Zeroavia, Inc. v. United States

In the United States Court of Federal Claims

No. 21-1991

(Filed under seal: June 7, 2022)

(Reissued for Publication: July 11, 2022) 1

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ZEROAVIA, INC., *

*

Plaintiff, *

Post-Award Bid Protest; Motion to

*

Dismiss; RCFC 12(b)(1); Standing;

v. *

Competitive Range; Substantial

*

Chance for Award.

THE UNITED STATES, *

*

Defendant. *

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William M. Weisberg, Law Offices of William Weisberg PLLC, McLean, VA, counsel for

Plaintiff.

Mariana Teresa Acevedo, U.S. Department of Justice, Civil Division, Washington, DC, counsel

for Defendant.

OPINION AND ORDER

DIETZ, Judge.

Plaintiff, ZeroAvia, Inc. (“ZeroAvia”), protests a decision by the National Aeronautics

and Space Administration (“NASA”) to exclude ZeroAvia from the competitive range in a

multiple award procurement for an electric-powered aircraft demonstration. The government

asserts that ZeroAvia lacks standing to bring its protest and moves to dismiss its complaint under

Rule 12(b)(1) of the Rules of the United States Court of Federal Claims. Because ZeroAvia has

failed to provide sufficient factual support to demonstrate that it had a substantial chance for

award, the Court finds that ZeroAvia has failed to meet its burden to establish that it has standing

to bring its protest. Accordingly, the government’s motion to dismiss is GRANTED.

I. BACKGROUND

NASA issued a solicitation for the development of an electrified powertrain flight

demonstration to accelerate integration of electrified aircraft propulsion technologies into the

United States aviation industry. Admin. R. 281-83, 735, ECF No. 12 [hereinafter AR]. The

1

This Opinion and Order was filed under seal on June 7, 2022, see ECF No. 22, in accordance with the Protective

Order entered on October 13, 2021. See ECF No. 10. The parties were given an opportunity to identify protected

information, including source selection, propriety information, and confidential information, for redaction. The

parties filed a joint status report proposing redactions on June 28, 2022. See ECF No. 26. All redactions were

unopposed. Id. at 1-2. The Court accepts all proposed redactions. All redactions have been blackened out.

solicitation called for a competitively negotiated procurement in accordance with Federal

Acquisition Regulation (“FAR”) Part 15. AR 682. NASA planned to award a single contract or

multiple contracts “to the responsible [o]fferor [or offerors] whose proposal conforms to the

solicitation and that will be most advantageous to the [g]overnment[.]” AR 743, 748-50. NASA

further explained that its tradeoff process would “us[e] the best value continuum where all

evaluation factors other than price, when combined, are significantly more important than price.”

AR 750. The solicitation required a proposal to be submitted in three volumes: Mission

Suitability, Past Performance, and Price. AR 735. The Mission Suitability evaluation factor is the

focus of this protest.

The solicitation provided that the Mission Suitability Factor “will be numerically

weighted and scored on a 1000-point scale.” AR 743. The Mission Suitability Factor comprised

five subfactors, which were each assigned a point weight—Project Objectives (100 points);

Statement of Work (300 points); Capability and Technology Development (250 points); Data

Collection and Technical Performance Validation (250 points); and Cost, Schedule, Risk, and

Technical Performance Management (100 points). AR 745. NASA established specific page

limits for the overall mission suitability volume, as well as for each subfactor. AR 736, 999-

1000. In evaluating the subfactors, the Source Evaluation Board (“SEB”) would independently

evaluate each offeror’s mission suitability volume to identify all significant strengths, strengths,

weaknesses, significant weaknesses, and deficiencies. AR 743-44. Each subfactor would then be

assigned an adjectival rating with an associated percentile range—Excellent (91-100), Very

Good (71-90), Good (51-70), Fair (31-50), Poor (0-30). AR 744. The adjectival rating

percentages would be “applied to the subfactor weight to determine the point score” for each

subfactor. Id. The total score for the Mission Suitability Factor would “be determined by adding

the point scores received for each Mission Suitability subfactor together.” Id.

