Safeguard Base Operations, LLC v. United States

In the United States Court of Federal Claims

No. 18-1515C

Filed: October 25, 2018

Redacted Version Issued for Publication: November 5, 20181

* * * * * * * * * * * * * * * * ** *

SAFEGUARD BASE OPERATIONS, *

LLC, *

*

Protestor, *

*

v. * Post-Award Bid Protest; CICA Stay

* Override; Motion for Temporary

UNITED STATES, Restraining Order; Motion for

*

* Preliminary Injunction.

Defendant,

v. *

B&O JOINT VENTURE, LLC, *

Defendant-Intervenor. *

* * * * * * * * * * * * * * * * ** *

Alexander B. Ginsberg, Pillsbury Winthrop Shaw Pittman, LLP, McLean, VA, for

protestor. Of counsel was Alex D. Tomaszczuk, Pillsbury Winthrop Shaw Pittman, LLP,

McLean, VA, Aaron S. Ralph and Kevin R. Massoudi, Pillsbury Winthrop Shaw Pittman,

LLP, Los Angeles, CA, and Diana Parks Curran and Hadeel Masseoud, Curran Legal

Services, Johns Creek, GA.

P. Davis Oliver, Senior Trial Attorney, Commercial Litigation Branch, Civil

Division, United States Department of Justice, Washington, D.C., for defendant. With him

were Douglas K. Mickle, Assistant Director, Commercial Litigation Branch, Robert E.

Kirschman, Jr., Director, Commercial Litigation Branch, and Joseph H. Hunt, Assistant

Attorney General. Of counsel was James C. Caine, Attorney, Federal Law Enforcement

Training Centers, Glynco, GA.

1 This Opinion was issued under seal on October 25, 2018. The parties were asked to

propose redactions prior to public release of the Opinion. Defendant responded that

defendant “does not propose any redactions to the Court’s sealed opinion.” Defendant-

intervenor proposed to redact information defendant-intervenor identified as its

“proprietary pricing.” Protestor proposed to redact several types of non-public information,

which protestor asserts to be confidential and exempt from public disclosure. This opinion

is issued with all of the redactions that the parties proposed in response to the court’s

request. Words which are redacted are reflected with the notation: “[redacted].”

Richard W. Arnholt, Bass, Berry & Sims PLC, Washington, D.C., for defendant-

intervenor. Of counsel was Todd R. Overman, Bass, Berry & Sims PLC, Washington,

D.C.

OPINION

HORN, J.

Before the court is protestor’s second motion for a temporary restraining order and

preliminary injunction, in which protestor challenges the decision of the United States

Department of Homeland Security (DHS), Federal Law Enforcement Training Centers

(the Agency), to override the automatic stay of performance required by the Competition

in Contracting Act (CICA), 31 U.S.C. § 3553 (2012), upon protestor’s filing of a bid protest

at the United States Government Accountability Office (GAO).

In protestor’s October 3, 2018 amended complaint, Safeguard Base Operations,

LLC (Safeguard), a joint venture which is the protestor in the above-captioned bid protest,

states in its amended complaint that the Safeguard joint venture is an “unpopulated joint

venture” consisting of Safeguard Security Operations, LLC (SSL) and SRM Group, Inc.

(SRM Group). According to an October 9, 2018 declaration signed by Michael D. Randall,

who states that he is the CEO of SSL, SSL is the fifty-one percent owner of Safeguard

joint venture, and SRM Group is the forty-nine percent owner of the Safeguard joint

venture.

On June 28, 2012, the Agency awarded Contract No. HSFLGL-12-C-00006 to

SRM Group (the SRM Group Contract). Safeguard indicates in its amended complaint in

this court that the 2012 SRM Group Contract required SRM Group to provide “dormitory

maintenance” services at the Federal Law Enforcement Training Center in Glynco,

Georgia. The SRM Group Contract was set-aside for contractors qualified as part of the

Small Business Administration’s (SBA’s) 8(a) program.2 The SRM Group Contract had a

phase-in period of July 1 to July 15, 2012, and a base period of performance beginning

on July 16, 2012 and ending on September 30, 2012. The SRM Group Contract also

contained Federal Acquisition (FAR) § 52.217-9, which stated that “[t]he total duration of

this contract, including the exercise of any options under this clause, shall not exceed 60

months or 5 years.”3 (emphasis in original). According to protestor’s amended complaint

2 “The ‘8(a) program,’ named after Section 8(a) of the Small Business Act, permits the

government to award certain contracts exclusively to small businesses that are certified

as socially and economically disadvantaged.” Hugh B. McClean, The Diversity Rationale

for Affirmative Action in Military Contracting, 66 CATH. U. L. REV. 745, 746 (2017) (citing

15 U.S.C. § 637(a)(1)(B) (2012)).

3 As discussed below, if all option periods of performance in the 2012 SRM Group

Contract were exercised, the SRM Group Contract would have ended on June 30, 2017,

which is five years after performance under the SRM Group Contract began on July 1,

2012. The SRM Group Contract included FAR § 52.217-8, which permitted the Agency

2

and the Agency’s October 2, 2018 Determination and Findings,4 the SRM Group Contract

contained multiple option periods of performance, all of which were exercised by the

Agency. The Agency’s October 2, 2018 Determination and Findings indicates that the

SRM Group Contract, after the exercise of all option periods of performance, originally

was set to expire on June 30, 2017.

In the Agency’s October 2, 2018 Determination and Findings, Ms. Fowler states

that “FAR clause 52.217-8 Option to Extend Services[5] was in the contract and FLETC

[Federal Law Enforcement Training Center] exercised it.” On June 28, 2012, the Agency

issued a three-month extension under FAR § 52.217-8 to the SRM Group Contract, which

extended the SRM Group Contract to September 30, 2017. On September 7, 2017, the

Agency issued a second three-month extension under FAR § 52.217-8 to the SRM Group

Contract, which extended SRM Group’s performance to December 31, 2017. Defendant

and defendant-intervenor assert that the SRM Group Contract with the Agency was

completed on December 31, 2017, when the second three-month extension under FAR

§ 52.217-8 ended.

On October 11, 2017, the Agency issued Request for Proposal No. HSFLGL-17-

R-00001 (the Solicitation) as a “competitive 8(a) Set-Aside.” The Solicitation stated that

award would be made on a “best value” basis, and that the “period of performance of this

contract will be a base period of three (3) months and seven (7) 12-month option periods.”

Under a section titled “Solicitation General Information,” the Solicitation stated: “Pricing

Schedule and Periods of Performance (POP) Service dates for each CLIN [Contract Line

Item Number] are detailed in Section B. Note: Exceptions to line item structure in Section

B may result in a bid not considered for award.” (capitalization in original).

The Solicitation’s performance work statement stated that the Federal Law

Enforcement Center in Glynco, Georgia, is located on approximately 2,000 acres in

southeast Georgia and “is responsible for providing law enforcement officer training to

to extend the SRM Group Contract by six months to December 31, 2017 after the last

option period of performance ended on June 30, 2017.

4 As discussed below, on October 2, 2018, the Agency issued its Determination and

Findings in support of its decision to override the CICA stay in the above-captioned bid

protest. Robin D. Fowler, “Head of the Contracting Activity, Federal Law Enforcement

Training Centers (FLETC),” issued and signed the Agency’s October 2, 2018

Determination and Findings.

5 The version of FAR § 52.217-8 in the SRM Group Contract states:

The Government may require continued performance of any services within

the limits and at the rates specified in the contract. These rates may be

adjusted only as a result of revisions to prevailing labor rates provided by

the Secretary of Labor. The option provision may be exercised more than

once, but the total extension of performance hereunder shall not exceed 6

months.

3

over 95 Partner Organizations and is responsible for providing certain core instructional

law enforcement programs as well as a variety of support services.” The performance

work statement stated that the Glynco, Georgia, Federal Law Enforcement Training

Center “has lodging for approximately 2,093 occupants.” The performance work

statement also stated that:

The Contractor shall provide all labor, supplies, materials, equipment,

including safety and protective gear, repair parts, tools, equipment,

planning, scheduling and coordination, training, licenses, permits,

certificates, insurance, pre-employment screening, reports and files,

management, and supervision necessary to perform dormitory custodial,

desk clerk, locksmith, and maintenance services for nine (9) dormitories,

five (5) student centers, one (1) laundry center and other facilities as

described throughout the Performance Work Statement (PWS).

On November 2, 2017, the Agency completed a Justification and Approval

pursuant to FAR § 6.302-2 (2017), which “extend[ed]” SRM Group’s performance to June

30, 2018. Under FAR § 6.302-2, “[w]hen the agency’s need for the supplies or services

is of such an unusual and compelling urgency that the Government would be seriously

injured unless the agency is permitted to limit the number of sources from which it solicits

bids or proposals, full and open competition need not be provided for.” See FAR § 6.302-

2(a)(2). FAR § 6.302-2 applies when “(1) an unusual and compelling urgency precludes

full and open competition, and (2) delay in award of a contract would result in serious

injury, financial or other, to the Government.” See FAR § 6.302-2(b). The November 2,

2017 Justification and Approval indicated that the Agency was entering “into a six month

contract extension on a basis of other than full and open competition beyond the current

contract period” of SRM Group’s performance. The November 2, 2017 Justification and

Approval asserted that “Dorm Management Services are critical to sustain FLETC’s ability

to train the Federal Law Enforcement Officers. This contract extension will maintain

contract support until a new contract can be awarded.” The November 2, 2017

Justification and Approval also asserted that “[a] lapse in contract support would present

an unacceptable risk to FLETC. Should these critical services become unavailable, it

would have a major, negative impact on the ability of the FLETC to provide critical training

to approximately 95 federal agencies partnered with FLETC.” Defendant asserts that, on

December 31, 2017, “SRM’s contract was over” following the expiration of the two three-

month extensions pursuant to FAR § 52.217-8, and that the November 2, 2017

Justification and Approval, as well as the subsequent Justifications and Approvals

discussed below, did not extend the SRM Group Contract as awarded in 2012. Defendant

asserts:

Solely for the sake of administrative convenience, FLETC effectuated the

sole-source contract actions through “modifications” to SRM’s contract,

even though SRM’s contract had run its course and could not be extended

further after the exercise of the FAR 52.217-8 option. This “modifications”

approach avoided delays that would have been caused by certain pre-

award reviews, generation of new clauses (which could cause pricing

4

impacts), and the need to obtain a temporary waiver from the SBA for a new

award of an 8(a) approved program project to a non-8(a) firm.[6]

(internal references omitted).

According to Safeguard’s second motion for a temporary restraining order and a

preliminary injunction, on March 16, 2018, Safeguard submitted a timely proposal in

response to the Solicitation. On June 12, 2018, the DHS Office of Legislative Affairs

approved of an award under the Solicitation to B&O Joint Venture, LLC (B&O). On June

14, 2018, the Agency notified Safeguard that B&O was the apparent awardee under the

Solicitation.7 In the Agency’s Determination and Findings, Ms. Fowler states that, on June

18, 2018, Safeguard filed a size protest with the Small Business Administration (SBA).

Ms. Fowler also states that, on June 22, 2018, Safeguard filed a pre-award bid protest

with the GAO alleging that the Agency had “conducted an arbitrary and capricious

evaluation.” According to Ms. Fowler, “[a]s a result of these protest actions, FLETC issued

a one-month contract extension to the incumbent contractor, SRM Group, Inc., to

continue services through July 31, 2018.” Indeed, on June 22, 2018, the Agency had

issued a second Justification and Approval pursuant to FAR § 6.302-2 (2018) on the basis

of unusual and compelling urgency, which stated that the Agency was “extend[ing]” SRM

Group’s performance to July 31, 2018.

In the October 2, 2018 Determination and Findings, Ms. Fowler states that, on July

16, 2018, the Agency informed the GAO of its intent to take corrective action by having

the source selection authority reconsider the proposal evaluation results and render a

new award decision. Four days later, on July 20, 2018, Ms. Fowler states that the SBA

determined that the “apparent awardee” under the source selection authority’s first

proposal evaluation, B&O, “was a small business, and therefore was eligible for award.”

Ms. Fowler states that, “[a]t this time,” given the Agency’s voluntary corrective action in

response to Safeguard’s pre-award bid protest at the GAO, “it was necessary for FLETC

to issue another one-month contract extension to the incumbent contractor, SRM Group,

Inc., to continue services through August 31, 2018.” On July 27, 2018, the Agency, again,

issued a Justification and Approval pursuant to FAR § 6.302-2 on the basis of unusual

and compelling urgency, which indicated that the Agency was “extend[ing]” SRM Group’s

performance to August 31, 2018.

Safeguard and the Agency’s Determination and Findings state that, on August 7,

2018, the Agency notified Safeguard that the Agency had selected B&O for award under

the Solicitation. Safeguard asserts that:

On August 14, 2018, DHS sent Safeguard a written post-award debriefing,

which disclosed the following information concerning DHS’ evaluation of

Safeguard’s and B&O’s proposals:

6 Neither the Agency nor defendant cited to a regulation requiring “a temporary waiver

from the SBA for a new award of an 8(a) approved program project to a non-8(a) firm.”

7 B&O is the defendant-intervenor in the above-captioned bid protest.

5

[redacted]

Given the material price advantage of Safeguard’s proposal – despite DHS’

unexplained and irrational upward adjustments to Safeguard’s proposed

price of $[redacted] – Safeguard filed a protest (the “First Post-Award

Protest”) with the GAO, which docketed the protest as B-415588.4.

On August 28, 2018, the Agency sent a notice to the GAO stating:

The agency will take corrective action in response to the protest, and

therefore respectfully requests, that in accordance with its rules, the GAO

dismiss this protest. Specifically, in response to the protestor’s allegations,

the agency discovered that it made mistakes in the consideration of

protestor’s proposal. The agency will correct these errors in a new source

selection decision.

According to Safeguard, the GAO dismissed “the First Post-Award Protest as academic

on August 31, 2018.” In the Agency’s Determinations and Findings, Robin Fowler states

that the contracting officer “suspended performance on the new contract award and then

issued another one-month contract extension to the incumbent contract, SRM Group,

Inc., to continue services through September 30, 2018.” Ms. Fowler’s statement

references that, on August 29, 2018, the Agency issued a fourth Justification and

Approval pursuant to FAR § 6.302-2 on the basis of unusual and compelling urgency,

which stated that the Agency was “extend[ing]” SRM Group’s performance to September

30, 2018.

On September 20, 2018, the Agency sent a letter to Safeguard stating that

Safeguard’s “proposal for the subject solicitation was unsuccessful and that a proposal

revision will not be considered.” The September 20, 2018 letter indicated that “[o]nly one

award was made to” B&O, and that the “total estimated amount” “for the base period and

all options” was $77,734,857.02. According to Safeguard, “Safeguard’s proposed price of

$[redacted] remains over $[redacted] lower than B&O’s proposed price.” (emphasis in

original). The September 20, 2018 letter also stated that:

In general terms, Safeguard Base Operations’ (SBO) price proposal was

determined non-compliant because the price volume failed to include

government provided amounts for the Service Work Request CLINs, which

was required by Amendment 00003 to the solicitation. The government

response to Question Number 9 specifically stated:” [sic] A. For bidding

purposes please include the following “not-to-exceed” amounts in the

applicable CLIN:

CLIN AMOUNT CLIN AMOUNT CLIN AMOUNT

0007AA $124,688.00 3007AA $549,872.00 6007AA $636,546.00

0007AB $ 59,063.00 3007AB $260,466.00 6007AB 0

$301,522.00

6

1007AA $498,750.00 4007AA $577,366.00 7007AA $636,546.00

1007AB $236,250.00 4007AB $273,489.00 7007AB $301,522.00

2007AA $523,688.00 5007AA $606,234.00

2007AB $248,063.00 5007AB $287,163.00

The solicitation further specifically stated the following: “Exceptions to the

line item structure in Section B may result in a bid not considered for award.”

Therefore, Safeguard Base Operations LLC-JV is not eligible for award.

Because there is no other evaluation information to provide, this letter also

serves as your post-award debriefing in accordance with Federal

Acquisition Regulation 15.506.

On September 25, 2018, Safeguard filed a second post-award bid protest of the

Agency’s award under the Solicitation at the GAO. In its second post-award bid protest

at the GAO, Safeguard argues that “DHS conducted an unreasonable and disparate

pricing evaluation,” and that “DHS conducted a flawed best value trade-off.” In its second

motion for a temporary restraining order and preliminary injunction, Safeguard states that

the “GAO issued an Acknowledgment Package and Protective Order on September 26,

2018 indicating that an Agency Report is due by October 25, 2018. GAO’s decision on

the merits is scheduled to be issued by January 3, 2019.” (capitalization in original).

On September 27, 2018, Suresh S. Prabhu, President of SRM Group, sent an

email message to Sheryle Wood, a contracting officer with the DHS, attached to which

was SRM Group’s “Unsolicited Offer to Extend Services on the Housing Project at the

current rates for 1 or 3 months.” (capitalization in original). The attachment provides the

following two options to DHS: “Option 1: Extend Services by 1 month to go the end of

October 2018 at current rates (September 2018 rates) Option 2: Extend Services by 3

month to go the end of December 2018 at current rates (September 2018 rates).”

