Goodwill Industries of South Florida, Inc. v. United States

In the United States Court of Federal Claims

No. 21-2323C

Filed: August 31, 2022

Reissued for Publication: September 18, 20221

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

GOODWILL INDUSTRIES OF SOUTH *

FLORIDA, INC., *

Protestor, *

v. *

*

UNITED STATES, *

Defendant. *

*

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

Alan M. Grayson, Windermere, FL, for protestor.

Ann C. Moto, Trial Attorney, Department of Justice, Commercial Litigation Branch,

Civil Division, Washington, DC, for defendant. With her were Steven J. Gillingham,

Assistant Director, Commercial Litigation Branch, Patricia M. McCarthy, Director,

Commercial Litigation Branch, and Brian M. Boynton, Principal Deputy Assistant

Attorney General. Allison Colsey Eck, Defense Logistics Agency, Troop Support, of

counsel.

OPINION

HORN, J.

In the bid protest filed in this court, protestor Goodwill Industries of South Florida,

Inc., sought to

enjoin the award or continued performance of any federal contract or

contracts, or the modification of any federal contract or contracts, awarded

to or performed by entities other than Goodwill [Industries of South Florida],

for the production (in whole or in part) of military equipment items known as

Women’s Army Improved Hot Weather Combat Uniform trousers

(“Women’s IHWCU Trousers” or the “Goodwill items”).

1 This Opinion was issued under seal on August 31, 2022. The parties were asked to

propose redactions prior to public release of the Opinion. This Opinion is issued without

redactions since the parties proposed no redactions in response to the court’s request.

(alteration added).2

The Javits-Wagner-O’Day (JWOD) Act, titled “Committee for Purchase From

People Who Are Blind or Severely Disabled,” 41 U.S.C. §§ 8501–06 (2018), and its

implementing regulations create a government procurement set aside for qualified

nonprofits. It is uncontested that protestor, Goodwill Industries of South Florida, is a

JWOD Act qualified nonprofit. Goodwill Industries of South Florida contends that it is a

“mandatory source of supply for” the Women’s IHWCU Trousers and that the

government’s “procurement of the Goodwill items from any source other than Goodwill

[Industries of South Florida] is a violation of procurement statutes and regulations.”

(alteration added). Therefore, according to protestor, “[b]ecause Goodwill [Industries of

South Florida] is the mandatory source of supply for the Goodwill items, if DLA [Defense

Logistics Agency] can issue solicitations for the Goodwill items at all, DLA should require

awardees under the Solicitations to acquire the Goodwill items from Goodwill [Industries

of South Florida].” (alterations added). Goodwill Industries of South Florida’s bid protest

complaint challenges solicitation No. SPE1C1-21-R-0029, which was divided into two

parts, an awarded small business set aside contract, and a future award to a HUBZone

contractor. According to the defendant, the United States, through the procuring agency,

the “DLA is a ‘defense agency’ under the authority, direction, and control of the

Department of Defense.” See 10 U.S.C. §§ 191–92 (2018); Department of Defense

Directive (DoDD) 5105.22 (June 29, 2017). This Opinion memorializes the oral decision

previously issued by the court in response to represented, urgent impending procurement

deadlines. The decision granted protestor Goodwill Industries of South Florida’s motion

for judgment on the Administrative Record, including injunctive relief, which was effective

immediately at the time of the oral decision.

FINDINGS OF FACT

When enacted, the JWOD Act was titled “Committee for Purchase from People Who

Are Blind or Severely Disabled.” 41 U.S.C. §§ 8501–06. Subsequently, the “Committee

for Purchase From People Who Are Blind or Severely Disabled,” was renamed in a

November 27, 2006 notice filed in the Federal Register:

The Committee for Purchase From People Who Are Blind or Severely

Disabled (the Committee) has deliberated and voted to change the name of

the JWOD Program to the AbilityOne Program. The name of the program is

being changed to AbilityOne to give a stronger, more unified identity to the

2 The court uses the term “Women’s IHWCU Trousers” to refer to the Improved Hot

Weather Combat Uniform Trousers designed specifically for women, the items at issue in

this protest. These items are sometimes referred to by the parties as “IHWCU-F”

Trousers, “Hot Weather Trousers,” or the “Goodwill items.”