NASA received seven proposals, of which six were evaluated by the SEB. 2 AR 7724-25,

7732-33. ZeroAvia, a company developing a hydrogen powered zero emissions flight system,

submitted a proposal. Compl. at 1, ECF No. 1; see also id. ¶ 5. Out of the six proposals

evaluated, ZeroAvia received the score for the Mission Suitability Factor—a score of

out of 1000 possible points. AR 7762, 7792, 7847. The contracting officer established a

competitive range consisting of the four highest rated proposals. AR 7805-06. The offerors

selected for the competitive range received scores ranging from 876 to 920 points. Id. After

NASA notified ZeroAvia that it was excluded from the competitive range, ZeroAvia requested a

debriefing in accordance with FAR 15.505. AR 7829, 7840-47; see Compl. at 2. At the

debriefing, NASA informed ZeroAvia that it was excluded from the competitive range because

its proposal was assessed weaknesses and significant weaknesses for the Mission

Suitability Factor. Compl. at 2; see AR 7840-47.

On October 8, 2021, ZeroAvia filed a complaint in this Court challenging its exclusion

from the competitive range. See Compl. at 8-9. The Court conducted an initial status conference

shortly thereafter. See Status Conf. Order, ECF No. 8. At the status conference, the government

proposed that it proceed with filing a motion to dismiss in advance of filing the administrative

2

NASA eliminated one of the seven proposals due to its noncompliance with the solicitation requirements. See AR

7732, 7805.

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record. See Oct. 13, 2021 Status Conf. at 9:42-11:24. 3 The government argued that there is no

need to file the administrative record because ZeroAvia lacks standing to pursue its protest. See

id. at 11:30-11:54. ZeroAvia “vehemently” objected to the government’s proposed approach and

argued that access to the administrative record was necessary for it to “respond intelligently” to

the government’s motion to dismiss. Id. at 12:08-13:40, 20:58-23:30, 24:08-24:41. The Court

agreed with ZeroAvia and ordered the government to file the administrative record prior to filing

its motion to dismiss. See Order at 1, ECF No. 9. The government filed the administrative record

on October 22, 2021. See AR. Subsequently, the government filed its motion to dismiss pursuant

to Rule 12(b)(1) of the Rules of the United States Court of Federal Claims (“RCFC”). See Def.’s

Mot. to Dismiss, ECF No. 13 [hereinafter Def.’s Mot.]. The government’s motion is fully

briefed, and the Court held oral argument on January 26, 2022.

II. LEGAL STANDARDS

A motion to dismiss for lack of standing pursuant to RCFC 12(b)(1) questions whether

the court has jurisdiction to adjudicate the merits of the underlying dispute. Warth v. Seldin, 422

U.S. 490, 498 (1975); RCFC 12(b)(1). The plaintiff bears the burden of establishing jurisdiction

by a preponderance of the evidence. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992);

Reynolds v. Army & Air Force Exch. Serv., 846 F.2d 746, 748 (Fed. Cir. 1988). “To survive a

motion to dismiss for lack of standing, a complaint must contain sufficient factual matter that

would plausibly establish standing if accepted as true.” Crow Creek Sioux Tribe v. United States,

900 F.3d 1350, 1355 (Fed. Cir. 2018) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009))

(internal quotations and brackets omitted). Conclusory allegations unsupported by any factual

assertions will not withstand a motion to dismiss. Dyck v. Albertelli Law, 98 Fed. Cl. 624, 630

(2011). The Supreme Court has articulated that while the pleading standard does not require

“detailed factual allegations,” it does require more than “labels and conclusions.” Bell Atl. Corp.

v. Twombly, 550 U.S. 544, 555 (2007). A court should only assume the veracity of factual

allegations where they are well-pleaded. Iqbal, 556 U.S. at 664. If the Court determines that a

protestor lacks standing then it lacks jurisdiction, and the Court must dismiss the case. See

Arbaugh v. Y & H Corp., 546 U.S. 500, 514 (2006).

This Court has jurisdiction under the Tucker Act to render judgment on a bid protest

action brought “by an interested party objecting to . . . any alleged violation of statute or

regulation in connection with a procurement.” 28 U.S.C. § 1491(b)(1) (emphasis added). Before

reaching the merits, the Court must first determine whether the protestor has standing to

challenge the agency’s award decision. Orbital Maint. & Constr. Co. v. United States, 145 Fed.

Cl. 71, 74 (2019); see Myers Investigative & Sec. Servs., Inc. v. United States, 275 F.3d 1366,

1369 (Fed. Cir. 2002) (highlighting that “standing is a threshold jurisdictional issue”). A

protestor eliminated from the competitive range is not necessarily precluded from establishing

standing. See Chenega Mgmt., LLC v. United States, 96 Fed. Cl. 556, 571 (2010) (citing Impresa

Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1334 (Fed. Cir. 2001)). A

protestor must show that it meets the standing requirements of § 1491(b)(1), which are “more

3

The Court cites to the timestamp for the electronic digital recording (“EDR”) for the October 13, 2021 status

conference.