At 7:04 a.m. on September 28, 2018, contracting officer Sheryle Wood sent an

email message to Ralph Thomas, who appears to be an employee of SRM Group, stating

“[w]e will be holding a phase out/phase in meeting today at 9AM at Townhouse 398. This

will be a joint meeting between B&O JV, SRM Group, SSD, and PRO. Please plan on

attending.” In its second motion for a temporary restraining order and preliminary

injunction, Safeguard states:

On Friday, September 28, 2018, DHS notified SRM personnel that SRM’s

last day of performance would be Sunday, September 30, 2018, and that

DHS wanted all SRM property removed from FLETC premises by the

weekend of September 29, 2018 so that B&O could commence

performance of housing management support services at FLETC in SRM’s

place.

The next day, on September 29, 2018, James Caine, an attorney with DHS, sent

an email message to Diana Curran, who lists herself as of counsel for the protestor in the

7

above-captioned protest. Mr. Caine’s September 29, 2018 email message stated that

“[w]e received your CFC [United States Court of Federal Claims] pre-award filing notice[8]

on the Dormitory Maintenance contract and envision having a D&F [Determination and

Findings] to provide you and GAO as it is in progress and the team is working to complete

it this weekend.”

On September 30, 2018, Safeguard’s contract to provide dormitory maintenance

services to the Agency expired, and, on October 1, 2018, the Agency transitioned to

B&O’s dormitory maintenance services contract with the Agency. Safeguard submitted to

the court an October 2, 2018 declaration signed by Suresh S. Prabhu,9 who states that

he is the president of SRM Group, in which Mr. Prabhu describes what he considers to

be “the chaos at FLETC” during the Agency’s transition to B&O. According to the

subsequently filed October 2, 2018 declaration signed by Suresh S. Prabhu, “SRM

employed a Project Management team of [redacted] personnel subject to non-compete

clauses as part of their employment contract that prevents them from lawfully being

employed by the currently performing contractor for housing services at FLETC, B&O.”

Safeguard asserts that the Agency’s transition to B&O has “left in place most, if not all, of

SRM’s non-senior incumbent employees.”

On October 1, 2018, Safeguard filed its complaint with this court in the above-

captioned bid protest, which challenged the Agency’s override of the CICA stay while

Safeguard’s second post-award bid protest was pending at the GAO. Safeguard filed a

motion for a temporary restraining order and preliminary injunction that same day. Also

on the same day, October 1, 2018, the court held a hearing with the parties in the above-

captioned bid protest. During the hearing, the court denied Safeguard’s motion for a

temporary restraining order and preliminary injunction, subject to protestor’s renewal, if

appropriate. At the October 1, 2018 hearing, counsel of record for defendant indicated

that the Agency was currently working on finalizing a Determination and Findings to

support its decision to override the CICA stay and that the Agency anticipated issuing the

Determination and Findings by 10:30 a.m., EDT, on October 2, 2018.

On the morning of October 2, 2018, Robin D. Fowler, “Head of the Contracting

Activity, Federal Law Enforcement Training Centers,” issued a Determination and

Findings stating that:

Upon the basis of the following findings, I, Robin D. Fowler, Head of the

Contracting Activity, Federal Law Enforcement Training Centers (FLETC),

have determined that performance of the contract for Dorm Management

Services in support of FLETC Glynco is authorized to proceed in the face

of a Government Accountability Office (GAO) protest (B-415588) filed by

8Safeguard submitted its pre-filing notice to the United States Court of Federal Claims

on the evening of September 28, 2018.

9Safeguard has submitted to the court three declarations signed by Suresh S. Prahbu.

The first declaration is dated September 28, 2018, the second declaration is dated

October 2, 2018, and the third declaration is dated October 13, 2018.

8

Safeguard Base Operations, LLC (SBO) as continuing performance is both

based upon urgent and compelling circumstances that affect the interests

of the United States and that it is also in the best interests of the United

States.

(emphasis in original).

According to Ms. Fowler, Safeguard’s second post-award bid protest at the GAO

contains the two following allegations: 1) that the Agency conducted an unreasonable

and disparate pricing evaluation; and 2) that the Agency conducted a flawed best value

trade-off. Regarding the first allegation, Ms. Fowler alleges that Safeguard, in its proposal

in response to the Solicitation, failed to price a series of Contract Item Line Numbers

(CLINs) “in the amount of $6.1M as specifically directed by the solicitation, as amended.”

Ms. Fowler states that Safeguard’s failure to price the CLINs “rendered their price

proposal non-compliant as offerors were warned could happen.” Regarding Safeguard’s

allegation of a flawed best value trade-off, Ms. Fowler states that Safeguard’s “price

proposal was non-compliant and could not be compared to other prices in a trade-off

analysis. However, they were also not the highest technically evaluated offeror and the

SSA [source selection authority] determined the premium price that would be paid to the

highest rated offeror was the best value to the Government.” Ms. Fowler states that, when

making his decision to override the CICA stay, she consulted with James Caine, “FLETC’s

procurement attorney,” “regarding the merits of the protest that triggered the CICA stay.”

According to Ms. Fowler, based on Mr. Caine’s review of Safeguard’s second post-award

bid protest at the GAO, the Agency’s “position appears to be defensible and well

supported by law and fact.” Ms. Fowler also asserts that, “[e]ven if GAO were to sustain

the protest, however, the interests at risk from delay are so great that they overcome the

risks to the Agency of an adverse ruling by the GAO.”

Under a heading in the Determination and Findings titled “Existing Contract and

Protest,” Ms. Fowler states that the Federal Law Enforcement Training Center “prepares

the federal law enforcement community to safeguard the American people, our homeland,

and our values by providing basic and advanced law enforcement training to more than

ninety-five Federal Partner Organizations.” (capitalization in original). Ms. Fowler asserts

that a “critical part of this training mission is lodging our law enforcement students,” and

that the Federal Law Enforcement Training Center in Glynco, Georgia, currently has nine

on-site dormitories with over 2,000 rooms. Ms. Fowler states, “[a]t this time, there is no

existing contract with the incumbent that may be extended, they have ended the period

of performance of the last extension, and FLETC has fully transitioned to performance by

the awardee.” According to Ms. Fowler, the Agency

cannot do without these services without jeopardizing FLETC’s ability to

train Federal law enforcement officers, including Custom and Border Patrol

and Immigration and Customs Enforcement officer, as well as

Transportation Security Administration airport screeners and could

ultimately impact the ability of our partner organizations to field qualified law

enforcement agents and screeners.

9

Ms. Fowler also states:

In August, 2018, I learned from counsel, that the interested party’s attorneys

had objected to and expressed concern that the bridge contracts that

FLETC executed to obtain services during the protest, were obtained from

a contractor who was not in the 8A program and the acquisition was in the

8A program. Although, a standard practice at FLETC during protests was

awarding bridge contracts to the incumbent, I realized that this was not a

good practice in this case, and was contrary to my obligation to comply with

and fully support the Small Business Administration’s 8A program. This lead

to my decision to not award a new bridge contract to any contractor outside

the 8A program. It takes a total of five days to complete the congressional

notification process required for new awards in excess of one million dollars.

Thus, it was impossible to prepare and award a bridge contract to the

awardee for just the 120-day period required to complete the GAO protest

process in time to avoid doing without these services and jeopardizing

training. Therefore, I had no choice but to override the Stay to ensure

continued performance.

Under a heading in the October 2, 2018 Determination and Findings titled “Basis

for the Stay Override,” Ms. Fowler addresses the Agency’s asserted multiple reasons for

overriding the CICA stay, which include overriding the CICA stay because of urgent and

compelling circumstances and because the override is in the best interests of the United

States. Ms. Fowler alleges that there are “Urgent and Compelling circumstances that

significantly affect the interests of the United States that will not permit waiting for

the GAO decision on the merits of the protest [Safeguard’s second post-award bid

protest at the GAO].” (emphasis in original). Ms. Fowler asserts that “[e]ach extension

has been a separate contract action supported by a Justification and Approval (J&A)

authorizing the continuation of services under the status quo requirements.” Ms. Fowler

argues that SRM Group “is no longer an 8(a) contractor, having graduated approximately

two years ago,” and, “[t]herefore, it is no longer feasible or proper to continue services

under the current contract to a contractor who is not even an 8A contractor.” Ms. Fowler

states that “the only other option vice an override is to forego these vital services

throughout the GAO protest period.” When addressing the alleged urgent and compelling

circumstances, Ms. Fowler asserts:

The impacts, as described in the [October 1, 2018] affidavit of Thomas J.

Walters, Director of FLETC, would be as follows:

1) Adversely impact FLETC training operations and could potentially

lead to classes being cancelled due to lodging disruption;

2) Could cause training to be unaffordable for our Partner Organizations

as we would attempt to use off-center lodging and it would be much

more expensive, and in some cases the Director believes they would

pull students from training as it would be unaffordable;

10

3) Due to upcoming CBP and ICE surge any disruption to lodging at a

time when we are looking for greater lodging capacity by double bunking

and more aggressive commercial lodging could jeopardize ability to

meet the requirements of the surge;

4) FLETC has limited staff and equipment resources and it is not clear

we could adequately clean common areas, issue keys, and maintain the

buildings adequate to meet health and safety needs which may well

result in the loss of the use of these dormitories even if we required

students to clean their own linens and rooms. Taking these steps would

negatively impact training as our training program is demanding, and

does not have student time included in the training schedule for room

and linen cleaning.

Additionally, in the October 1, 2018 affidavit signed by Thomas J. Walters, “Director of

FLETC,” Mr. Walters states that:

FLETC has begun planning efforts to meet the anticipated surge in training

that CBP and ICE will require to meet the hiring goals associated with

Executive Order 13767, Border Security and Immigration Enforcement

Improvements, and Executive Order 13768, Enhancing Public Safety in the

Interior of the United States. To meet the intents of these Executive Orders,

CBP will hire 5,000 Border Patrol Agents and ICE will hire 10,000

Immigration Officers; FLETC will be responsible for training almost all of

them.

(emphasis in original).

Ms. Fowler also asserts that “[c]ontinued performance is in the Best Interests

of the United States.” (emphasis and capitalization in original). Ms. Fowler states:

The corrective actions over the past 3 months have resulted in a monthly

contract extension to the incumbent contractor. The first extension resulted

in an 11% increase over previous prices, which equals to $104,494.15. The

second extension resulted in an additional 7.5% increase, which equals

$20,125.99. Then finally, the third extension resulted in an additional 6%

increase, which equals $30,682.44. In total, FLETC is now paying in excess

of 26% over the original negotiated cost of these services, or $155,372.58

per month. The incumbent, SRM’s current monthly price is $325,979.12

over what we would be paying the awardee if the award were not

suspended as a result of the first protest, and would cause us to expend

close to $1.3 million for the period of the protest more than necessary, had

we continued performance with the incumbent. Thus it would fiscally

irresponsible to continue down this path, rather than continue services

under the newly awarded contract that was determined to offer the best

value to the government and not in the best interests of the Government.

11

Additionally, by overriding the stay of performance, the period of

performance is now long enough for the contractor to begin to implement

double-bunking in two dormitories, which is critical to resolving the shortage

of on-center lodging.

Finally, and most importantly, as stated previously, this is an 8(a)

designated service and the incumbent continuing to perform the work via a

bridge contract (extension) would go against the rules of the 8(a) program.

The awardee had demonstrated they are the most qualified 8A to perform

this work.

Following the Ms. Fowler’s discussion of urgent and compelling circumstances and the

best interests of the United States in the October 2, 2018 Determination and Findings,

under a heading titled “HARM – DAMAGES,” Ms. Fowler states that:

If the Stay of performance continues, the adverse effect could be

catastrophic and it is impossible to quantify the harm that could result from

Federal Law Enforcement Agencies fielding an inadequate number of

officers and airport screeners. However, FLETC’s Chief Financial Officer

informed me the impact of replacing on-center lodging with off-center

lodging, assuming adequate off-center lodging was even available, would

be approximately $20 million over the course of a 120-day extension.

(emphasis and capitalization in original).

The next day, on October 3, 2018, Safeguard filed an amended complaint

reasserting that the Agency’s decision to override the CICA stay was arbitrary and

capricious and contrary to law. In the amended complaint, Safeguard asserted that the

Agency’s October 2, 2018 Determination and Findings “relies almost exclusively on the

rationale deemed irrelevant to a CICA override decision.” Safeguard requests in its

amended complaint a declaration “that Defendant’s decision to override the CICA stay

issued in connection with Safeguard’s pending GAO protest award was arbitrary,

capricious and contrary to law,” a preliminary and permanent injunction, and “[s]uch

further relief as this Court deems just and proper.”

On October 4, 2018, Safeguard filed a second motion for a temporary restraining

order and preliminary injunction. In its October 4, 2018 motion, Safeguard argues that,

because neither of the Agency’s two “justifications is rational or defensible under the four-

factor test established by Reilly’s Wholesale Produce v. United States, 73 Fed. Cl. 705,

711 (2006), DHS’ override decision is arbitrary, capricious and contrary to law.” Safeguard

“respectfully requests that this Court declare DHS’ CICA stay override to be unjustified

and unlawful and enjoin DHS from proceeding with any further transition to or

performance by B&O during the pendency of Safeguard’s GAO protest.”

On October 15, 2018, defendant and defendant-intervenor filed responses to

Safeguard’s motion for a temporary restraining order and preliminary injunction.

12

Defendant and defendant-intervenor both assert that the Agency’s decision to override

the CICA stay implemented in connection with Safeguard’s second post-award bid protest

was rational, and that the court should not grant Safeguard’s second motion for a

temporary restraining order and preliminary injunction.

On October 16, 2018, defendant filed the administrative record in the above-

captioned protest. On October 17, 2018, the court heard oral argument regarding

Safeguard’s second motion for a temporary restraining order and preliminary injunction.

During the October 17, 2018 oral argument, the issue of whether Safeguard has standing

to challenge the Agency’s decision to override the CICA stay implemented in connection

with Safeguard’s second post-award bid protest at the GAO was discussed. Defendant,

for the first time, indicated that the government thought that Safeguard did not have

standing to maintain its challenge to the Agency’s override in the above-captioned bid

protest.

On October 18, 2018, the parties submitted supplemental filings to the court

addressing Safeguard’s standing. Safeguard argues that, “based on clear precedent from

this Court, Safeguard has standing in this CICA override challenge by mere virtue of its

status as an actual offeror and actual GAO protester in this procurement.” Defendant, in

its brief submission to the court, which was devoid of any serious analysis, concluded

that, “because SBO has failed to demonstrate that it has suffered an ‘injury-in-fact’ as a

result of FLETC’s override decision, SBO does not have standing to challenge that

decision.” Defendant-intervenor, in an equally brief and sparse filing, concluded simply

that “[i]ntervenor concurs with the Defendant that Plaintiff [protestor] does not have

standing.”

On October 24, 2018, the court issued an oral decision in a hearing with the parties.

This decision incorporates and memorializes the October 24, 2018 oral decision.

DISCUSSION

The Tucker Act grants the United States Court of Federal Claims

jurisdiction to render judgment on an action by an interested party objecting

to a solicitation by a Federal agency for bids or proposals for a proposed

contract or to a proposed award or the award of a contract or any alleged

violation of statute or regulation in connection with a procurement or a

proposed procurement.

28 U.S.C. § 1491(a)(1) (2012). In order to have standing to sue as an “interested party”

under this provision, a disappointed bidder must show that it suffered competitive injury

or was “prejudiced” by the alleged error in the procurement process. See Todd Constr.,

L.P. v. United States, 656 F.3d 1306, 1315 (Fed. Cir. 2011) (To prevail, a bid protester

must first “‘show that it was prejudiced by a significant error’ (i.e., ‘that but for the error, it

would have had a substantial chance of securing the contract).’” (quoting Labatt Food

Serv., Inc. v. United States, 577 F.3d 1375, 1378, 1380 (Fed. Cir. 2009))); see also Blue

13

& Gold Fleet, L.P. v. United States, 492 F.3d 1308, 1317 (Fed. Cir. 2007); Sci.

Applications Int’l Corp. v. United States, 108 Fed. Cl. 235, 281 (2012); Linc Gov’t Servs.,

LLC v. United States, 96 Fed. Cl. 672, 693 (2010) (“In order to establish standing to sue,

the plaintiff in a bid protest has always needed to demonstrate that it suffered competitive

injury, or ‘prejudice,’ as a result of the allegedly unlawful agency decisions.” (citing Rex

Serv. Corp. v. United States, 448 F.3d 1305, 1308 (Fed. Cir. 2006); Statistica, Inc. v.

Christopher, 102 F.3d 1577, 1580-81 (Fed. Cir. 1996); Vulcan Eng’g Co. v. United States,

16 Cl. Ct. 84, 88 (1988); and Morgan Bus. Assocs., Inc. v. United States, 223 Ct. Cl. 325,

332 (1980))). In order to establish what one Judge on this court has called “allegational

prejudice” for the purposes of standing, the bidder must show that there was a “substantial

chance” it would have received the contract award, but for the alleged procurement error.