2

program and to show a connection between the program name and the

abilities of those who are blind or have other severe disabilities.

AbilityOne Program, 71 Fed. Reg. 68492-01 (Nov. 27, 2006).3

The JWOD Act directs AbilityOne to create and maintain a Procurement List. The

JWOD Act provides:

(a) Procurement List.–

(1) Maintenance of list.—The Committee shall maintain and publish in

the Federal Register a procurement list. The list shall include the

following products and services determined by the Committee to be

suitable for the Federal Government to procure pursuant to this

chapter:

(A) Products produced by a qualified nonprofit agency for the blind

or by a qualified nonprofit agency for other severely disabled.

(B) The services those agencies provide.

(2) Changes to list.—The Committee may, by rule made in accordance

with the requirements of section 553(b) to (e) of title 5, add to and

remove from the procurement list products so produced and services

so provided.

41 U.S.C. § 8503(a) (2018). The JWOD Act also provides:

(c) Central nonprofit agency or agencies.—The Committee shall designate

a central nonprofit agency or agencies to facilitate the distribution, by direct

allocation, subcontract, or any other means, of orders of the Federal

Government[4] for products and services on the procurement list among

3The court uses the newer AbilityOne title, but leaves unchanged any quotations as they

exist in relevant documents, including briefs and attachments filed with the court, which

sometimes refer to AbilityOne as the “Commission.”

4 The JWOD Act states:

The terms “entity of the Federal Government” and “Federal Government”

include an entity of the legislative or judicial branch, a military department

or executive agency (as defined in sections 102 and 105 of title 5,

respectively), the United States Postal Service, and a nonappropriated fund

instrumentality under the jurisdiction of the Armed Forces.

41 U.S.C. § 8501(a) (2018).

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qualified nonprofit agencies for the blind or qualified nonprofit agencies for

other severely disabled.

(d) Regulations.—The Committee—

(1) may prescribe regulations regarding specifications for products and

services on the procurement list, the time of their delivery, and other

matters as necessary to carry out this chapter; and

(2) shall prescribe regulations providing that when the Federal

Government purchases products produced and offered for sale by

qualified nonprofit agencies for the blind or qualified nonprofit

agencies for other severely disabled, priority shall be given to

products produced and offered for sale by qualified nonprofit

agencies for the blind.

41 U.S.C. § 8503(c)–(d). With regard to specific procurement requirements, the JWOD

Act provides:

(a) In general.—An entity of the Federal Government intending to procure

a product or service on the procurement list referred to in section 8503

of this title shall procure the product or service from a qualified nonprofit

agency for the blind or a qualified nonprofit agency for other severely

disabled in accordance with regulations of the Committee and at the

price the Committee establishes if the product or service is available

within the period required by the entity.

(b) Exception.—This section does not apply to the procurement of a product

that is available from an industry established under Chapter 307 of title

18 and that is required under section 4124 of title 18 to be procured from

that industry.

41 U.S.C. § 8504(a)–(b) (2018).

In SEKRI, Inc. v. United States, 34 F.4th 1063 (Fed. Cir. 2022), the United States

Court of Appeals for the Federal Circuit offered a helpful and concise summary of the

JWOD Act’s legislative history and purpose:

The Javits-Wagner-O’Day Act (“JWOD Act”) was originally enacted in 1938

to prioritize purchasing of products from suppliers that employed blind

individuals. U.S. Statutes at Large, 75 Cong. Ch. 697, 52 Stat. 1196 (June

25, 1938) (JWOD Act). The JWOD Act established the “Committee on

Purchases of Blind-made Products” and charged it with various duties,

including determining fair market prices of “brooms and mops and other

suitable commodities manufactured by the blind and offered for sale to the

[f]ederal [g]overnment by any non-profit-making agency for the blind.” Id.