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stringent” than the standing requirements imposed by Article III of the United States

Constitution. Diaz v. United States, 853 F.3d 1355, 1358 (Fed. Cir. 2017).

To meet the more stringent standing requirements, a protestor must make two separate

showings—that it is an interested party and that it was prejudiced by a significant error in the

procurement process. Id. To satisfy the interested party requirement, a protester must show that it

is an actual or prospective bidder who possesses the requisite direct economic interest. Weeks

Marine, Inc. v. United States, 575 F.3d 1352, 1359 (Fed. Cir. 2009). A protestor has a direct

economic interest if it shows that it had a substantial chance of winning the contract. CliniComp

Int’l, Inc. v. United States, 904 F.3d 1353, 1358-59 (Fed. Cir. 2018). For the prejudice

requirement, the protestor must establish that, but for the alleged procurement error, the protestor

would have had a substantial chance of receiving the contract award. Diaz, 853 F.3d at 1358; see

Info. Tech. & Applications v. United States, 316 F.3d 1312, 1319 (Fed. Cir. 2003) (highlighting

that the “prejudice issue must be reached before addressing the merits”). “Despite the potential

relevance of prejudice in determining substantial chance, direct economic interest should still be

evaluated separately from prejudice.” Veteran Shredding, LLC v. United States, 140 Fed. Cl.

759, 765 (2018) (quoting CliniComp Int’l, 904 F.3d at 1358-59); Universal Marine Co. K.S.C. v.

United States, 120 Fed. Cl. 240, 248 (2015) (“[A] proper standing inquiry must not conflate the

requirement of ‘direct economic interest’ with prejudicial error.”) (citing Labatt Food Serv., Inc.

v. United States, 577 F.3d 1375, 1380 (Fed. Cir. 2009)).

III. DISCUSSION

ZeroAvia challenges its exclusion from the competitive range based on various theories

as to why NASA’s evaluation was flawed. See Compl. ¶¶ 10-21. The government moves to

dismiss ZeroAvia’s complaint for lack of standing arguing that its challenges are “based on

speculative alleged errors” in NASA’s evaluation and that its complaint “does not contain any

specific allegations regarding why the agency’s evaluation was incorrect let alone why it has

standing here.” Def.’s Mot. at 13, 16; Def.’s Reply at 3, ECF No. 15. When confronted with the

government’s motion to dismiss, ZeroAvia had an opportunity to defend its complaint and rebut

the assertion that it lacks standing. However, ZeroAvia failed to seize this opportunity to explain

how the information in its complaint satisfies its burden to demonstrate that it has standing. See

Pl.’s Resp. to Def.’s Mot. to Dismiss at 1-5, ECF No. 14 [hereinafter Pl.’s Resp.]. Because the

Court finds that ZeroAvia’s allegations of procurement errors do not contain sufficient factual

support to demonstrate that it had a substantial chance of receiving an award, ZeroAvia fails to

meet its burden to establish that it has standing.

ZeroAvia’s complaint is plagued by broad, unsupported allegations of procurement errors

that are not sufficient to establish standing. A well-pled allegation of a procurement error may

confer standing to a protestor. See, e.g., Digitalis Educ. Sols., Inc. v. United States, 97 Fed. Cl.

89, 94 (2011), aff’d, 664 F.3d 1380 (Fed. Cir. 2012); Orbital Maint., 145 Fed. Cl. at 75-76; NVE,

Inc. v. United States, 121 Fed. Cl. 169, 180 (2015); Beta Analytics Int’l, Inc. v. United States, 67

Fed. Cl. 384, 395-96 (2005). However, allegations based upon conjecture are not enough to show

that a protestor had a substantial chance of winning the award. See HVF West, LLC v. United

States, 846 F. App’x 896, 898-99 (Fed. Cir. 2021) (citing Bannum, Inc. v. United States, 404

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F.3d 1346, 1358 (Fed. Cir. 2005)). ZeroAvia vaguely asserts that “[f]or each and every one of

the identified weaknesses or deficiencies in [ZeroAvia’s] proposal, [ZeroAvia] either did, in fact,

provide the information identified, and/or was being judged against an evaluation factor not set

forth in the solicitation.” Compl. ¶ 16. ZeroAvia further states that “NASA indicated to

[ZeroAvia] that [it] failed to provide sufficient detail in several areas required by the

solicitation[;]” however, ZeroAvia asserts that “each and every one of those areas was addressed

in one or more of: [ZeroAvia’s] proposal; in oral presentations; or in questions and answers with