See Linc Gov’t Servs., LLC v. United States, 96 Fed. Cl. at 675; Hyperion, Inc. v. United

States, 115 Fed. Cl. 541, 550 (2014) (“The government acknowledges that proving

prejudice for purposes of standing merely requires ‘allegational prejudice,’ as contrasted

to prejudice on the merits . . . .”); Bannum, Inc. v. United States, 115 Fed. Cl. 148, 153

(2014); see also Bannum, Inc. v. United States, 404 F.3d 1346, 1358 (Fed. Cir. 2005);

Galen Med. Assocs., Inc. v. United States, 369 F.3d 1324, 1331 (Fed. Cir.), reh’g denied

(Fed. Cir. 2004); Info. Tech. & Applications Corp. v. United States, 316 F.3d 1312, 1319

(Fed. Cir.), reh’g and reh’g en banc denied (Fed. Cir. 2003); Statistica, Inc. v. Christopher,

102 F.3d at 1581; Archura LLC v. United States, 112 Fed. Cl. 487, 497 (2013); Lab. Corp.

of Am. v. United States, 108 Fed. Cl. 549, 557 (2012). Because standing is a jurisdictional

issue, this showing of prejudice is a threshold issue. See Corus Grp. PLC. v. Int’l Trade

Comm’n, 352 F.3d 1351, 1357 (Fed. Cir. 2003); Myers Investigative & Sec. Servs., Inc.

v. United States, 275 F.3d 1366, 1370 (Fed. Cir. 2002).

In a post-award bid protest, such as the above-captioned bid protest, the “protestor

must ‘establish that it (1) is an actual or prospective bidder, and (2) possesses the

requisite direct economic interest.’” Mgmt. & Training Corp. v. United States, 137 Fed. Cl.

780, 783-84 (2018) (quoting Rex Serv. Corp. v. United States, 448 F.3d 1305, 1307 (Fed.

Cir. 2006)); see also Digitalis Educ. Sols., Inc. v. United States, 664 F.3d 1380, 1384

(Fed. Cir. 2012) (quoting MCI Telecomms. Corp. v. United States, 878 F.2d 362, 365

(Fed. Cir. 1989)); Timberline Helicopters, Inc. v. United States, No. 18-1474C, 2018 WL

4709765, at *2 (Fed. Cl. Oct. 2, 2018); Contract Servs., Inc. v. United States, 104 Fed.

Cl. 261, 269 (2012).

Although “standing is not often discussed at length in CICA stay override cases,”

see PMTech, Inc. v. United States, 95 Fed. Cl. 330, 348 (2010), several Judges on the

United States Court of Federal Claims have found that, by bidding on a procurement

which was stayed pending a protest at the GAO, a protestor has enough of a direct

economic interest in the stayed procurement and has standing to challenge an override

of the CICA stay in this court. See Supreme Foodservice GmbH v. United States, 109

Fed. Cl. 369, 381 (2013) (evaluating the standing of a protestor challenging an override

of the CICA stay and stating that, “[a]s an actual offeror challenging the award of a

contract before the GAO, there is no question that Supreme [the protestor] is an interested

party for purposes of our court’s jurisdiction”); URS Fed. Servs., Inc. v. United States, 102

Fed. Cl. 664, 670 (2011) (determining that a protestor had standing to challenge an

14

override of a CICA stay implemented in connection with a bid protest at the GAO when

the protestor had bid on the solicitation at issue at the GAO, notwithstanding that the

protestor was not the incumbent contractor), recons. denied, 102 Fed. Cl. 674 (2012);

PMTech, Inc. v. United States, 95 Fed. Cl. at 348; Sierra Military Health Servs., Inc. v.

United States, 58 Fed. Cl. 573, 579 (2003).

In the above-captioned bid protest, Safeguard submitted a proposal in response

to the Solicitation at issue in Safeguard’s second post-award bid protest at the GAO.

Pursuant to CICA, performance of the contract awarded to B&O following the Agency’s

evaluation of proposals received in response to the Solicitation was stayed until the

Agency decided to override the CICA stay. Therefore, Safeguard, as an actual offeror,

has a direct economic interest in the resultant contract issued under the Agency’s

Solicitation and has standing in the above-captioned bid protest to challenge the Agency’s

override of the CICA stay implemented when Safeguard filed its second post-award bid

protest at the GAO. See Supreme Foodservice GmbH v. United States, 109 Fed. Cl. at

381; URS Fed. Servs., Inc. v. United States, 102 Fed. Cl. at 670.

When evaluating a challenge to an agency’s decision to override an automatic

CICA stay, Judges of the United States Court of Federal Claims have differed on whether

the court should apply the test for injunctive relief or the test for a declaratory relief. See

Dyncorp Int’l LLC v. United States, 113 Fed. Cl. 298, 307 (2013) (“This is a topic on which

judges of this court have disagreed.” (citations omitted)); see also PMTech, Inc. v. United

States, 95 Fed. Cl. at 347 (“There is a split in the precedent of this court as to whether

declaratory relief or injunctive relief should be afforded the successful protestor of a CICA

stay override.”). When evaluating challenges to an override decision, certain judges on

the United States Court of Federal Claims have stated that utilizing the four-factor test for

injunctive relief is more appropriate than the test for a declaratory judgment. See Superior

Helicopter LLC v. United States, 78 Fed. Cl. 181, 194 (2007); see also Reilly’s Wholesale

Produce v. United States, 73 Fed. Cl. at 709 n.7. Other judges have indicated that

declaratory relief is more appropriate because allowing “an arbitrary override to insert the

injunctive relief requirements into the process would convert the CICA stay to something

other than what Congress created.” See Supreme Foodservice GmbH v. United States,

109 Fed. Cl. at 397; see also Intelligent Waves, LLC v. United States, 137 Fed. Cl. 623,

628 (2018) (“Because Congress provided the automatic stay as the default, it is not

necessary that additional criteria be met to reinstate a stay that has been overridden by

agency action.”); AT & T Corp. v. United States, 133 Fed. Cl. 550, 557 (2017); URS Fed.

Servs., Inc. v. United States, 102 Fed. Cl. 674, 676 (2012); Nortel Gov’t Sols., Inc. v.

United States, 84 Fed. Cl. 243, 252 (2008); Advanced Sys. Dev., Inc. v. United States,

72 Fed. Cl. 25, 36 (2006); CIGNA Gov’t Servs., LLC v. United States, 70 Fed. Cl. 100,

114 (2006); Chapman Law Firm Co. v. United States, 65 Fed. Cl. 422, 424 (2005).

In the above-captioned bid protest, protestor’s second motion for a temporary

restraining order and a preliminary injunction requests that this court issue a temporary

restraining order and a preliminary injunction. In protestor’s amended complaint, in

addition to requesting a preliminary injunction and a permanent injunction, protestor

requests a declaration “that Defendant’s decision to override the CICA stay issued in

15

connection with Safeguard’s pending GAO protest award was arbitrary, capricious and

contrary to law.” In a previous, unrelated bid protest challenging an agency’s decision to

override a stay, in which the protestor requested both declarative and injunctive relief, the

undersigned granted the protestor’s request for a declaratory judgment and stated that

“the override decision is set aside, and the automatic stay stemming from ATI’s [the

protestor’s] GAO protest is reinstated.” See Automation Techs., Inc. v. United States, 72

Fed. Cl. 723, 731 (2006). In a footnote, the undersigned stated that, “‘[b]ecause the

declaratory judgment will reinstate the stay and vacate the override, having the same

effect as an injunction, the Court does not reach the issue of injunctive relief.’” Id. at 731

n.5 (quoting CIGNA Gov’t Servs., LLC v. United States, 70 Fed. Cl. at 114). The court,

however, need not determine, at this time, which form of relief is more appropriate in the

above-captioned bid protest, because, as discussed below, the court finds that

Safeguard’s bid protest in this court is unlikely to succeed on the merits. See PMTech,

Inc. v. United States, 95 Fed. Cl. at 347 (“In a case where the record does not support a

finding that the agency’s decision is arbitrary or capricious, however, the distinction

between declaratory relief and injunctive relief is of little import.”). In the current protest,

Safeguard has requested injunctive relief and the court has analyzed this protest under

the more rigorous injunctive relief standard.

Regarding protestor’s request for a temporary restraining order and a preliminary

injunction, the granting of a temporary restraining order “is an ‘extraordinary and drastic

remedy,’” GEO Grp., Inc. v. United States, 100 Fed. Cl. 223, 226 (2011) (quoting Mazurek

v. Armstrong, 520 U.S. 968, 972 (1997)), as is the granting of a preliminary injunction.

See Silfab Solar, Inc. v. United States, 892 F.3d 1340, 1345 (Fed. Cir. 2018) (“A

preliminary injunction ‘is an extraordinary remedy.’” (quoting Winter v. Nat. Res. Def.

Council, 555 U.S. 7, 24 (2008)). “The standards for determining whether to grant a

temporary restraining order are the same as those that apply to a motion for a preliminary

injunction.” See Munilla Constr. Mgmt., LLC v. United States, 130 Fed. Cl. 131, 135

(2016); see also OAO Corp. v. United States, 49 Fed. Cl. 478, 480 (2001) (“When

deciding if a TRO [temporary restraining order] is appropriate in a particular case, a court

uses the same four-part test applied to motions for a preliminary injunction.” (quoting W

& D Ships Deck Works, Inc. v. United States, 39 Fed. Cl. 638, 647 (1997))).

To obtain a temporary restraining order or preliminary injunction, the protestor

must carry the burden of establishing entitlement to extraordinary relief based on the

following factors: (1) likelihood of success on the merits of the underlying litigation, (2)

whether irreparable harm is likely if the injunction is not granted, (3) the balance of

hardships as between the litigants, and (4) factors of the public interest. See Trebo Mfg.,

Inc. v. Firefly Equipment, LLC, 748 F.3d 1159, 1165 (Fed. Cir. 2014); see also Pharm.

Research and Mfrs. of Am. v. Walsh, 538 U.S. 644, 670 (2003) (requiring a movant for

preliminary injunction to prove that the “probability of success on the merits of its

claims . . . the risk of irreparable harm, the balance of the equities, and the public interest”

weigh in the movant’s favor); Silfab Solar, Inc. v. United States, 892 F.3d at 1345 (citing

Winter v. Nat. Res. Def. Council, 555 U.S. at 24); Abbott Labs. v. Sandoz, Inc., 544 F.3d

1341, 1344 (Fed. Cir. 2008) (citing Oakley, Inc. v. Sunglass Hut Int’l, 316 F.3d 1331,

1338-39 (Fed. Cir. 2003)), reh’g and reh’g en banc denied (Fed. Cir. 2009); Somerset

16

Pharms., Inc. v. Dudas, 500 F.3d 1344, 1346 (Fed. Cir. 2007) (“To establish entitlement

to a preliminary injunction a movant must establish a reasonable likelihood of success on

the merits.” (citing Nat’l Steel Car, Ltd. v. Canadian Pac. Ry., Ltd., 357 F.3d 1319, 1325

(Fed. Cir.), reh’g and reh’g en banc denied (Fed. Cir. 2004))); U.S. Ass’n of Imps. of

Textiles and Apparel v. U.S. Dep’t of Commerce, 413 F.3d 1344, 1346 (Fed. Cir. 2005)

(citing Zenith Radio Corp. v. United States, 710 F.2d 806, 809 (Fed. Cir. 1983)); Seaborn

Health Care, Inc. v. United States, 55 Fed. Cl. 520, 523-24 (2003); Dynacs Eng’g Co. v.

United States, 48 Fed. Cl. 614, 616 (2001).

The standard of proof required for a temporary restraining order and preliminary

injunction is a preponderance of the evidence, Contracting Consulting Eng’g LLC v.

United States, 103 Fed. Cl. 706, 709 (2012) (citing Bannum, Inc. v. United States, 60 Fed.

Cl. 718, 723-24 (2004)); Bannum, Inc. v. United States, 60 Fed. Cl. at 723-24, or,

demonstration of a fact as “more likely than not.” Tellabs, Inc. v. Makor Issues & Rights,

Ltd., 551 U.S. 308, 329 (2007) (citing Herman & MacLean v. Huddleston, 459 U.S. 375,

390 (1983)).

No one factor, taken individually, is necessarily dispositive. . . . [T]he

weakness of the showing regarding one factor may be overborne by the

strength of the others. If the injunction is denied, the absence of an

adequate showing with regard to any one factor may be sufficient, given the

weight or lack of it assigned the other factors.

FMC Corp. v. United States, 3 F.3d 424, 427 (Fed. Cir. 1993); see also Belgium v. United

States, 452 F.3d 1289, 1292-93 (Fed. Cir. 2006); SVD Stars II, LLC v. United States, 138

Fed. Cl. 483, 486 (2018); Loch Harbour Grp., Inc. v. United States, 128 Fed. Cl. 294, 300

(2016).

In the above-captioned bid protest, Safeguard is challenging the Agency’s decision

to override the CICA stay that was implemented in connection with Safeguard’s second

post-award bid protest at the GAO. The Administrative Dispute Resolution Act of 1996

(ADRA), Pub. L. No. 104-320, §§ 12(a), 12(b), 110 Stat. 3870, 3874 (1996) (codified at

28 U.S.C. § 1491(b)(1)–(4) (2012)), amended the Tucker Act to establish a statutory basis

for bid protests in the United States Court of Federal Claims. See Impresa Construzioni

Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1330-32 (Fed. Cir. 2001); see

also Sys. Application & Techs., Inc. v. United States, 691 F.3d 1374, 1380 (Fed. Cir.

2012) (explaining that the Tucker Act expressly waives sovereign immunity for claims

against the United States in bid protests). The statute provides that protests of agency

procurement decisions are to be reviewed under APA standards, making applicable the

standards outlined in Scanwell Labs., Inc. v. Shaffer, 424 F.2d 859 (D.C. Cir. 1970), and

the line of cases following that decision. See, e.g., Per Aarsleff A/S v. United States, 829

F.3d 1303, 1309 (Fed. Cir. 2016) (“Protests of agency procurement decisions are

reviewed under the standards set forth in the Administrative Procedure Act (‘APA’), see

28 U.S.C. § 1491(b)(4) (citing 5 U.S.C. § 706), ‘by which an agency’s decision is to be

set aside only if it is arbitrary, capricious, an abuse of discretion, or otherwise not in

accordance with law[.]’” (quoting NVT Techs., Inc. v. United States, 370 F.3d 1153, 1159

17

(Fed. Cir. 2004)) (citing PAI Corp. v. United States, 614 F.3d 1347, 1351 (Fed. Cir.

2010))); Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at

1332; Res. Conservation Grp., LLC v. United States, 597 F.3d 1238, 1242 (Fed. Cir.

2010) (“Following passage of the APA in 1946, the District of Columbia Circuit in Scanwell

Labs., Inc. v. Shaffer, 424 F.2d 859 (D.C. Cir. 1970), held that challenges to awards of

government contracts were reviewable in federal district courts pursuant to the judicial

review provisions of the APA.”); Galen Med. Assocs., Inc. v. United States, 369 F.3d 1324,

1329 (Fed. Cir. 2004) (citing Scanwell Labs., Inc. v. Shaffer, 424 F.2d at 864, 868, for its

“reasoning that suits challenging the award process are in the public interest and

disappointed bidders are the parties with an incentive to enforce the law”); Banknote

Corp. of Am., Inc. v. United States, 365 F.3d 1345, 1351 (Fed. Cir. 2004) (“Under the

APA standard as applied in the Scanwell line of cases, and now in ADRA cases, ‘a bid

award may be set aside if either (1) the procurement official’s decision lacked a rational

basis; or (2) the procurement procedure involved a violation of regulation or procedure.’”

(quoting Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at

1332)); Info. Tech. & Applications Corp. v. United States, 316 F.3d at 1319.

When discussing the appropriate standard of review for bid protest cases, the

United States Court of Appeals for the Federal Circuit addressed subsections (2)(A) and

(2)(D) of 5 U.S.C. § 706, see Impresa Construzioni Geom. Domenico Garufi v. United

States, 238 F.3d at 1332 n.5, but focused its attention primarily on subsection (2)(A). See

Croman Corp. v. United States, 724 F.3d 1357, 1363 (Fed. Cir.) (“‘[T]he proper standard

to be applied [to the merits of] bid protest cases is provided by 5 U.S.C. § 706(2)(A)

[(2006)]: a reviewing court shall set aside the agency action if it is “arbitrary, capricious,

an abuse of discretion, or otherwise not in accordance with law.”’” (alterations in original)

(quoting Banknote Corp. of Am. v. United States, 365 F.3d at 1350-51 (citing Advanced

Data Concepts, Inc. v. United States, 216 F.3d 1054, 1057-58 (Fed. Cir.), reh’g denied

(Fed. Cir. 2000)))), reh’g and reh’g en banc denied (Fed. Cir. 2013). The statute says that

agency procurement actions should be set aside when they are “arbitrary, capricious, an

abuse of discretion, or otherwise not in accordance with law,” or “without observance of

procedure required by law.” 5 U.S.C. § 706(2)(A), (D) (2012);10 see also Tinton Falls

10 The language of 5 U.S.C. § 706 provides in full:

To the extent necessary to decision and when presented, the reviewing

court shall decide all relevant questions of law, interpret constitutional and

statutory provisions, and determine the meaning or applicability of the terms

of an agency action. The reviewing court shall—

(1) compel agency action unlawfully withheld or unreasonably delayed;

and

(2) hold unlawful and set aside agency action, findings, and conclusions

found to be—

(A) arbitrary, capricious, an abuse of discretion, or otherwise not in

accordance with law;

18

Lodging Realty, LLC v. United States, 800 F.3d 1353, 1358 (Fed. Cir. 2015); Orion Tech.,

Inc. v. United States, 704 F.3d 1344, 1347 (Fed. Cir. 2013); COMINT Sys. Corp. v. United

States, 700 F.3d 1377, 1381 (Fed. Cir. 2012) (“We evaluate agency actions according to

the standards set forth in the Administrative Procedure Act; namely, for whether they are

‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’”

(quoting 5 U.S.C. § 706(2)(A); and Bannum, Inc. v. United States, 404 F.3d at 1351));

Savantage Fin. Servs. Inc., v. United States, 595 F.3d 1282, 1285-86 (Fed. Cir. 2010);

Weeks Marine, Inc. v. United States, 575 F.3d 1352, 1358 (Fed. Cir. 2009); Axiom Res.