§ 2. The Act stated, “All brooms and mops and other suitable commodities

hereafter procured in accordance with applicable [f]ederal specifications by

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or for any [f]ederal department or agency shall be procured from such non-

profit-making agencies for the blind in all cases where such articles are

available within the period specified at the price determined by the

committee . . . .” Id. § 3.

The legislative history of the 1938 JWOD Act shows that Congress intended

to create a procurement system in which the government would be required

to purchase certain products from suppliers that employ blind individuals.

Under the new system, the government would “distribute . . . orders among

. . . agencies for the blind. In other words, instead of the present cutthroat

competition[,] the blind people who are engaged in this type of work will be

able to obtain it at a fair price.” 83 Cong. Rec. 9111 (1938). The bill would

take the buying of mops, brooms, and other suitable commodities “out of

competitive bidding.” Id. (emphasis added); see also S. Rep. 75-1330, at 2

(1938). Congress expanded the JWOD Act in 1971 to similarly protect

suppliers that employ “other severely handicapped” individuals. Pub. L. No.

92-28, 85 Stat. 77, 80 (1971); see also S. Rep. No. 92-41, at 1 (1971)

(stating Congress's principal objectives). Congress again amended the law

in 2011 by, among other things, renaming the Committee to be called the

“Committee for Purchase From People Who Are Blind or Severely

Disabled.” Pub. L. No. 111-350, 124 Stat. 3677, 3826 (2011).

The JWOD Act today, 41 U.S.C. §§ 8501–06, establishes a procurement

system, overseen by the Committee, in which the government procures

certain commodities and services from nonprofit agencies that employ the

blind or otherwise severely disabled. The Committee has the

responsibilities of, among other things, (i) maintaining and publishing a

“procurement list” identifying products and services made or rendered by

qualified nonprofit agencies for the blind or severely disabled, (ii)

designating one or more “central nonprofit agencies” to facilitate the

distribution of orders for the products and services on the procurement list,

and (iii) prescribing regulations implementing the law. See 41 U.S.C.

§ 8503.

SEKRI, Inc. v. United States, 34 F.4th at 1065–66 (emphasis and alterations in original).

The Federal Circuit further explained:

The Committee has promulgated regulations that define the complex

“AbilityOne Program,” which is the Committee’s name for the JWOD Act

procurement system. 41 C.F.R. pt. 51. These regulations reiterate the

mandatory nature of the AbilityOne Program. See 41 C.F.R. § 51–1.2(a)

(stating that the JWOD Act “mandates that commodities or services on the

[p]rocurement [l]ist required by [g]overnment entities be procured” from a

qualified nonprofit agency).

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The Committee’s regulations describe the role of the “central nonprofit

agencies” in the AbilityOne Program. The regulations designate

SourceAmerica (formerly known as NISH) as the central nonprofit agency

that works, in a number of respects, with nonprofit agencies that employ

people with severe disabilities other than blindness. Id. §§ 51–3.1 to –3.2.

SourceAmerica is responsible for representing those nonprofit agencies

when dealing with the Committee; evaluating the qualifications and

capabilities of nonprofit agencies; recommending commodities and services

for inclusion on the procurement list; distributing orders from government

contracting activities; and recommending price changes. Id. § 51–3.2. The

regulations also impose requirements on participating nonprofit agencies

to, for example, initially qualify for participation in the AbilityOne Program

and thereafter maintain their qualification. See id. pt. 51–4.

SEKRI, Inc. v. United States, 34 F.4th at 1066–67 (all alterations in original; footnote

omitted); see also PDS Consultants, Inc. v. United States, 907 F.3d 1345, 1348 (Fed. Cir.

2018) (“The JWOD Act was enacted in 1938 to provide employment opportunities for the

blind, and was amended in 1971 to provide such opportunities for ‘other severely disabled

individuals.’”), cert. denied sub. nom. Winston-Salem Indus. for the Blind v. PDS

Consultants, Inc., 140 S. Ct. 909 (2020).