NASA during the procurement.” Id. ¶ 13. The fatal flaw with these allegations is that they lack

factual support. For instance, ZeroAvia does not identify any particular weakness or deficiency

that was assessed as a result of an alleged procurement error despite having access to such

information as a result of the debriefing. See, e.g., AR 7843-47 (debriefed evaluation findings for

ZeroAvia’s mission suitability volume). ZeroAvia likewise does not reference the solicitation

requirements or its proposal contents to demonstrate that it actually provided the required

information or that NASA employed unstated criteria in evaluating its proposal. Further, despite

the Court ordering the government to produce the administrative record in advance of filing its

motion to dismiss to allow ZeroAvia to “respond intelligently,” Status Conf. at 12:08-13:40,

ZeroAvia did not cite to the administrative record a single time in its response. See Pl.’s Resp. at

1-5. When faced with the government’s challenges to its standing, it is not enough for ZeroAvia

to merely rely on the bare allegations of procurement errors in its complaint. Instead, to meet its

burden, ZeroAvia must provide relevant, competent proof to establish that it has standing.

RMGS, Inc. v. United States, 140 Fed. Cl. 728, 736 (2018) (citing Reynolds, 846 F.2d at 748).

ZeroAvia’s complaint contains allegations that are arguably more specific but similarly

lack sufficient factual support to establish standing. ZeroAvia argues that NASA employed

unstated evaluation criteria when it assessed weaknesses to its proposal due to “

” Compl. ¶ 14. ZeroAvia argues that while

“ [was] not an evaluation criterion in the solicitation[,]” it “clearly explained to

NASA, both in the proposal and in a variety of pre-procurement briefings, how

would be provided.” Id. Yet, ZeroAvia provides no factual support for its

allegations. For instance, ZeroAvia fails to identify any particular weakness that was assessed

because of the alleged unstated criteria for or to reference any portions of

its proposal that explain how would be provided. ZeroAvia also argues

that NASA employed unstated evaluation criteria when it assessed a significant weakness that

“ ” Id. ¶ 15. ZeroAvia contends that it “demonstrate[d] what data it

would collect and how[,]” but it was “criticized for not supporting a detailed NASA modeling

effort, when detailed information about that effort was not part of the solicitation.” Id. Yet,

ZeroAvia again provides no factual support for its allegation.

ZeroAvia’s allegation of unequal treatment also lacks factual support. ZeroAvia states

that “[c]ertain of NASA’s identified weaknesses and deficiencies involved a level of detail in

[ZeroAvia’s] proposal that was driven by the proposal page limitation” and that “no offerors

could meet the standard NASA set out in its evaluation of [ZeroAvia] and still remain within the

page limitations.” Compl. ¶ 17. ZeroAvia alleges that “NASA did not impose the same

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evaluation penalties on the offerors included in the competitive range as it did on [ZeroAvia]”

based on its “information and belief.” Id. at 3-4 (emphasis added). ZeroAvia cannot rely on this

boilerplate language to sustain its claim when ZeroAvia provides no details of the information to

which it has access and on which it relies to form its belief. ZeroAvia provides no explanation

for its broad assertion that no offeror could meet the page limit and also provide the level of

detail required by NASA in its evaluation. Additionally, ZeroAvia does not attempt to illustrate a

lack of detail in the other offerors’ proposals. ZeroAvia’s complaint merely states that “[h]ad

[ZeroAvia] received the same page limit ‘pass’ as other offerors, it would have been included in

the competitive range, and eventually have received a contract as one of the offerors providing

the best value to the [g]overnment.” Id. at 4. This claim is highly speculative and devoid of any

factual support. Simply alleging that NASA treated ZeroAvia unequally by applying a different

standard when assessing the level of detail in its proposal without any factual support is mere

conjecture and not enough to confer standing. See Orbital Maint., 145 Fed. Cl. at 76 (holding the

protestor lacked standing because its “highly speculative” arguments were not enough to confer

standing); SOS Int’l LLC v. United States, 127 Fed. Cl. 576, 588 (2016) (finding the protestor’s

allegations as merely speculative and inadequate to support standing). 4

ZeroAvia’s claim that NASA failed to engage in clarifications and meaningful

discussions in violation of the FAR is also too speculative and contradicted by the record.