Mgmt., Inc. v. United States, 564 F.3d 1374, 1381 (Fed. Cir. 2009) (noting arbitrary and

capricious standard set forth in 5 U.S.C. § 706(2)(A), and reaffirming the analysis of

Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332); Blue

& Gold Fleet, L.P. v. United States, 492 F.3d 1308, 1312 (Fed. Cir. 2007) (“‘[T]he inquiry

is whether the [government]’s procurement decision was “arbitrary, capricious, an abuse

of discretion, or otherwise not in accordance with law.”’” (quoting Bannum, Inc. v. United

States, 404 F.3d at 1351 (quoting 5 U.S.C. § 706(2)(A) (2000)))); NVT Techs., Inc. v.

United States, 370 F.3d at 1159 (“Bid protest actions are subject to the standard of review

established under section 706 of title 5 of the Administrative Procedure Act (‘APA’), 28

U.S.C. § 1491(b)(4) (2000), by which an agency’s decision is to be set aside only if it is

‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law,’ 5

U.S.C. § 706(2)(A) (2000).” (internal citations omitted)); Info. Tech. & Applications Corp.

v. United States, 316 F.3d at 1319 (“Consequently, our inquiry is whether the Air Force’s

procurement decision was ‘arbitrary, capricious, an abuse of discretion, or otherwise not

in accordance with law.’ 5 U.S.C. § 706(2)(A) (2000).”); Synergy Sols., Inc. v. United

States, 133 Fed. Cl. 716, 734 (2017) (citing Banknote Corp. of Am. v. United States, 365

F.3d at 1350); Eco Tour Adventures, Inc. v. United States, 114 Fed. Cl. at 22; Contracting,

Consulting, Eng’g LLC v. United States, 104 Fed. Cl. 334, 340 (2012). “In a bid protest

(B) contrary to constitutional right, power, privilege, or immunity;

(C) in excess of statutory jurisdiction, authority, or limitations, or short

of statutory right;

(D) without observance of procedure required by law;

(E) unsupported by substantial evidence in a case subject to sections

556 and 557 of this title or otherwise reviewed on the record of

an agency hearing provided by statute; or

(F) unwarranted by the facts to the extent that the facts are subject

to trial de novo by the reviewing court.

In making the foregoing determinations, the court shall review the whole

record or those parts of it cited by a party, and due account shall be taken

of the rule of prejudicial error.

5 U.S.C. § 706.

19

case, the agency’s award must be upheld unless it is ‘arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with law.’” Turner Constr. Co. v. United States,

645 F.3d 1377, 1383 (Fed. Cir.) (quoting PAI Corp. v. United States, 614 F.3d at 1351),

reh’g en banc denied (Fed. Cir. 2011); see also Tinton Falls Lodging Realty, LLC v. United

States, 800 F.3d at 1358 (“In applying this [arbitrary and capricious] standard to bid

protests, our task is to determine whether the procurement official’s decision lacked a

rational basis or the procurement procedure involved a violation of a regulation or

procedure.” (citing Savantage Fin. Servs., Inc. v. United States, 595 F.3d at 1285–86));

Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d 901, 907 (Fed. Cir.), reh’g

en banc denied (Fed. Cir. 2013); Nat’l Gov’t Servs., Inc. v. United States, 137 Fed. Cl.

715, 735 (2018) (quoting Centech Grp., Inc. v. United States, 554 F.3d 1029, 1037 (Fed.

Cir. 2009)); McVey Co., Inc. v. United States, 111 Fed. Cl. 387, 402 (2013) (“The first step

is to demonstrate error, that is, to show that the agency acted in an arbitrary and

capricious manner, without a rational basis or contrary to law.”); PlanetSpace, Inc. v.

United States, 92 Fed. Cl. 520, 531-32 (“Stated another way, a plaintiff must show that

the agency’s decision either lacked a rational basis or was contrary to law.” (citing Weeks

Marine, Inc. v. United States, 575 F.3d at 1358)), subsequent determination, 96 Fed. Cl.

119 (2010).

The United States Supreme Court has identified sample grounds which can

constitute arbitrary or capricious agency action:

[W]e will not vacate an agency’s decision unless it “has relied on factors

which Congress has not intended it to consider, entirely failed to consider

an important aspect of the problem, offered an explanation for its decision

that runs counter to the evidence before the agency, or is so implausible

that it could not be ascribed to a difference in view or the product of agency

expertise.”

Nat’l Ass’n of Home Builders v. Defenders of Wildlife, 551 U.S. 644, 658 (2007) (quoting

Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)); see

also Tinton Falls Lodging Realty, LLC v. United States, 800 F.3d at 1358; F.C.C. v. Fox

Television Stations, Inc., 556 U.S. 502, 552 (2009); Ala. Aircraft Indus., Inc.-Birmingham

v. United States, 586 F.3d 1372, 1375 (Fed. Cir. 2009), reh’g and reh’g en banc denied

(Fed. Cir. 2010); In re Sang Su Lee, 277 F.3d 1338, 1342 (Fed. Cir. 2002) (“[T]he agency

tribunal must present a full and reasoned explanation of its decision. . . . The reviewing

court is thus enabled to perform meaningful review . . . .”); Textron, Inc. v. United States,

74 Fed. Cl. 277, 285-86 (2006), appeal dismissed sub nom. Textron, Inc. v. Ocean

Technical Servs., Inc., 223 F. App’x 974 (Fed. Cir. 2007). The United States Supreme

Court also has cautioned, however, that “courts are not free to impose upon agencies

specific procedural requirements that have no basis in the APA.” Pension Benefit Guar.

Corp. v. LTV Corp., 496 U.S. 633, 654 (1990).

Under an arbitrary or capricious standard, the reviewing court should not substitute

its judgment for that of the agency, but should review the basis for the agency decision to

determine if it was legally permissible, reasonable, and supported by the facts. See Motor

20

Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. at 43 (“The scope of

review under the ‘arbitrary and capricious’ standard is narrow and a court is not to

substitute its judgment for that of the agency.”); see also Turner Constr. Co., Inc. v. United

States, 645 F.3d at 1383; R & W Flammann GmbH v. United States, 339 F.3d 1320, 1322

(Fed. Cir. 2003) (citing Ray v. Lehman, 55 F.3d 606, 608 (Fed. Cir.), cert. denied, 516

U.S. 916 (1995)); Synergy Sols., Inc. v. United States, 133 Fed. Cl. at 735 (citing Impresa

Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332-33). “‘“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.”’” Weeks Marine,

Inc. v. United States, 575 F.3d at 1371 (quoting Honeywell, Inc. v. United States, 870

F.2d 644, 648 (Fed. Cir. 1989) (quoting M. Steinthal & Co. v. Seamans, 455 F.2d 1289,

1301 (D.C. Cir. 1971))); Limco Airepair, Inc. v. United States, 130 Fed. Cl. 544, 550 (2017)

(citation omitted); Jordan Pond Co., LLC v. United States, 115 Fed. Cl. 623, 631 (2014);

Davis Boat Works, Inc. v. United States, 111 Fed. Cl. 342, 349 (2013); Norsat Int’l

[America], Inc. v. United States, 111 Fed. Cl. 483, 493 (2013); HP Enter. Servs., LLC v.

United States, 104 Fed. Cl. 230, 238 (2012); Vanguard Recovery Assistance v. United

States, 101 Fed. Cl. 765, 780 (2011).

Stated otherwise by the United States Supreme Court:

Section 706(2)(A) requires a finding that the actual choice made was not

“arbitrary, capricious, an abuse of discretion, or otherwise not in accordance

with law.” To make this finding the court must consider whether the decision

was based on a consideration of the relevant factors and whether there has

been a clear error of judgment. Although this inquiry into the facts is to be

searching and careful, the ultimate standard of review is a narrow one. The

court is not empowered to substitute its judgment for that of the agency.

Citizens to Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971) (internal citations

omitted), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977); see

also U.S. Postal Serv. v. Gregory, 534 U.S. 1, 6-7 (2001); Bowman Transp., Inc. v.

Arkansas-Best Freight Sys., Inc., 419 U.S. 281, 285 (1974), reh’g denied, 420 U.S. 956

(1975); Co-Steel Raritan, Inc. v. Int’l Trade Comm’n, 357 F.3d 1294, 1309 (Fed. Cir. 2004)

(In discussing the “arbitrary, capricious, and abuse of discretion, or otherwise not in

accordance with the law” standard, the Federal Circuit stated: “the ultimate standard of

review is a narrow one. The court is not empowered to substitute its judgment for that of

the agency.”); In re Sang Su Lee, 277 F.3d at 1342; Advanced Data Concepts, Inc. v.

United States, 216 F.3d at 1058 (“The arbitrary and capricious standard applicable here

is highly deferential. This standard requires a reviewing court to sustain an agency action

evincing rational reasoning and consideration of relevant factors.” (citing Bowman

Transp., Inc. v. Arkansas-Best Freight Sys., Inc., 419 U.S. at 285)); Lockheed Missiles &

Space Co. v. Bentsen, 4 F.3d 955, 959 (Fed. Cir. 1993); By Light Prof’l IT Servs., Inc. v.

United States, 131 Fed. Cl. 358, 366 (2017); BCPeabody Constr. Servs., Inc. v. United

States, 112 Fed. Cl. 502, 508 (2013) (“The court ‘is not empowered to substitute its

judgment for that of the agency,’ and it must uphold an agency’s decision against a

21

challenge if the ‘contracting agency provided a coherent and reasonable explanation of

its exercise of discretion.’” (internal citations omitted) (quoting Keeton Corrs., Inc. v.

United States, 59 Fed. Cl. 753, 755, recons. denied, 60 Fed. Cl. 251 (2004); and Axiom

Res. Mgmt., Inc. v. United States, 564 F.3d at 1381)), appeal withdrawn, 559 F. App’x

1033 (Fed. Cir. 2014); Supreme Foodservice GmbH v. United States, 109 Fed. Cl. at 382;

Alamo Travel Grp., LP v. United States, 108 Fed. Cl. 224, 231 (2012); ManTech

Telecomms. & Info. Sys. Corp. v. United States, 49 Fed. Cl. 57, 63 (2001), aff’d, 30 F.

App’x 995 (Fed. Cir. 2002); Ellsworth Assocs., Inc. v. United States, 45 Fed. Cl. 388, 392

(1999) (“Courts must give great deference to agency procurement decisions and will not

lightly overturn them.” (citing Fla. Power & Light Co. v. Lorion, 470 U.S. 729, 743-44

(1985))), appeal dismissed, 6 F. App’x 867 (Fed. Cir. 2001), and superseded by regulation

as recognized in MVS USA, Inc. v. United States, 111 Fed. Cl. 639 (2013).

According to the United States Court of Appeals for the Federal Circuit:

Effective contracting demands broad discretion. Burroughs Corp. v. United

States, 223 Ct. Cl. 53, 617 F.2d 590, 598 (1980); Sperry Flight Sys. Div. v.

United States, 548 F.2d 915, 921, 212 Ct. Cl. 329 (1977); see NKF Eng’g,

Inc. v. United States, 805 F.2d 372, 377 (Fed. Cir. 1986); Tidewater

Management Servs., Inc. v. United States, 573 F.2d 65, 73, 216 Ct. Cl. 69

(1978); RADVA Corp. v. United States, 17 Cl. Ct. 812, 819 (1989), aff’d, 914

F.2d 271 (Fed. Cir. 1990). Accordingly, agencies “are entrusted with a good

deal of discretion in determining which bid is the most advantageous to the

Government.” Tidewater Management Servs., 573 F.2d at 73, 216 Ct. Cl.

69.

Lockheed Missiles & Space Co. v. Bentsen, 4 F.3d at 958-59; see also Res-Care, Inc. v.

United States, 735 F.3d 1384, 1390 (Fed. Cir.) (“DOL [Department of Labor], as a federal

procurement entity, has ‘broad discretion to determine what particular method of

procurement will be in the best interests of the United States in a particular situation.’”

(quoting Tyler Constr. Grp. v. United States, 570 F.3d 1329, 1334 (Fed. Cir. 2009))), reh’g

en banc denied (Fed. Cir. 2014); Grumman Data Sys. Corp. v. Dalton, 88 F.3d 990, 995

(Fed. Cir. 1996); Geo-Med, LLC v. United States, 126 Fed. Cl. 440, 449 (2016); Cybertech

Grp., Inc. v. United States, 48 Fed. Cl. 638, 646 (2001) (“The court recognizes that the

agency possesses wide discretion in the application of procurement regulations.”);

Furthermore, according to the United States Court of Appeals for the Federal Circuit:

Contracting officers “are entitled to exercise discretion upon a broad range

of issues confronting them in the procurement process.” Impresa

Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324,

1332 (Fed. Cir. 2001) (internal quotation marks omitted). Accordingly,

procurement decisions are subject to a “highly deferential rational basis

review.” CHE Consulting, Inc. v. United States, 552 F.3d 1351, 1354 (Fed.

Cir. 2008) (internal quotation marks omitted).

PAI Corp. v. United States, 614 F.3d at 1351; see also AgustaWestland N. Am., Inc. v.

22

United States, 880 F.3d 1326, 1332 (Fed. Cir. 2018) (“Where, as here, a bid protester

challenges the procurement official’s decision as lacking a rational basis, we must

determine whether ‘the contracting agency provided a coherent and reasonable

explanation of its exercise of discretion,’ recognizing that ‘contracting officers are entitled

to exercise discretion upon a broad range of issues confronting them in the procurement

process.’” (quoting Impresa Construzioni Geom. Domenico Garufi v. United States, 238

F.3d at 1332-33 (internal quotation marks and citation omitted))); Weeks Marine, Inc. v.

United States, 575 F.3d at 1368-69 (“We have stated that procurement decisions ‘invoke

[ ] “highly deferential” rational basis review.’ Under that standard, we sustain an agency

action ‘evincing rational reasoning and consideration of relevant factors.’” (alteration in

original) (quoting CHE Consulting, Inc. v. United States, 552 F.3d at 1354 (quoting

Advanced Data Concepts, Inc. v. United States, 216 F.3d at 1058))).

A disappointed bidder has the burden of demonstrating the arbitrary and capricious

nature of the agency decision by a preponderance of the evidence. See Tinton Fall

Lodging Realty, LLC v. United Sates, 800 F.3d at 1364; see also Grumman Data Sys.

Corp. v. Dalton, 88 F.3d at 995-96; Enhanced Veterans Sols., Inc. v. United States, 131

Fed. Cl. 565, 578 (2017); Davis Boat Works, Inc. v. United States, 111 Fed. Cl. at 349;

Contracting, Consulting, Eng’g LLC v. United States, 104 Fed. Cl. at 340. The Federal

Circuit has indicated that “[t]his court will not overturn a contracting officer’s determination

unless it is arbitrary, capricious, or otherwise contrary to law. To demonstrate that such a

determination is arbitrary or capricious, a protester must identify ‘hard facts’; a mere

inference or suspicion . . . is not enough.” PAI Corp. v. United States, 614 F.3d at 1352

(citing John C. Grimberg Co. v. United States, 185 F.3d 1297, 1300 (Fed. Cir. 1999)); see

also Turner Constr. Co., Inc. v. United States, 645 F.3d at 1387; Sierra Nevada Corp. v.

United States, 107 Fed. Cl. 735, 759 (2012); Filtration Dev. Co., LLC v. United States, 60

Fed. Cl. 371, 380 (2004).

A bid protest proceeds in two steps. First . . . the trial court determines

whether the government acted without rational basis or contrary to law when

evaluating the bids and awarding the contract. Second . . . if the trial court

finds that the government’s conduct fails the APA review under 5 U.S.C.

§ 706(2)(A), then it proceeds to determine, as a factual matter, if the bid

protester was prejudiced by that conduct.

Bannum, Inc. v. United States, 404 F.3d at 1351; T Square Logistics Servs. Corp. v.

United States, Fed. Cl. 550, 555 (2017); FirstLine Transp. Sec., Inc. v. United States, 119

Fed. Cl. 116, 126 (2014), appeal dismissed (Fed. Cir. 2015); Eco Tour Adventures, Inc.

v. United States, 114 Fed. Cl. at 22; Archura LLC v. United States, 112 Fed. Cl. at 496.