The implementing regulations for the JWOD Act are contained in Titles 41 and 48

of the Code of Federal Regulations. Regarding the policy of the JWOD Act, the

implementing regulations state:

(a) It is the policy of the Government to increase employment and training

opportunities for persons who are blind or have other severe disabilities

through the purchase of commodities and services from qualified

nonprofit agencies employing persons who are blind or have other

severe disabilities. The Committee for Purchase from People who are

Blind or Severely Disabled (hereinafter the Committee) was established

by the Javits-Wagner-O’Day Act, Public Law 92-28, 85 Stat. 77 (1971),

as amended, 41 U.S.C. 46-48c (hereinafter the JWOD Act). The

Committee is responsible for implementation of a comprehensive

program designed to enforce this policy.

(b) It is the policy of the Committee to encourage all Federal entities and

employees to provide the necessary support to ensure that the JWOD

Act is implemented in an effective manner. This support includes

purchase of products and services published on the Committee’s

Procurement List through appropriate channels from nonprofit agencies

employing persons who are blind or have other severe disabilities

designated by the Committee; recommendations to the Committee of

new commodities and services suitable for addition to the Procurement

List; and cooperation with the Committee and the central nonprofit

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agencies in the provision of such data as the Committee may decide is

necessary to determine suitability for addition to the Procurement List.

41 C.F.R. § 51-1.1 (2020).

To further the policy of the JWOD Act, the implementing regulations establish

“Mandatory source priorities.” 41 C.F.R. § 51-1.2(a) (2020). The regulation at 41 C.F.R.

§ 51-1.2(a) provides:

(a) The JWOD Act mandates that commodities or services on the

Procurement List required by Government entities be procured, as

prescribed in this regulation, from a nonprofit agency employing persons

who are blind or have other severe disabilities, at a price established by

the Committee, if that commodity or service is available within the

normal period required by that Government entity. Except as provided

in paragraph (b) of this section, the JWOD Act has priority, under the

provisions of 41 U.S.C. § 48,[5] over any other supplier of the

Government’s requirements for commodities and services on the

Committee’s Procurement List.

41 C.F.R. § 51-1.2(a) (alteration added). The JWOD Act implementing regulations define

the Procurement List as “a list of commodities (including military resale commodities) and

services which the Committee has determined to be suitable to be furnished to the

Government by nonprofit agencies for the blind or nonprofit agencies employing persons

with severe disabilities pursuant to the JWOD Act and these regulations.” 41 C.F.R. § 51-

1.3 (2020).

The implementing regulation at 41 C.F.R. § 51-2.2 explains that:

[t]he Committee is responsible for carrying out the following functions in

support of its mission of providing employment and training opportunities

for persons who are blind or have other severe disabilities and, whenever

possible, preparing those individuals to engage in competitive employment:

(a) Establish rules, regulations, and policies to assure effective

implementation of the JWOD Act.

(b) Determine which commodities and services procured by the Federal

Government are suitable to be furnished by qualified nonprofit agencies

employing persons who are blind or have other severe disabilities and add

those items to the Committee’s Procurement List. Publish notices of

addition to the Procurement List in the Federal Register. Disseminate

information on Procurement List items to Federal agencies. Delete items no

5 The mandatory source requirement was formerly codified at 41 U.S.C. § 48 and was

recodified at 41 U.S.C. § 8504.

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longer suitable to be furnished by nonprofit agencies. Authorize and

deauthorize central nonprofit agencies and nonprofit agencies to accept

orders from contracting activities for the furnishing of specific commodities

and services on the Procurement List.

(c) Determine fair market prices for items added to the Procurement List

and revise those prices in accordance with changing market conditions to

assure that the prices established are reflective of the market.

(d) Monitor nonprofit agency compliance with Committee regulations and

procedures.