ZeroAvia asserts that NASA failed to “engage in clarification or communication exchanges . . .

by failing to notify [ZeroAvia] of purported disqualifying but easily explainable issues in its

proposal.” Compl. at 4; id. ¶ 20. This argument is unsuccessful for two reasons. First, NASA did,

in fact, seek clarifications from ZeroAvia with respect to its proposal. See AR 6657-86, 6795-

834, 6928-47, 7078-164, 7255-304, 7429-77. Second, ZeroAvia grossly mischaracterizes the

purpose of clarifications under FAR 15.306(a)(2). See, e.g., Compl. at 3 (claiming that “various

NASA concerns” could have “easily” been clarified through clarifications). It is well-established

that clarifications under FAR 15.306(a)(2) provide an offeror the opportunity to “resolve minor

or clerical errors” only. See also Dell Fed. Sys., L.P. v. United States, 906 F.3d 982, 998 (Fed.

Cir. 2018) (“Clarifications are not to be used to cure proposal deficiencies or material omissions,

materially alter the technical or cost elements of the proposal, or otherwise revise the proposal.”).

ZeroAvia does not identify any weakness that could reasonably be considered a minor omission

or clerical error. To the contrary, the weaknesses identified in ZeroAvia’s proposal are clearly

not minor omissions or clerical errors and instead result from NASA’s determination that its

proposal lacked detail. See AR 744, 7491, 7734, 7759-62. ZeroAvia speculates that “[h]ad

NASA acted in [sic] reasonably it could easily have clarified its proposal, even without

providing a fully revised proposal, and thus would have been scored highly enough to be

included in the competitive range[.]” Compl. at 2. This argument is nothing more than mere

speculation.

4

ZeroAvia’s claim that NASA treated ZeroAvia unequally because it did not provide ZeroAvia with the same “page

limit pass” is also contradicted by the administrative record. All offerors were subject to the same page limitations

set forth in the solicitation, and all offerors submitted proposals within such page limitations. See AR 999-1000,

2201-938, 3734-78, 3782-4071, 4140-282, 5566-6144, 6206-422.

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ZeroAvia’s assertion that NASA failed to conduct meaningful discussions under FAR

15.306(d)(3) is also unavailing. See Compl. ¶ 20. ZeroAvia contends that discussions “would

have resulted in [ZeroAvia] being selected as one of the offerors providing the best value to the

government.” Id. The problem with this argument is that ZeroAvia was not entitled to

discussions with NASA because the solicitation stated that “[t]he government intends to evaluate

offers and award a contract without discussions.” AR 1006 (emphasis added). Further, the

solicitation made clear that discussions, if any, would be limited to offerors selected for the

competitive range. See AR 1504. Because ZeroAvia received the score and was not

included in the competitive range, it was not eligible for discussions. Therefore, ZeroAvia’s

assertion that it could have corrected its weaknesses through discussions is, at best, mere

speculation.

In its response to the government’s motion to dismiss, ZeroAvia argues that, for the Court

to find that ZeroAvia has failed to demonstrate that it had a substantial chance of award, the

Court would be required “to actively rule on each of the factual and legal issues raised in the

protest, when those issues have not been fully briefed or argued[.]” Pl.’s Resp. at 5. This is not

the case. The Court’s conclusion that ZeroAvia has not met its burden to demonstrate that it had

a substantial chance of award is not a ruling on the merits of the issues raised but instead a

finding that ZeroAvia has not provided sufficient factual support for its alleged procurement

errors to establish that it has standing to bring its protest. See Media Techns. Licensing, LLC v.

Upper Deck Co., 334 F.3d 1366, 1370 (Fed. Cir. 2003) (“Because standing is jurisdictional, lack

of standing precludes a ruling on the merits.”). Standing is determined “as of the commencement

of suit,” Rothe Dev. Corp. v. Dep’t of Def., 413 F.3d 1327, 1334 (Fed. Cir. 2005), and ZeroAvia

bears the burden to establish that it has standing as part of its complaint. See Crow Creek Siox

Tribe, 900 F.3d at 1355. ZeroAvia has failed to meet its burden. To make matters worse, despite

the Court ordering the government to make the administrative record available in advance of

filing its motion to dismiss, ZeroAvia failed to utilize the administrative record to rebut the

government’s challenges and demonstrate how its complaint establishes that it has standing.

Consequently, when the Court is forced to parse through a complaint riddled with unsupported

allegations, dismissal for lack of standing is an inevitable outcome.

IV. CONCLUSION

For the reasons set forth above, the government’s motion to dismiss pursuant to RCFC

12(b)(1) is GRANTED. ZeroAvia’s complaint is DISMISSED WITHOUT PREJUDICE. The

Clerk is DIRECTED to enter judgment.

IT IS SO ORDERED.

s/ Thompson M. Dietz

THOMPSON M. DIETZ, Judge

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