To prevail in a bid protest case, the protestor not only must show that the government’s

actions were arbitrary, capricious, or otherwise not in accordance with the law, but the

protestor also must show that it was prejudiced by the government’s actions. See 5 U.S.C.

§ 706 (“[D]ue account shall be taken of the rule of prejudicial error.”); see also Glenn Def.

Marine (ASIA), PTE Ltd. v. United States, 720 F.3d at 907 (“In a bid protest case, the

inquiry is whether the agency’s action was arbitrary, capricious, an abuse of discretion,

or otherwise not in accordance with law and, if so, whether the error is prejudicial.”); IT

23

Enter. Sols. JV, LLC v. United States, 132 Fed. Cl. 158, 173 (2017) (citing Bannum v.

United States, 404 F.3d at 1357-58); Linc Gov’t Servs., LLC v. United States, 96 Fed. Cl.

672, 694-96 (2010). In describing the prejudice requirement, the Federal Circuit also has

held that:

To prevail in a bid protest, a protester must show a significant, prejudicial

error in the procurement process. See Statistica, Inc. v. Christopher, 102

F.3d 1577, 1581 (Fed. Cir. 1996); Data Gen. Corp. v. Johnson, 78 F.3d

1556, 1562 (Fed. Cir. 1996). “To establish prejudice, a protester is not

required to show that but for the alleged error, the protester would have

been awarded the contract.” Data General, 78 F.3d at 1562 (citation

omitted). Rather, the protester must show “that there was a substantial

chance it would have received the contract award but for that error.”

Statistica, 102 F.3d at 1582; see CACI, Inc.-Fed. v. United States, 719 F.2d

1567, 1574-75 (Fed. Cir. 1983) (to establish competitive prejudice, protester

must demonstrate that but for the alleged error, “‘there was a substantial

chance that [it] would receive an award--that it was within the zone of active

consideration.’”) (citation omitted).

Alfa Laval Separation, Inc. v. United States, 175 F.3d 1365, 1367 (Fed. Cir.), reh’g denied

(Fed. Cir. 1999); see also Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d

at 912; Allied Tech. Grp., Inc. v. United States, 649 F.3d 1320, 1326 (Fed. Cir.), reh’g en

banc denied (Fed. Cir. 2011); Info. Tech. & Applications Corp. v. United States, 316 F.3d

at 1319; Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at

1332-33; OMV Med., Inc. v. United States, 219 F.3d 1337, 1342 (Fed. Cir. 2000);

Advanced Data Concepts, Inc. v. United States, 216 F.3d at 1057; Stratos Mobile

Networks USA, LLC v. United States, 213 F.3d 1375, 1380 (Fed. Cir. 2000).

In Data General Corp. v. Johnson, the United States Court of Appeals for the

Federal Circuit wrote:

We think that the appropriate standard is that, to establish prejudice, a

protester must show that, had it not been for the alleged error in the

procurement process, there was a reasonable likelihood that the protester

would have been awarded the contract . . . . The standard reflects a

reasonable balance between the importance of (1) averting unwarranted

interruptions of and interferences with the procurement process and (2)

ensuring that protesters who have been adversely affected by allegedly

significant error in the procurement process have a forum available to vent

their grievances. This is a refinement and clarification of the “substantial

chance” language of CACI, Inc.-Fed. [v. United States], 719 F.2d at 1574.

Data Gen. Corp. v. Johnson, 78 F.3d 1556, 1562 (Fed. Cir.), reh’g denied, en banc

suggestion declined (Fed. Cir. 1996); see also Glenn Def. Marine (ASIA), PTE Ltd. v.

United States, 720 F.3d at 912; Bannum, Inc. v. United States, 404 F.3d at 1353, 1358

(“The trial court was required to determine whether these errors in the procurement

24

process significantly prejudiced Bannum . . . . To establish ‘significant prejudice’ Bannum

must show that there was a ‘substantial chance’ it would have received the contract award

but for the [government’s] errors” in the bid process. (citing Info. Tech. & Applications

Corp. v. United States, 316 F.3d at 1319; Alfa Laval Separation, Inc. v. United States,

175 F.3d at 1367; Statistica, Inc. v. Christopher, 102 F.3d at 1581; and Data Gen. Corp.

v. Johnson, 78 F.3d at 1562); see also Todd Constr., L.P. v. United States, 656 F.3d

1306, 1315 (Fed. Cir. 2011); Advanced Data Concepts, Inc. v. United States, 216 F.3d at

1057 (using a “reasonable likelihood” rule); Stratos Mobile Networks USA, LLC v. United

States, 213 F.3d at 1380 (using a “substantial chance” test); Am. Corr. Healthcare, Inc.

v. United States, 137 Fed. Cl. 395, 410 (2018) (using a “substantial chance” test); Vintage

Autoworks, Inc. v. United States, 132 Fed. Cl. 143, 149 (2017) (using a “substantial

chance” test); Active Network, LLC v. United States, 130 Fed. Cl. 421, 427 (2017) (using

a “substantial chance” test); Archura LLC v. United States, 112 Fed. Cl. at 496 (using a

“substantial chance” test); Info. Scis. Corp. v. United States, 73 Fed. Cl. 70, 96 (2006)

(using a “substantial chance” test), recons. in part, 75 Fed. Cl. 406 (2007).

In the above-captioned bid protest, on September 25, 2018, Safeguard filed its

second post-award bid protest at the GAO, in which Safeguard requested that “GAO

PROMPTLY NOTIFY DHS OF THE FILING OF THIS PROTEST AND THAT DHS BE

DIRECTED TO STAY PERFORMANCE OF THIS AWARD UNTIL THIS PROTEST IS

RESOLVED PURSUANT TO 4 C.F.R. § 21.6.” (capitalization and emphasis in original).

On October 2, 2018, Robin Fowler, “Head of the Contracting Activity, Federal Law

Enforcement Training Centers,” issued the Agency’s Determination and Findings for the

override, which stated that the Agency was overriding the CICA stay “both based upon

urgent and compelling circumstances that affect the interests of the United States and

that it is also in the best interests of the United States.”

Under CICA’s automatic stay, agencies, upon receiving notice that the award is

being protested, are to “direct the contractor to cease performance under the contract

and to suspend any related activities that may result in additional obligations being

incurred by the United States under that contract.” See 31 U.S.C. § 3553(d)(3)(A)(ii)(2).

CICA gives the Agency certain options to override a CICA stay, and, in the above-

captioned bid protest, the Agency did so. CICA provides:

(C) The head of the procuring activity may authorize the performance of the

contract (notwithstanding a protest of which the Federal agency has notice

under this section)--

(i) upon a written finding that--

(I) performance of the contract is in the best

interests of the United States; or

(II) urgent and compelling circumstances that

significantly affect interests of the United States

will not permit waiting for the decision of the

25

Comptroller General concerning the protest;

and

(ii) after the Comptroller General is notified of that finding.

31 U.S.C. § 3553(d)(3)(C).

Regarding override decisions, the United States Court of Appeals for the Federal

Circuit has determined that “28 U.S.C. § 1491(b)(1) grants the trial court jurisdiction over

an objection to a violation of 31 U.S.C. § 3553(c)(2).” RAMCOR Servs. Grp., Inc. v. United

States, 185 F.3d 1286, 1290 (Fed. Cir. 1999); see also Dyncorp Int’l LLC v. United States,

113 Fed. Cl. at 302 (“We have jurisdiction under the Tucker Act, 28 U.S.C. § 1491(b)

(2006), to review an agency decision to override a CICA stay.” (citing RAMCOR Servs.

Grp., Inc. v. United States, 185 F.3d at 1289-90)); Beechcraft Def. Co., LLC v. United

States, 111 Fed. Cl. 24, 31 (2013); Supreme Foodservice GmbH v. United States, 109

Fed. Cl. at 381 (“Challenges to alleged violations of the CICA automatic stay provision

are within this jurisdiction.” (citing RAMCOR Servs. Grp., Inc. v. United States, 185 F.3d

at 1290)).

Although not binding on this court, a template for evaluating an override

determination was offered by a Judge of this court in Reilly’s Wholesale Produce v. United

States, 73 Fed. Cl. 705 (2006).11 See Supreme Foodservice GmbH v. United States, 109

Fed. Cl. at 384 (“In Reilly’s Wholesale Produce v. United States, 73 Fed. Cl. 705 (2006),

one judge of our court surveyed the field of prior decisions and was able ‘to distill from

the relevant cases a variety of factors that an agency must consider in making an override

decision.’” (quoting Reilly’s Wholesale Produce v. United States, 73 Fed. Cl. at 711)); but

see PMTech, Inc. v. United States, 95 Fed. Cl. at 343 (“The court in Reilly’s Wholesale

has provided excellent guidance to this court, and to the procurement community, in

identifying factors that may be relevant to most CICA stay override decisions. As to the

precedential weight to be accorded the Reilly’s Wholesale factors, however, the court in

this decision must express some reservations.”). Override protests, however, are very

fact specific inquiries. See PMTech, Inc. v. United States, 95 Fed. Cl. at 344 (quoting

Automation Techs., Inc. v. United States, 72 Fed. Cl. at 727); Automation Techs., Inc. v.

United States, 72 Fed. Cl. at 727, 730. As explained in Beechcraft Defense Co., LLC, the

Reilly’s Wholesale court identified four factors to consider:

(1) “whether significant adverse consequences will necessarily occur if the

stay is not overridden”; (2) “whether reasonable alternatives to the override

exist that would adequately address the circumstances presented”; (3) “how

the potential cost of proceeding with the override, including the costs

associated with the potential that the GAO might sustain the protest,

11As indicated by the same Judge who issued the Reilly’s Wholesale decision, “‘the

decisions of this court are not binding precedent for judges of this court.’” Park Props.

Assocs., L.P. v. United States, 120 Fed. Cl. 787, 790 (2015) (quoting Sotera Def.

Solutions, Inc. v. United States, 118 Fed. Cl. 237, 258 (2014)), aff’d, 677 F. App’x 676

(Fed. Cir. 2017).

26

compare to the benefits associated with the approach being considered for

addressing the agency’s needs”; and (4) “the impact of the override on

competition and integrity of the procurement system.”

Beechcraft Defense Co., LLC v. United States, 111 Fed. Cl. at 31 (quoting Reilly’s

Wholesale Produce v. United States, 73 Fed. Cl. at 711); see also Supreme Foodservice

GmbH v. United States, 109 Fed. Cl. at 384. The court in Reilly’s Wholesale Produce

further stated that the “decisional law also indicates that certain factors are irrelevant to

this analysis, among them: (i) that the new contract would be better than the old one . . .

or (ii) the override and continuation of the contract is otherwise simply preferable to the

agency . . . .” Reilly’s Wholesale Produce v. United States, 73 Fed. Cl. at 711.

In discussing Reilly’s Wholesale, although a Judge of this court argued that “[t]he

court’s focus should be on whether the CICA stay override decision was rational and

whether the agency considered relevant factors, not on whether the agency conformed

its analysis to a specific framework elaborated by this court,” the Judge, nonetheless

acknowledged “the court recognizes the utility of the analytical framework provided by

Reilly’s Wholesale, but does not consider that the Reilly’s Wholesale factors govern the

outcome of this case.” PMTech, Inc. v. United States, 95 Fed. Cl. at 345. Likewise, the

undersigned is not bound by the Reilly’s Wholesale factors, but believes the factors are

a useful tool to help analyze the Agency’s decision to override the automatic stay based

on urgent and compelling circumstances in the context of APA review. See 5 U.S.C. §

706(2)(A).

The court in Reilly’s Wholesale Produce v. United States set forth an analytical

framework that was based on “a variety of factors that an agency must consider in making

an override decision based upon urgent and compelling circumstances.” 12 Reilly’s

Wholesale Produce v. United States, 73 Fed. Cl. at 711. The factors articulated in Reilly’s

Wholesale Produce v. United States “have been applied when the stay override is based

upon urgent and compelling circumstances, or based upon the best interests of the United

States.”13 Charles F. Day & Assocs., LLC v. United States, 120 Fed. Cl. 767, 771 (2015);

12 In a footnote, the court in Reilly’s Wholesale Produce v. United States stated:

Admittedly, some of the cases cited for the factors that are legally relevant

and irrelevant in this context are ones in which the agency override decision

was based upon the “best interests” of the United States. However, in the

court’s view, the rationale employed in those cases has, where indicated,

application to the review of an override decision based upon urgent and

compelling circumstances.

Reilly’s Wholesale Produce v. United States, 73 Fed. Cl. at 711 n.10.

13 In Dyncorp Int’l LLC v. United States, a Judge of the United States Court of Federal

Claims declined to apply the factors set forth in Reilly’s Wholesale Produce v. United

States to an agency’s override of the CICA stay “in the context of a ‘best interest’

justification.” See Dyncorp Int’l LLC v. United States, 113 Fed. Cl. at 303 n.4. The Dyncorp

27

see also Supreme Foodservice GmbH v. United States, 109 Fed. Cl. at 384 (noting that

the factors articulated in Reilly’s Wholesale Produce v. United States “have been

employed in cases reviewing overrides based on either justification”); E-Mgmt.

Consultants, Inc. v. United States, 84 Fed. Cl. 1, 6 (2008) (applying the Reilly’s Wholesale

Produce v. United States factors to an agency’s decision to override the CICA stay, in

which the agency justified the override decision as being in the “best interests of the

United States”). The undersigned is not bound by the Reilly’s Wholesale factors when

evaluating the Agency’s best interests justification for overriding the CICA stay, but

believes that the Reilly’s Wholesale factors are a useful analytical tool for evaluating

whether the Agency’s best interests justification was “arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with law.” See 5 U.S.C. § 706(2)(A).

In Safeguard’s second motion for a temporary restraining order and preliminary

injunction, Safeguard asserts that “Safeguard is extraordinarily likely to succeed on the

merits of this challenge.” Safeguard asserts that “[r]elevant case law clarifies that, in the

context of an ‘urgent and compelling’ justification, ‘adverse consequences’ are those

giving rise to a ‘threat of immediate harm to health, welfare, or safety.’” (citing Supreme

Foodservice GmbH v. United States, 109 Fed. Cl. at 387). Safeguard contends that the

Agency has failed to show any adverse consequences because

DHS’ primary reasoning is that any delay in performance of B&O’s contract

might lead to the cancellation of certain classes at FLETC, which could lead

to less expertise among law enforcement personnel. Respectfully, this

chain-link of alleged possible consequences facially does not reflect a threat

of immediate harm to health, welfare, or safety.

(emphasis in original). Safeguard asserts that, “[e]ven assuming, arguendo, that the D&F

alleges legally sufficient ‘urgent and compelling circumstances,’ the D&F fails because

any adverse consequences are of DHS’ own making in failing to extend SRM’s

performance.” (emphasis in original).

Safeguard also argues that “[t]here is no support for the D&F’s assertion that a

further bridge contract would not be ‘feasible or proper.’” (internal reference omitted).

According to Safeguard, the Agency did not “even attempt to quantify the economic harm

to DHS if Safeguard’s GAO protest is sustained,” but only asserted that, “in Mr. Caine’s

opinion, DHS will win the protest.” Regarding the Agency’s position that overriding the

CICA stay in the above-captioned bid protest was in the “best interests” of the United

States, Safeguard argues that the costs savings identified in the Agency’s Determination

and Findings is “mathematically erroneous.” In support of its position that the costs

Int’l LLC court stated that the Reilly’s Wholesale Produce v. United States test

“overstates what is required by the arbitrary and capricious standard particularly in the

context of a ‘best interest’ justification.” See id. The Dyncorp Int’l LLC court stated that

the “test for evaluating the merits of an agency's override decision is whether the agency's

determination was arbitrary, capricious, or otherwise not in accordance with law.” Id. at

302 (footnote omitted) (citing 5 U.S.C. § 706 (2012)).

28

savings are incorrect, Safeguard cites to the October 2, 2018 declaration signed by

Suresh S. Prabhu, who alleges that the amount B&O is billing the Agency for dormitory

maintenance services “is higher than what SRM has been charging under its recent

extension contracts and would be charging had DHS issued a further bridge contract.”

(emphasis in original). Additionally Safeguard argues that, “[p]erhaps more important,

case law from this Court clarifies that an agency cannot justify a CICA override based on

the ‘best interests of the United States’ by relying on an alleged cost difference of this

sort.” (citing Advanced Sys. Dev., Inc. v. United States, 72 Fed. Cl. at 31). According to

Safeguard, the October 2, 2018 Determination and Findings does not address the impact

of overriding the CICA stay on the integrity of the procurement system because “there is

no reasonable argument that DHS’ conduct benefits the procurement system and protects

CICA’s important goals. It plainly does the opposite.”

Safeguard argues that Safeguard will be irreparably harmed if injunctive relief is

not granted because “SRM’s contract with FLETC is ‘SRM’s largest source of revenue’

and ‘the immediate loss of SRM’s major source of revenue will further prejudice

Safeguard if it is required quickly, and expensively, to hire new employees for this work

following a reversal of DHS’ award decision in favor of B&O.’” (quoting the September 28,

2018 declaration signed by Suresh S. Prabhu). Safeguard contends that the harm to

Safeguard outweighs the harm to the Agency and B&O because “DHS already has

executed several contract extensions with SRM for the services in question,” and,

critically, DHS and B&O have represented to this Court that the transition to

B&O took place virtually overnight on Sunday, September 30, 2018.

