and we conclude that the exclusive remedy statute bars Bachner’s

53

See Alpine Indus., Inc. v. Feyk, 22 P.3d 445, 447, 450 (Alaska 2001)

(affirming superior court’s award of attorney’s fees to the State for cost of defending

official).

54

Greater Anchorage Area Borough v. Sisters of Charity of House of

Providence, 573 P.2d 862, 863 (Alaska 1978) (“Nothing in [Cont’l Ins. Co. v. U.S. Fid.

& Guar. Co., 552 P.2d 1122, 1128 (Alaska 1976)] was intended to alter our long-

standing practice of awarding attorney’s fees to public entities who litigate chiefly, and

often entirely, through in-house counsel.”).

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claim. For these reasons, we AFFIRM the superior court’s grant of summary judgment

in favor of all committee members. We also affirm the superior court’s fee award.

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