Accordingly, DHS and B&O must concede that B&O’s transition just as

readily could be unwound, and that Safeguard could transition back if and

when this Court enjoins performance of B&O’s protested contract.

Safeguard further contends that the issuance of a temporary restraining order or a

preliminary injunction is in the public interest because the public interest would be served

if the Agency was permitted to ignore the “important statutory mandate” in CICA.

Defendant, however, contends that “the record shows that FLETC had a rational

basis for finding urgent and compelling circumstances to override the CICA stay.”

According to defendant, the Determination and Findings identified significant adverse

consequences that would result if the Agency did not override the CICA stay because

“Mr. Walters [in his role as Director of FLETC] testified that any reduction in FLETC’s

training capacity and output of fully trained and qualified officers and agents translates

directly into federal law enforcement agencies not having fully trained personnel to

conduct law enforcement functions critical to the safety and security of our nation.”

Defendant argues that “Mr. Walters confirmed that ‘FLETC simply does not have

adequate resources to replace all of the services provided by the contract,’” and that,

“[b]ecause FLETC is fully booked for the entire year, ‘a slowdown in current training

means that some quantity of training already scheduled for the fiscal year would be

displaced.’” (quoting the October 1, 2018 affidavit signed by Thomas J. Walters).

According to defendant, “Mr. Walters concluded that ‘delaying the deployment of new

29

federal law enforcement personnel to their duty stations because they were not able to

receive required basic training creates a significant risk to public safety and security.’”

Defendant notes that, “on four separate occasions, in connection with justifying sole-

source procurement actions (to SRM’s benefit) made ‘unusual and compelling urgency’

determinations with respect to the services at issue.”

Defendant asserts that the Agency “had no reasonable alternatives” to overriding

the CICA stay because SRM Group’s contract for dormitory maintenance services with

the Agency had expired in 2017 and, as the October 2, 2018 Determination and Findings

indicates, a “further bridge contract [was] not possible.” Defendant, however, also

contends that the Agency was not required to award SRM Group a bridge contract, and

that the Agency could not award a bridge contract for dormitory maintenance services

because “there was no time to comply with the congressional 5-day notification

requirement given the filing of SBO’s second protest on September 25, 2018 and the

expiration of SRM’s bridge contract on September 30, 2018.” Defendant asserts that “the

only contract vehicle that was available was the newly-awarded contract to B&O, for

which FLETC already had provided the requisite Congressional notification.” Defendant

also asserts that, in the Determination and Findings, the Agency considered Safeguard’s

second post-award bid protest and “correctly determined that there was little potential

cost of proceeding with the override.” According to defendant:

SBO asserts that because FLETC previously considered its incomplete

proposal, it is precluded now from determining the proposal should have

been excluded. In fact, the error that SBO noted in its first post-award

protest filed on August 20, 2018, was that FLETC improperly adjusted

SBO’s prices in part to add in those missing CLINs. SBO was correct that it

was improper for the agency to adjust SBO’s prices after its price realism

analysis, an adjustment prohibited in competitions for firm fixed prices by

FAR 15.404-1(d)(3). FLETC promptly took corrective action. In its

reevaluation, recognizing that due to SBO’s August 2018 protest that the

agency was powerless to adjust SBO’s proposed price for failure to include

the not-to-exceed amounts for CLINs XX7AA and XXX7AA, FLETC

properly determined that it could not consider the proposal for award. Now,

in its September 25, 2018, protest, SBO complains that it was improper for

FLETC to not adjust its prices.

(emphasis in original).

Defendant further contends that the Determination and Findings did consider the

integrity of the procurement system and explained “that allowing B&O, an 8(a) contractor

twice awarded this contract, to proceed is preferable to issuing a fifth FAR 6.302-3 J&A

in support of keeping in place a non-8(a) contractor whose contract expired 15 months

ago (9 months ago if you include the FAR 52.217-8 option).” Defendant asserts that

Safeguard has not established irreparable harm because

“the evidentiary record in this case makes clear that the stay of performance

30

that [SBO] seeks here would leave [SBO] in exactly the same position that

[SBO] would be in if the Court were to deny the requested relief, [SBO] is

and would remain an unsuccessful offeror for a contract [sic] has been

previously awarded to [B&O].”

(first, second, third, fourth, and sixth alteration added by defendant) (quoting Treadwell

Corp. v. United States, 133 Fed. Cl. 371, 383 (2017), aff’d, 726 F. App’x 826 (Fed. Cir.

2018)).

Defendant-intervenor, B&O, asserts that the Agency’s decision to override the

CICA stay was “proper under both the urgent and compelling circumstances and the best

interest justifications.” Defendant-intervenor argues that the Agency had no reasonable

alternative to overriding the CICA stay because “there was no time to comply with the

Congressional notification requirement before services were required,” and, “had FLETC

attempted to extend SRM’s performance by a fifth FAR 6.302-2 action, that determination

would have been subject to challenge given that there were qualified 8(a) companies

ready and able to perform that work. Not only was it not possible, it was not required.”

Defendant-intervenor also argues that the Agency’s “override was in the best interests of

the Government” because:

[A] stay of performance would have had the adverse consequences noted

in the Affidavit from FLETC’s Director supporting the override

determination, including the “significant potential” for consequences

“affecting the national security of the Nation,” FLETC’s best interests

justification for the override was more than sufficient. Plaintiff’s argument

that other stated reasons for the override in the D&F are lacking – that

Intervenor’s firm fixed monthly price of [redacted] is lower than the price of

Plaintiff’s minority owner, or because FLETC did not feel it appropriate to

have a non-8(a) continue to perform an 8(a) requirement does not change

the fact that FLETC’s need to avoid the service interruption that would have

resulted from the implementation of the stay was a sufficient basis for its

action.

Regarding plaintiff’s request for a temporary restraining order and preliminary

injunction, defendant-intervenor asserts:

Plaintiff’s claim of harm it would suffer should an injunction not be issued is

flawed for three reasons: (1) it muddles economic harm it may suffer with

harm that SRM may suffer, (2) confuses harm that would be caused by the

end of SRM’s contract with harm, if any, caused if the override decision is

not enjoined, and (3) claims harm it would incur should it not be awarded

the contract. Those harms are not relevant to the question of whether the

Plaintiff will suffer harm if the override is not enjoined.

(emphasis in original). Additionally, defendant-intervenor contends that “it is clear that

imposing an injunction that required FLETC to halt performance or to reinstall SRM, in

31

addition to being unsupported, would cause greater harm to the Government and the

Intervenor than allowing Intervenor to continue performing would cause to Plaintiff”

because of the “interruption” an injunction would have on “this important work.”

In the Agency’s October 2, 2018 Determination and Findings, Robin D. Fowler

states:

Upon the basis of the following findings, I, Robin D. Fowler, Head of the

Contracting Activity, Federal Law Enforcement Training Centers (FLETC),

have determined that performance of the contract for Dorm Management

Services in support of FLETC Glynco is authorized to proceed in the face

of a Government Accountability Office (GAO) protest (B-415588) filed by

Safeguard Base Operations, LLC (SBO) as continuing performance is both

based upon urgent and compelling circumstances that affect the interests

of the United States and that it is also in the best interests of the United

States.

(emphasis in original).

Under a heading titled “Existing Contract and Protest,” Ms. Fowler recounts the

history of SRM Group’s provision of dormitory maintenance services to the Agency. Ms.

Fowler notes that the period of performance under the original SRM Group Contract, as

awarded on June 28, 2012, began on July 1, 2012 and ended on June 30, 2017. Ms.

Fowler states that “FAR clause 52.217-8 Option to Extend Services was in the [SRM

Group] contract and FLETC exercised it, thus extending the period of performance an

additional six months to December 31, 2017.” Ms. Fowler notes that SRM Group’s

performance was extended for a second time when, on November 2, 2017, the Agency

had issued a Justification and Approval pursuant to FAR § 6.302-2 stating that the Agency

was entering “into a six month contract extension on a basis of other than full and open

competition beyond the current contract period” to December 31, 2017. The November

2, 2017 Justification and Approval alleges that “Dorm Management Services are critical

to sustain FLETC’s ability to train the Federal Law Enforcement Officers. This contract

extension will maintain contract support until a new contract can be awarded.” Ms. Fowler

references that SRM Group’s performance was extended for a third time on June 22,

2018, when the Agency had issued another Justification and Approval pursuant to FAR

§ 6.302-2 on the basis of unusual and compelling urgency. The June 22, 2018

Justification and Approval states that the Agency was “[e]xtending the period of

performance” for the SRM Group Contract to July 31, 2018 and indicates that “[a] lapse

in contract support would present an unacceptable risk to the FLETC. Should these

critical services become unavailable, it would have a major, negative impact on the ability

of the FLETC to provide critical training to approximately 95 federal agencies partnered

with the FLETC.”

In the October 2, 2018 Determination and Finding, Ms. Fowler discusses that, on

July 27, 2018, the Agency extend SRM Group’s performance for a fourth time. The July

27, 2018 Justification and Approval “extend[ed]” SRM Group’s performance until August

32

31, 2018 on the basis of other than full and open competition because of unusual and

compelling circumstances under FAR § 6.302-2. In the July 27, 2018 Justification and

Approval, the Agency again stated that a lapse in dormitory maintenance services would

pose an unacceptable risk to the Agency and would have a “major, negative impact on

the ability of the FLETC to provide critical training.” Ms. Fowler also notes that the Agency

“extend[ed]” SRM Group’s performance for a fifth time on August 29, 2018 when the

Agency had issued a fourth Justification and Approval pursuant to FAR § 6.302-2 on the

basis of unusual and compelling urgency. In the August 29, 2018 Justification and

Approval, the Agency, once again, stated that a potential lapse in dormitory maintenance

services posed an unacceptable risk to the Agency, and that a lapse in services would

negatively impact the Agency’s ability to train federal law enforcement officers. Thus, Ms.

Fowler notes that the Agency had extended the period of SRM Group’s performance of

dormitory maintenance services five times, once under FAR § 52.217-8 and four times

through Justifications and Approvals on the basis of other than full and open competition

because of unusual and compelling urgency under FAR § 6.302-2. In total, the Agency

utilized FAR § 52.217-8 and FAR § 6.302-2 to prolong SRM Group’s performance from

June 30, 2017 to September 30, 2018.

Regarding SRM Group’s performance under the four Justifications and Approvals,

in the October 2, 2018 Determination and Findings, Ms. Fowler states that:

In August, 2018, I learned from counsel, that the interested party’s attorneys

had objected to and expressed concern that the bridge contracts that

FLETC executed to obtain services during the protest, were obtained from

a contractor who was not in the 8A program and the acquisition was in the

8A program. Although, a standard practice at FLETC during protests was

awarding bridge contracts to the incumbent, I realized that this was not a

good practice in this case, and was contrary to my obligation to comply with

and fully support the Small Business Administration’s 8A program. This lead

to my decision to not award a new bridge contract to any contractor outside

the 8A program. It takes a total of five days to complete the congressional

notification process required for new awards in excess of one million dollars.

Thus, it was impossible to prepare and award a bridge contract to the

awardee for just the 120-day period required to complete the GAO protest

process in time to avoid doing without these services and jeopardizing

training. Therefore, I had no choice but to override the Stay to ensure

continued performance.

The Agency’s Urgent and Compelling Circumstances Justification

In a subsection of the October 2, 2018 Determination and Findings with a label

indicating that “Urgent and Compelling circumstances that significantly affect the

interests of the United States that will not permit waiting for the GAO decision on

the merits of the protest,” the October 2, 2018 Determination and Findings states:

The current contract has been extended several times beyond what is

33

normally allowed by the Extension of Services clause FAR 52.212-8 [sic].

Each extension has been a separate contract action supported by a

Justification and Approval (J&A) authorizing the continuation of services

under the status quo requirements. However, the incumbent contractor,

SRM Group, Inc., is no longer an 8(a) contractor, having graduated

approximately two years ago. Therefore, it is no longer feasible or proper to

continue services under the current contract to a contractor who is not even

an 8A contractor, and the only other option vice an override is to forego

these vital services throughout the GAO protest period. The impacts, as

described in the affidavit of Thomas J. Walters, Director of FLETC, would

be as follows:

1) Adversely impact FLETC training operations and could potentially

lead to classes being cancelled due to lodging disruption;

2) Could cause training to be unaffordable for our Partner Organizations

as we would attempt to use off-center lodging and it would be much

more expensive, and in some cases the Director believes they would

pull students from training as it would be unaffordable;

3) Due to upcoming CBP and ICE surge any disruption to lodging at a

time when we are looking for greater lodging capacity by double bunking

and more aggressive commercial lodging could jeopardize ability to

meet the requirements of the surge;

4) FLETC has limited staff and equipment resources and it is not clear

we could adequately clean common areas, issue keys, and maintain the

buildings adequate to meet health and safety needs which may well

result in the loss of the use of these dormitories even if we required

students to clean their own linens and rooms. Taking these steps would

negatively impact training as our training program is demanding, and

does not have student time included in the training schedule for room

and linen cleaning.

(emphasis in original). According to Ms. Fowler, “FLETC’s Chief Financial Officer

informed me [Ms. Fowler] the impact of replacing on-center lodging with off-center

lodging, assuming adequate off-center lodging was even available, would be

approximately $20 million over the course of a 120-day extension.”

In the October 1, 2018 affidavit signed by Thomas J. Walters,14 which is cited as

support in the October 2, 2018 Determination and Findings, Mr. Walters, the Director of

FLETC, states:

14 Safeguard’s October 4, 2018 second motion for a temporary restraining order and a

preliminary injunction and defendant’s and defendant-intervenor’s October 15, 2018

responses were filed before defendant filed the administrative record in the above-

captioned bid protest on October 16, 2018. Defendant included in the administrative

record the October 1, 2018 affidavit signed by Thomas J. Walters, as well as the October

12, 2018 supplemental affidavit signed by Thomas J. Walters. Safeguard has not objected

to the inclusion of the affidavits signed by Thomas J. Walters in the administrative record.

34

In Fiscal Year 2017, FLETC provided at its Glynco site basic qualification

training to over 16,000 Federal law enforcement officer and agent trainees,

and advanced training to almost 15,000 students. Additionally, FLETC has

begun planning efforts to meet the anticipated surge in training that CBP

and ICE will require to meet the hiring goals associated with Executive

Order 13767, Border Security and Immigration Enforcement Improvements,

and Executive Order 13768, Enhancing Public Safety in the Interior of the

United States. To meet the intents of these Executive Orders, CBP will hire

5,000 Border Patrol Agents and ICE will hire 10,000 Immigration Officers;

FLETC will be responsible for training almost all of them.

These extremely high training levels significantly exceed our on-Center

lodging capacity of just over 2,000 dormitory rooms/bed spaces. We are

attempting to increase our capacity by double-bunking many dormitory

rooms.

* * *

It would be impossible to make up for the loss of these dormitories through

hotels or other commercial lodging. FLETC has completely exhausted local

lodging options at our current level of training with all dormitories

operational. The budgetary constraints associated with attempting to house

additional students in commercial lodging would likely compel some of our

Federal partners to cancel training due to the increased costs associated

with off-Center lodging and transportation. Furthermore, utilizing lodging in

excess of 70 miles from FLETC would cause some of our Federal partners

to cancel training. Because FLETC is at full capacity for the entire training

year - and, in fact, has already informed some Federal partner agencies that

we could not support the entirety of their training requests - any training

cancelled could not be rescheduled for at least a year.

In the October 12, 2018 supplemental declaration signed by Thomas J. Walters,15

Mr. Walters states:

15 In the October 12, 2018 supplemental affidavit signed by Thomas J. Walters, Mr.

Walters states that “[t]his affidavit is not intended to contradict or in any way diminish my

previous affidavit. I prepared this supplemental affidavit to specifically clarify the

catastrophic harm that would result to the United States if the Court enjoins performance

of the FLETC’s Housing Maintenance contract.” In the October 12, 2018 supplemental

affidavit signed by Mr. Walters, Mr. Walters restates many of the conclusions Mr. Walters

reached in his October 1, 2018 affidavit, but further discusses the actions that the Agency

would take if the court were to issue an injunction in the above-captioned bid protest, as

well as the anticipated demands of the Agency’s federal agency partners in Fiscal Year

2019.

35

FLETC’s federal partners come from all 15 Cabinet-level departments, as

well as legislative branch and judicial branch organizations, independent

agencies, government corporations, and commissions. When they send

personnel for basic training at FLETC, they expect fully trained law

enforcement officers and agents to be ready for operations on their planned

graduation dates. Delays in training these personnel thus create personnel

deficits with the potential to impact the broad spectrum of federal law

enforcement activities in the United States. This would include, but is not

limited to, border security, apprehending violent fugitives, protecting our

Nation’s leaders and diplomats, aviation security, securing the U.S. Capitol

and numerous other federal buildings, investigating drug crimes, patrolling

our national parks, and other law enforcement operations that are critical to

public safety and security.

* * *

Any reduction in FLETC’s training capacity and output of fully trained and·

qualified officers and agents translates directly into federal law enforcement

agencies not having fully trained personnel to conduct law enforcement

functions critical to the safety and security of our nation’s communities and

people. Failure to replace the retiring officers would severely limit the ability

of Federal law enforcement agencies to safeguard Federal property and

personnel and to enforce the law in the National Parks. Agencies such as

the Capital Police, Federal Protective Service, the Secret Service agents

and uniformed officers, and United States Marshals, along with numerous

other agencies, all train at FLETC. Any reduction in the output of the FLETC

training pipeline of trained law enforcement officers to replace the officers

leaving these agencies would jeopardize health and safety by resulting in

less officers. This could affect the security of Federal buildings, courthouses

and the National Parks. This does not even address the draconian

consequences along the United States border that could result as FLETC

would not be able to respond to the anticipated surge directed by the

Executive Orders, as discussed in my previous affidavit.

As in the October 1, 2018 affidavit, Mr. Walters again states in the October 12, 2018

supplemental affidavit that, even if students were required to perform some dormitory

maintenance services, the Federal Law Enforcement Training Center in Glynco, Georgia,

still would not have adequate staff to complete all of the necessary dormitory maintenance

services. According to the October 12, 2018 supplemental affidavit, the Federal Law

Enforcement Training Center’s Mission Readiness and Support Directorate “is not staffed

for this additional work and is fully engaged with the duties for which they were hired.”

The October 2, 2018 Determination and Findings and the affidavits signed by

Thomas J. Walters indicate that, if the Agency does not have a contractor providing

dormitory maintenance services while Safeguard’s second post-award bid protest is

pending at the GAO, which may be pending until January 3, 2019, the Agency will be

36

unable to continue training a sufficient number federal law enforcement officers and will

not be able to house all of its students on site in Glynco, Georgia. By not operating at its

full capacity, the Federal Law Enforcement Training Center in Glynco, Georgia, will have

to cancel training sessions for federal law enforcement officers. According to the October

1, 2018 affidavit signed by Thomas J. Walters, “FLETC is at full capacity for the entire

training year,” and “any training cancelled could not be rescheduled for at least a year.”

Any cancellation of training for federal law enforcement students, therefore, would result

in federal agencies being unable to meet their demands for qualified, trained federal law

enforcement officers, which would undermine the ability of federal agencies to field the

necessary number of federal officers.

The Agency indicates that, without a contractor providing dormitory maintenance

services, the Agency would have to outsource some of its lodging requirements to

commercial providers, which would increase the costs of training federal law enforcement

officers. The October 2, 2018 Determination and Findings indicates that the cost of

outsourcing lodging to commercial providers would be “approximately $20 million over

the course of a 120-day extension.” The increased costs of training would be passed onto

federal agency partners, and, because outsourcing lodging requirements to commercial

providers increases the cost of training, federal agencies will be unable to afford to train

a sufficient number of new officers. The October 1, 2018 affidavit signed by Thomas J.

Walters indicates that, by training fewer federal law enforcement officers, there will not be

enough trained federal officers to meet the demands of federal agencies, “thereby

effecting the national security of the Nation.” Moreover, the October 2, 2018

Determination and Findings and the October 1, 2018 affidavit signed by Thomas J.

Walters indicate that the demands of federal agencies have increased in connection with

the issuance of several Executive Orders. According to the October 12, 2018 affidavit

signed by Mr. Walters, the Agency trained more than 20,000 recruits in Fiscal Year 2018,

and, “[f]or FY [fiscal year] 2019, FLETC expects this demand to exceed its capacity in

terms of facilities and instructor resources.”

If the Agency was not able to acquire dormitory maintenance services covering the

duration of Safeguard’s second post-award bid protest at the GAO after SRM Group’s

performance was complete on September 30, 2018, the Agency’s ability to produce

qualified, trained federal law enforcement officers would have been greatly diminished.

Without a contractor providing dormitory maintenance services, the Agency would have

been unable to meet its current training schedule as previously established with federal

agencies, and federal agencies would have received less trained federal law enforcement

officers than anticipated. As indicated in the October 12, 2018 supplemental affidavit

signed by Thomas J. Walters, the inability of the Agency to meet the demands of federal

agency partners limits “the ability of Federal law enforcement agencies to safeguard

Federal property and personnel and to enforce the law in the National Parks.” The

consequences of forgoing dormitory maintenance services while Safeguard’s second

post-award bid protest is resolved at the GAO until January 3, 2019 would be significant

and adverse and would negatively impact the pool of trained federal law enforcement

officers available for use by federal agencies. According to the October 12, 2018

supplemental affidavit signed by Thomas J. Walters, in Fiscal Year 2018, the Agency’s

37

contractor, in addition to providing dormitory maintenance services, was responsible for

“in-processing on average 375 arriving students in a given week,” and requiring “the

students to clean their own rooms, clean the dormitory common areas, wash their own

linen, and assist in controlling key distribution” would “result in a longer training day and

would necessarily force the pace of training to slow down.” The Agency also has

insufficient staff to provide the required dormitory maintenance services itself, for which

the Agency currently appears to be paying approximately $900,000.00 per month to B&O.

Indeed, the Agency had previously recognized the importance of dormitory

maintenance services when the Agency issued four Justifications and Approvals to SRM

Group, which authorized the continuation of dormitory maintenance services beyond the

expiration of the final option period of performance in the SRM Group Contract, as

awarded on June 28, 2012. Each of the four Justifications and Approvals asserted that

the need for continued dormitory maintenance services was an unusual and compelling

need and utilized other than full and open competition procedures under FAR § 6.302-2.

The four Justifications and Approvals identified dormitory maintenance services as being

critical to the Agency’s mission and indicated, “[s]hould these critical services become

unavailable, it would have a major, negative impact on the ability of the FLETC to provide

critical training to approximately 95 federal agencies partnered with FLETC.” The four

Justifications and Approvals issued to continue SRM Group’s provision of dormitory

maintenance services are consistent with the court’s conclusion that the Agency would

suffer significant adverse consequences if the Agency did not obtain dormitory

maintenance services during the balance of Safeguard’s second post-award bid protest

at the GAO.

As to whether there were reasonable alternatives to overriding the CICA stay, the

Agency first received notice of Safeguard’s second post-award bid protest on Tuesday,

September 25, 2018, when Safeguard filed its second post-award bid protest at the GAO.

As of September 25, 2018, the Agency had approximately five days to determine how to

proceed, before SRM Group’s performance under the fourth Justification and Approval

pursuant to FAR § 6.302-2 on the basis of unusual and compelling urgency was

scheduled to end on Sunday, September 30, 2018 and dormitory maintenance services

performance would come to an end.

The last option period of performance in SRM Group’s contract with the Agency,

as awarded on June 28, 2012, had been set to expire on June 30, 2017, but the Agency,

prior to the end of the SRM Group Contract, issued two three-month extensions of SRM

Group’s contract under FAR § 52.217-8. Thereafter, the Agency could not further extend

SRM Group’s performance under FAR § 52.217-8 because “the total extension of

performance” under FAR § 52.217-8 cannot exceed six months. See FAR § 52.217-8.

The Agency, however, had issued four Justifications and Approvals pursuant to FAR

§ 6.302-2 that, collectively, continued SRM Group’s performance from December 31,

2017 to September 30, 2018.16

16 According to defendant, the Agency’s Justifications and Approvals under FAR § 6.302-

2 were “sole-source contract actions” that “were justified by urgent and compelling

circumstances.” Defendant-intervenor argues that the Agency’s Justifications and

38

At the October 17, 2018 oral argument, counsel of record for Safeguard asserted

that, as an alternative to overriding the CICA stay, the Agency could have awarded a

sole-source bridge contract to SRM Group. The October 2, 2018 Determination and

Findings indicates that Ms. Fowler did consider awarding a bridge contract to SRM Group

for dormitory maintenance services, which, presumably, would have been issued

pursuant to FAR § 6.302-2 on the basis of unusual and compelling urgency, under which

the previous four Justifications and Approvals had been issued. Ms. Fowler, however,

stated that:

It takes a total of five days to complete the congressional notification

process required for new awards in excess of one million dollars. Thus, it

was impossible to prepare and award a bridge contract to the awardee for

just the 120-day period required to complete the GAO protest process in

time to avoid doing without these services and jeopardizing training.

Ms. Fowler’s statement in the October 2, 2018 Determination and Findings appears to be

referencing a requirement in the DHS Acquisition Manual (HSAM) (2018)17 at Section

3005.303-70, which is titled “Congressional notification of contract actions.” HSAM

§ 3005.303-70 states that the “Congressional notification requirements are required by

the Consolidated Appropriations Act, which is appropriations law.” See HSAM

§ 3005.303-70(a). DHS contracting officers are required to “prepare and electronically

submit the Congressional notification” to the DHS Office of Legislative Affairs at “least five

(5) full business days prior to the anticipated award or notice of award per Appendix D.

(i) The business day begins at 9:00 a.m. Eastern Time (ET). For notifications received

after 9:00 a.m. ET, the first full business day will be the day following receipt.” See HSAM

§ 3005.303-70(d). Appendix D of the HSAM states that Congressional notification is

required for “a new contract award with a total contract value (i.e. base and all option

quantities or periods) exceeding $1M,” as well as “a modification exceeding $1M

(excluding option exercises).” “[C]ontract actions” identified in Appendix D, which include

both new awards and modifications exceeding $1,000,000.00, “shall not be awarded,

issued or distributed, nor information released to sources outside of DHS (except as

described in FAR 15.503(a)(1)), until the requirements of Appendix D and this subsection

have been satisfied.” See HSAM § 3005.303-70(b).

If the Agency had opted to award a sole-source bridge contract to SRM Group

covering the period of October 1, 2018 to January 3, 2019, the bridge contract is

described as being in excess of $1,000,000.00, as SRM Group’s most recent three one-

month periods of performance under FAR § 6.302-2 were awarded at a value of

Approvals under FAR § 6.302-2 were “authorized based on FLETC’s determination that

unusual and compelling urgency supported sole-source contract actions.”

17 The HSAM is updated multiple times per year. See HOMELAND SECURITY ACQUISITION

MANUAL, https://www.dhs.gov/publication/hsam (last visited Oct. 24, 2018). The version

of the HSAM that was in effect when the Agency issued its October 2, 2018 Determination

and Findings was issued on June 29, 2018. See id.

39

$778,975.33, $882,537.69, and $996,416.13, respectively. As such, the bridge contract

would have required Congressional notification, as well as internal pre-notification actions

within the Agency. Because Safeguard filed its second post-award bid protest at the GAO

on Tuesday, September 25, 2018, Ms. Fowler correctly noted that the Agency could not

have completed the five-day Congressional notice requirement prescribed in HSAM

§ 3005.303-70(d) and that a bridge contract could not have been awarded before SRM

Group’s performance ended on Sunday, September 30, 2018, even if the Agency filed

the Congressional notice before 9:00 a.m., EDT, on Wednesday, September 26, 2018.

As noted by defendant, the Agency, however, had already provided Congressional

notification of an award to B&O under the Solicitation in June 2018, when the Agency had

first selected B&O as the apparent awardee under the Solicitation, prior to the multiple

bid protests filed by Safeguard.

Moreover, at the October 17, 2018 oral argument, Agency personnel indicated that

the five-day Congressional notice period is not the only step the Agency needs to take

when awarding a bridge contract. The Agency needs to negotiate pricing and other terms

with a potential bridge contract awardee and needs to prepare and execute

documentation justifying the award of a bridge contract. According to Agency personnel,

awarding a sole-source bridge contract can take one week to thirty days.18 The Agency,

therefore, would have been without dormitory maintenance services for a period of time

if the Agency had awarded a sole-source bridge contract to SRM Group, as counsel of

record for Safeguard suggested.19 The break in dormitory maintenance services, as

discussed above, would have adversely impacted the Agency’s ability to train federal law

enforcement officers, and the Agency would have had to reschedule any canceled

classes for more than a year later. Ms. Fowler recognized that it would not be possible to

award another sole-source bridge contract to any entity without experiencing a break in

dormitory maintenance services and rationally determined that a bridge contract was

unworkable under the circumstances. The Agency also was not required to award a sole-

18On September 27, 2018, Suresh S. Prabhu, the President of SRM Group, sent an email

message to Sheryle Wood, a contracting officer with the DHS, containing SRM Group’s

“Unsolicited Offer to Extend Services on the Housing Project at the current rates for 1 or

3 months.” (capitalization in original). Even if the Agency had quickly determined that

SRM Group’s “unsolicited offer” was in the interest of the Agency and executed another

sole-source bridge contract to SRM Group shortly thereafter, the Agency still would have

experienced a break in services of dormitory maintenance services, which would have

adversely impacted the Agency’s ability to train federal law enforcement officers, as

discussed above.

19 At the October 17, 2018 oral argument, counsel of record for B&O indicated that the

Agency could have awarded B&O a bridge contract, rather than overriding the CICA stay.

As the court’s analysis above demonstrates, however, the Agency could not have

awarded a bridge contract to Safeguard, B&O, or a different contractor without

experiencing a break in dormitory maintenance services, which would have negatively

impacted the Agency’s ability to train federal law enforcement officers, because of the

time required to negotiate a potential bridge contract and the five-day Congressional

notification requirement at HSAM § 3005.303-70.

40

source bridge contract to SRM Group, but was required to consider its alternatives to

overriding the CICA stay, which, based on Ms. Fowler’s statements in the October 2, 2018

Determination and Findings, the Agency did prior to deciding to override the CICA stay.

Other than awarding a sole-source bridge contract or having the Agency internally

provide the dormitory maintenance services, the parties and the Agency have not

identified possible alternatives to overriding the CICA stay which would keep dormitory

maintenance services in place. Because the Agency could not award a sole-source bridge

contract without experiencing a gap in dormitory maintenance services and does not have

sufficient staff to provide dormitory maintenance services itself, the Agency was faced

with either not having a contractor provide dormitory maintenance services to the Agency,

which would have significantly and adversely impacted the Agency’s training of federal

law enforcement officers, or overriding the CICA stay. The Agency rationally determined

that there were no reasonable alternative to overriding the CICA stay.

Regarding the third factor in Reilly’s Wholesale, “how the potential cost of

proceeding with the override, including the costs associated with the potential that the

GAO might sustain the protest, compare to the benefits associated with the approach

being considered for addressing the agency’s needs,” the October 2, 2018 Determination

and Findings states that:

Protest Issues/Analysis: The protest [at the GAO] rests on two

allegations:

a. Allegation 1: DHS Conducted an Unreasonable and Disparate

Pricing Evaluation. FLETC believes its pricing evaluation was accurate.

SBO failed to price a series of CLINs in the amount of $6.1M as specifically

directed by the solicitation, as amended. This mistake rendered their price

proposal non-compliant as offerors were warned could happen. Also,

because the FAR prohibits changing an offerors price as a result of a price

realism analysis, it was not possible to compare their price to other

compliant priced proposals in the trade-off analysis. Therefore, FLETC

expects GAO to rule in its favor.

b. Allegation 2: DHS Conducted a Flawed Best Value Trade-Off. The

source selection utilized a full trade-off process in accordance with FAR Part

15 in which all non-price factors when added together were approximately

equal to price. As stated above, SBO’s price proposal was non-compliant

and could not be compared to other prices in a trade-off analysis. However,

they were also not the highest technically evaluated offeror and the SSA

determined the premium price that would be paid to the highest rated offeror

was the best value to the Government. Therefore, FLETC expects GAO to

rule in its favor.

Legal Coordination: In making my determination, I [Robin Fowler] have

considered the advice of FLETC’s procurement attorney, Mr. James C.

41

Caine, regarding the merits of the protest that triggered the CICA Stay. In

his opinion, based upon his review of the protest, FLETC’s position appears

to be defensible and well supported by law and fact. Even if GAO were to

sustain the protest, however, the interests at risk from delay are so great

that they overcome the risks to the Agency of an adverse ruling by the GAO.

(emphasis in original). The October 2, 2018 Determination and Findings also states:

As one of the concerns of override is that the agency would be less likely to

comply with GAO’s ultimate ruling, it is noted that the Federal Law

Enforcement Training Centers was created in 1975, and through its entire

history, has never failed to comply with a recommendation of the

Government Accountability Office.[20]

The October 2, 2018 Determination and Findings indicates that the Agency, when

considering that the GAO might sustain Safeguard’s second post-award bid protest,

concluded that the Agency believed its position at the GAO to be “defensible” and “well

supported by law and fact.” The Agency found that the potential consequences that the

Agency would endure absent a contractor providing dormitory maintenance services to

be “so great that they overcome the risks to the Agency of an adverse ruling by the GAO.”

After consideration, the Agency has given no indication that it would not comply with

GAO’s ultimate ruling, and stated that the Federal Law Enforcement Training Center,

since its inception in 1975, has never failed to comply with a recommendation of the GAO.

Although protestor argues that the “D&F [Determination and Findings] does not even

attempt to quantify the economic harm to DHS if Safeguard’s GAO protest is sustained,”

the October 2, 2018 Determination and Findings indicates that the Agency considered

the possibility of the GAO sustaining Safeguard’s second post-award bid protest and

indicates that the Agency was aware that it would incur any costs associated if such a

result at the GAO should occur, but concluded the total risks to the Agency were worth

overriding the stay. See Superior Helicopter LLC v. United States, 78 Fed. Cl. at 193

(determining that an agency adequately considered the costs of an adverse GAO decision

notwithstanding that the agency “did not engage in a quantitative analysis of costs and

benefits”).

Moreover, in the October 2, 2018 Determination and Findings, the Agency

recognized a multitude of benefits to the law enforcement community at large associated

with overriding the CICA stay. The October 2, 2018 Determination and Findings indicates

that overriding the CICA stay would permit the Agency to continue training federal law

enforcement officers at the Agency’s current levels while Safeguard’s second post-award

bid protest is pending at the GAO. The October 2, 2018 Determination and Findings

recognizes that overriding the CICA stay allows the Agency to avoid the consequences

described in the October 2, 2018 Determination and Finding as being “catastrophic.” The

20“GAO decisions are only recommendations and not binding on the agency.” Jacobs

Tech. Inc. v. United States, 100 Fed. Cl. 186, 197 (2011) (citing 31 U.S.C. § 3554(b), (e);

and Honeywell, Inc. v. United States, 870 F.2d 644, 648 (Fed. Cir. 1989)).

42

Agency also noted that, “by overriding the stay of performance, the period of performance

is now long enough for the contractor to begin to implement double-bunking in two

dormitories, which is critical to resolving the shortage of on-center lodging.” The Agency

appears to have considered that the GAO may sustain Safeguard’s second post-award

bid protest, which the Agency regarded as unlikely, and determined that performance now

by B&O, the awardee under the Solicitation, outweighed the costs of transitioning to a

different contractor should the GAO sustain Safeguard’s second post-award bid protest.

As to the fourth factor identified by the United States Court of Federal Claims in

Reilly’s Wholesale, “the impact of the override on competition and integrity of the

procurement system,” the protestor correctly notes that the October 2, 2018

Determination and Findings did not explicitly address the impact overriding the CICA stay

would have on the procurement system. In the October 2, 2018 Determination and

Findings, however, the Agency did note that a potential concern of impacted parties may

be “that the agency would be less likely to comply with GAO’s ultimate ruling,” but noted

that the Agency has never failed to comply with a recommendation of the GAO. The

Agency determined that it could not award another bridge contract to SRM Group and

also discussed the impact of its previous extensions of SRM Group’s performance.

Although the words of the Determination and Findings that “it is no longer feasible or

proper to continue services under the current contract to a contractor [SRM Group] who

is not even an 8A contractor, and the only other option vice an override is to forego these

vital services throughout the GAO protest period” is not carefully crafted, it was not

necessarily the absence of SRM Group’s current 8(a) status that precluded award of a

bridge contract to SRM Group. Rather, a variety of issues led to the Agency’s decision,

including the overall procurement policy consideration of awarding the next contract

action to an 8(a) contractor, given that SRM Group had graduated from the 8(a) program

years ago. In the October 2, 2018 Determination and Findings, Ms. Fowler states that:

This lead to my decision to not award a new bridge contract to any

contractor outside the 8A program. It takes a total of five days to complete

the congressional notification process required for new awards in excess of

one million dollars. Thus, it was impossible to prepare and award a bridge

contract to the awardee for just the 120-day period required to complete the

GAO protest process in time to avoid doing without these services and

jeopardizing training.

The October 2, 2018 Determination and Findings, therefore, indicates that the Agency

considered the impact that overriding the CICA stay would have on the integrity of the

procurement system in light of the impact other potential, albeit unworkable under the

circumstances, alternatives would have on the procurement system, such as awarding a

bridge contract to a non-8(a) contractor for work that has previously been set-aside for

8(a) contractors and is currently set-aside for 8(a) contractors under the Solicitation.

Based on the record currently before the court, the Agency identified significant

adverse consequences that would occur if the Agency did not have a contractor providing

dormitory maintenance services, rationally determined that there were no reasonable

43

alternatives to overriding the CICA stay, considered the costs and benefits associated

with overriding the CICA stay, and considered the effects of the Agency’s actions on the

integrity of the procurement system. The Agency’s decision to override the CICA stay

based on “urgent and compelling circumstances that significantly affect interests of the

United States” and “will not permit waiting for the decision of the Comptroller General

concerning the protest,” therefore, was not arbitrary and capricious. See 31 U.S.C. §

3553(d)(3)(C).

The Agency’s Best Interests of United States Justification

In the October 2, 2018 Determination and Findings, Ms. Fowler indicates that

overriding the CICA stay “is also in the best interests of the United States.” “In order for a

stay override to be proper under a best interests justification, ‘[t]here must be some

rationale—above and beyond the principle aim originally sought when [the agency]

decided to engage bidders in the competitive procurement—that absolves the agency of

its obligation to await the GAO’s recommendation.’” Nortel Gov’t Sols., Inc. v. United

States, 84 Fed. Cl. at 251-52 (alterations in original) (quoting Advanced Sys. Dev., Inc. v.

United States, 72 Fed. Cl. at 31). An allegation that “the new contract is better than the

old one in terms of cost or performance is not enough to justify a best interests

determination.” See Advanced Sys. Dev., Inc. v. United States, 72 Fed. Cl. at 31; see

also Intelligent Waves, LLC v. United States, 137 Fed. Cl. at 626 (“An assertion that a

new contract is in essence better than a current one is not sufficient to show ‘best

interests.’” (quoting Advanced Sys. Dev., Inc. v. United States, 72 Fed. Cl. at 31)). “The

payment of significantly higher costs under an incumbent or bridge contract,” however,

may be “the sort of significant adverse consequence to justify an override when these are

shown to be prohibitive.” See Supreme Foodservice GmbH v. United States, 109 Fed. Cl.

at 393.

In the October 2, 2018 Determination and Findings, under a subheading stating

that “[c]ontinued performance is in the Best Interests of the United States,” Ms.

Fowler stated, in full, that:

The corrective actions over the past 3 months have resulted in a monthly

contract extension to the incumbent contractor. The first extension resulted

in an 11% increase over previous prices, which equals to $104,494.15. The

second extension resulted in an additional 7.5% increase, which equals

$20,125.99. Then finally, the third extension resulted in an additional 6%

increase, which equals $30,682.44. In total, FLETC is now paying in excess

of 26% over the original negotiated cost of these services, or $155,372.58

per month. The incumbent, SRM’s current monthly price is $325,979.12

over what we would be paying the awardee if the award were not

suspended as a result of the first protest, and would cause us to expend

close to $1.3 million for the period of the protest more than necessary, had

we continued performance with the incumbent. Thus it would fiscally

irresponsible to continue down this path, rather than continue services

44

under the newly awarded contract that was determined to offer the best

value to the government and not in the best interests of the Government.

Additionally, by overriding the stay of performance, the period of

performance is now long enough for the contractor to begin to implement

double-bunking in two dormitories, which is critical to resolving the shortage

of on-center lodging.

Finally, and most importantly, as stated previously, this is an 8(a)

designated service and the incumbent continuing to perform the work via a

bridge contract (extension) would go against the rules of the 8(a) program.

The awardee had demonstrated they are the most qualified 8A to perform

this work.

(emphasis and capitalization in original).

In the October 2, 2018 declaration signed by Suresh S. Prabhu, who states that

he is the President of SRM Group, Mr. Prabhu alleges that:

For the month of September 2018, SRM billed FLETC the following

amounts for housing services performed pursuant to the Contract: 1)

$[redacted] for the fixed fee items under the Contract; and 2) $[redacted]

for the variable items under the Contract (because the number of rooms

cleaned each month changes), for a total billing of $891,565.52. At this rate,

SRM’s annual billing under the Contract would be $10,698,786.24.

The Award made to B&O per the FBO is for $77,734,857.02 for a period of

7 years and 3 months (7.25 years), therefore the average rate that B&O

would be billing FLETC for the same services is $10,722,049.24 annually,

or $893,504.10 monthly, which is higher than what SRM has been charging

under its recent extension contracts and would be charging had DHS issued

a further bridge contract.

(emphasis in original). Based on the limited and conflicting evidence currently before the

court at this stage of the proceeding, however, it is unclear what the economic impact of

overriding the CICA stay would be on the Agency’s budget.

Protestor’s argument as to the Agency’s use of the best interests justification,

however, overlooks the lack of reasonable alternatives available to the Agency and the

significant adverse consequences the Agency would have encountered had the Agency

declined to override the CICA stay, as discussed above by the court. Although not

specifically restated under the subsection in the October 2, 2018 Determination and

Findings addressing the best interests of the United States, the Agency’s reasoning for

overriding the CICA stay, as expressed throughout the October 2, 2018 Determination

and Findings, indicates that overriding the CICA stay was in the best interests of the

United States. By overriding the CICA stay, the Agency will be able to continue training

45

federal law enforcement officers and will be able to continue to attempt to satisfy federal

agencies’ demands for qualified, trained federal law enforcement officers. As explained

in the October 1, 2018 affidavit signed by Thomas J. Walters, if the Federal Law

Enforcement Agency did not have a contractor providing dormitory maintenance services,

the impact on the FLETC’s ability to train Federal law enforcement officers

and airport screeners would be disastrous. Given the potential

consequences of the cancellation of training critical to secure the Nation -

and particularly its airports and borders - FLETC would do everything

possible to maintain the training schedule. However, it is doubtful FLETC

would have the internal resources to operate all nine dormitories without

this contract. Consequently, any significant reduction in our lodging capacity

would inevitably result in the cancellation of training and concomitant delay

in our Federal partners being able to deploy trained law enforcement

officers into their operational mission environments.

The October 2, 2018 Determination and Findings also states that, “by overriding the stay

of performance, the period of performance is now long enough for the contractor to begin

to implement double-bunking in two dormitories, which is critical to resolving the shortage

of on-center lodging” and will permit the Agency to increase its capacity to train federal

law enforcement officers.

Moreover, by overriding the CICA stay and having B&O provide dormitory

maintenance services, the Agency aimed to avoid future disruptions of dormitory

maintenance services and transitions of contractors providing dormitory maintenance

services. As noted in the October 2, 2018 Determination and Findings, SRM Group has

graduated from the 8(a) program, and the resultant contract under the Solicitation, which

has been awarded to B&O, is set-aside for 8(a) contractors for which SRM Group is not

eligible. Regardless of whether Safeguard prevails on its second post-award bid protest

at the GAO, SRM Group cannot be the awardee under the Solicitation because SRM

Group is not eligible to receive an 8(a) set-aside contract. Inevitably, the Agency was

going to have to transition away from SRM Group, and the Agency’s decision, under the

circumstances described in the October 2, 2018 Determination and Findings, to transition

to the current awardee under the Solicitation, B&O, was a rational Agency decision.

Potentially limiting future disruption of federal law enforcement officer training was a

rational element of the Agency’s decision considered to be in the best interests of the

United States, even with the risk of an adverse GAO decision in January 2019. The

Agency, therefore, has articulated a rational basis for overriding the CICA stay because,

according to FLETC, “performance of the contract is in the best interests of the United

States.” See 31 U.S.C. § 3553(d)(3)(C).

Turning to the second factor for a temporary restraining order or preliminary

injunction, whether protestor will suffer irreparable harm, “[w]hen assessing irreparable

injury, ‘[t]he relevant inquiry in weighing this factor is whether plaintiff has an adequate

remedy in the absence of an injunction.’” Insight Sys. Corp. v. United States, 110 Fed. Cl.

564, 582 (2013) (quoting Magellan Corp. v. United States, 27 Fed. Cl. 446, 447 (1993));

46

see also Iron Bow Techs., LLC v. United States, 132 Fed. Cl. 346, 358 (2017) (citing

Heritage of Am., LLC v. United States, 77 Fed. Cl. 66, 78, recons. denied, 77 Fed. Cl. 81

(2007)); Rush Constr., Inc. v. United States, 117 Fed. Cl. 85, 101 (2014); CW Gov’t

Travel, Inc. v. United States, 110 Fed. Cl. 462, 494 (2013); Overstreet Elec. Co. v. United

States, 47 Fed. Cl. 728, 743 (2000). If the Agency is permitted to continue acquiring

services from B&O as a result of the Agency’s override of the CICA stay, Safeguard will

not be losing the ability to perform a contract or losing an opportunity to compete for a

contract. Safeguard is not the incumbent contractor, nor is Safeguard currently on site

and ready to provide dormitory maintenance services. Nor will Safeguard be irreparably

harmed “because Safeguard’s proposal has been wrongfully eliminated from

consideration for award and it has filed a timely challenge of DHS’ irrational evaluation

with the GAO,” as protestor contends. Safeguard’s remedy at the GAO will be preserved,

regardless of whether this court upholds the Agency’s decision to override the CICA stay,

as the GAO is currently due to issue a decision on Safeguard’s second post-award bid

protest at the GAO on or before January 3, 2019. If the GAO sustains Safeguard’s second

post-award bid protest at the GAO, Safeguard’s opportunity to compete for a contract or

a portion of a contract under the Solicitation will be maintained.

Additionally, SRM Group, a forty-nine percent owner of the Safeguard joint

venture, will not be irreparably harmed if this court finds that the Agency’s decision to

override the CICA was rational. The Agency’s extension of the SRM Group Contract

under FAR § 52.217-8 expired in December 2017, and SRM Group performed under sole-

source contract actions on the basis of unusual and compelling circumstances under FAR

§ 6.302-2 from January 1, 2018 to September 30, 2018. SRM Group did not have a right

to receive additional sole-source bridge contracts under FAR § 6.302-2 from the Agency

after SRM Group’s performance ended on September 30, 2018.

Regarding the third factor for injunctive relief, the balance of the hardships, if the

court issues a temporary restraining order or preliminary injunction, the Agency will no

longer be able to acquire dormitory maintenance services from B&O in the manner in

which the Agency is currently receiving B&O’s services. The Agency will either have to

forgo dormitory maintenance services for an extended period of time and suffer the

significant adverse consequences discussed above or award a new bridge contract for

dormitory maintenance services, which also will result in the Agency being without

dormitory maintenance services for a period of time. The disruption of dormitory

maintenance services to the Agency and the costs of transitioning away from B&O and

possibly to another new contractor would impose financial hardships on the Agency and

would negatively impact the quality of the training provided to federal law enforcement

officers. The hardship injunctive relief imposes on the United States would outweigh the

harm to Safeguard because a remedy for Safeguard to challenge any alleged improper

evaluation by the Agency is preserved at the GAO. See Idea Int’l, Inc. v. United States,

74 Fed. Cl. 129, 142 (2006) (“Constant changing of teachers, regardless of their abilities,

would interrupt the quality of education provided. Inevitably, there would be delay in any

transition, and a corresponding delay in the expected educational progress of the

children. In balancing the harms, the Court’s deference to time-sensitive circumstances

is well established.” (citations omitted)).

47

Regarding the public interest factor, “‘[t]he public interest in honest, open, and fair

competition in the procurement process is compromised whenever an agency abuses its

discretion.’” CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. at 495 (quoting PGBA,

LLC v. United States, 57 Fed. Cl. 655, 663 (2003)); see also Torres Advanced Enter.

Sols., LLC v. United States, 133 Fed. Cl. 496, 534 (2017); Cohen Fin. Servs., Inc. v.

United States, 110 Fed. Cl. 267, 289 (2013); Am. Safety Council, Inc. v. United States,

122 Fed. Cl. 426, 444 (2015) (holding that “the public interest will be served by an

injunction by preserving the integrity of the procurement process”); Applied Bus. Mgmt.

Sol., Inc., LLC v. United States, 117 Fed. Cl. 589, 608 (2014); BINL, Inc. v. United States,

106 Fed. Cl. 26, 49 (2012) (“With regard to the public interest, it is well-settled that there

is a public interest in remedying violations of law.”); United Int’l Investigative Servs., Inc.

v. United States, 41 Fed. Cl. 312, 323 (1998) (“[T]he public has a strong interest in

preserving the integrity of the procurement process.” (citing Parcel 49C Ltd. P’ship v.

United States, 31 F.3d 1147, 1153 (Fed. Cir. 1994))); An important public interest is

served through conducting “honest, open, and fair competition” under the FAR, because

such competition improves the overall value delivered to the government in the long term.

See CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. at 495. In the above-captioned

bid protest, the Agency rationally determined to override the CICA stay because of urgent

and compelling circumstances and because overriding the CICA stay was in the best

interests of the United States, both of which were sufficiently considered before the

Agency arrived at its override decision. See 31 U.S.C. § 3553(d)(3)(C). By overriding the

CICA stay, the Agency will be able to continue to obtain and improve dormitory

maintenance services, services which are critical to the Agency’s ability to train federal

law enforcement officers for the Agency’s ninety-five federal agency partners who rely on

FLETC. The Agency also will further maintain the integrity of the 8(a) program by having

an 8(a) contractor, B&O, provide services that have been set-aside for 8(a) eligible

contractors. Although the automatic stay is no longer in place, the GAO process to review

the Agency’s procurement process remains active and in place.

CONCLUSION

Protestor has not demonstrated that the Agency’s decision to override the CICA

automatic stay was arbitrary, capricious, an abuse of discretion, or otherwise not in

accordance with law. Protestor’s second motion for a temporary restraining order and

preliminary injunction, therefore,

This text is long and has been trimmed here. Open the source document for the complete record.