(e) Inform Federal agencies about the AbilityOne Program and the statutory

mandate that items on the Procurement List be purchased from qualified

nonprofit agencies, and encourage and assist entities of the Federal

Government to identify additional commodities and services that can be

purchased from qualified nonprofit agencies. To the extent possible,

monitor Federal agencies’ compliance with JWOD requirements.

(f) Designate, set appropriate ceilings on fees paid to these central nonprofit

agencies by nonprofit agencies selling items under the AbilityOne Program,

and provide guidance to central nonprofit agencies engaged in facilitating

the distribution of Government orders and helping State and private

nonprofit agencies participate in the AbilityOne Program.

(g) Conduct a continuing study and evaluation of its activities under the

JWOD Act for the purpose of assuring effective and efficient administration

of the JWOD Act. The Committee may study, independently, or in

cooperation with other public or nonprofit private agencies, problem s

relating to:

(1) The employment of the blind or individuals with other

severe disabilities.

(2) The development and adaptation of production methods

which would enable a greater utilization of these individuals.

(h) Provide technical assistance to the central nonprofit agencies and the

nonprofit agencies to contribute to the successful implementation of the

JWOD Act.

(i) Assure that nonprofit agencies employing persons who are blind will have

priority over nonprofit agencies employing persons with severe disabilities

in furnishing commodities.

41 C.F.R. § 51-2.2 (2020). The JWOD Act implementing regulations also state there is a

“statutory mandate that items on the Procurement List be purchased from qualified

nonprofit agencies.” 41 C.F.R. § 51-2.2; see also 41 U.S.C. § 8504(a).

Before adding or deleting an item from the Procurement List, the JWOD Act

implementing regulations state:

At least 30 days prior to the Committee’s consideration of the addition or

deletion of a commodity or service to or from the Procurement List, the

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Committee publishes a notice in the Federal Register announcing the

proposed addition or deletion and providing interested persons an

opportunity to submit written data or comments on the proposal.

41 C.F.R. § 51-2.3 (2020). In addition, before adding or deleting items, there must be a

“Determination of Suitability,” which requires:

(a) For a commodity or service to be suitable for addition to the Procurement

List, each of the following criteria must be satisfied:

(1) Employment Potential. The proposed addition must demonstrate a

potential to generate employment for persons who are blind or have

other severe disabilities.

(2) Nonprofit agency qualifications. The nonprofit agency (or agencies)

proposing to furnish the item must qualify as a nonprofit agency

serving persons who are blind or have other severe disabilities, as

set forth in part 51-4 of this chapter.

(3) Capability. The nonprofit agency (or agencies) desiring to furnish a

commodity or service under the JWOD Program must satisfy the

Committee as to the extent of the labor operations to be performed

and that it will have the capability to meet Government quality

standards and delivery schedules by the time it assumes

responsibility for supplying the Government.

(4) Level of impact on the current contractor for the commodity or

service.

(i) In deciding whether or not a proposed addition to the

Procurement List is likely to have a severe adverse impact on

the current contractor for the specific commodity or service,

the Committee gives particular attention to:

(A) The possible impact on the contractor’s total sales,

including the sales of affiliated companies and parent

corporations. In addition, the Committee considers the

effects of previous Committee actions.

(B) Whether that contractor has been a continuous supplier

to the Government of the specific commodity or service

proposed for addition and is, more dependent on the

income from such sales to the Government.

(ii) If there is not a current contract for the commodity or service

being proposed for addition to the Procurement List, the

Committee may consider the most recent contractor to furnish

the item to the Government as the current contractor for the

purpose of determining the level of impact.

41 C.F.R. § 51-2.4(a) (2020) (emphasis in original). When determining whether an item

should be added to the Procurement List,

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[t]he Committee considers the particular facts and circumstances in each

case in determining if a commodity or service is suitable for addition to the

Procurement List. When the Committee determines that a proposed

addition is likely to have a severe adverse impact on a current contractor, it

takes this fact into consideration in deciding not to add the commodity or

service to the Procurement List, or to add only a portion of the Government

requirement for the item. If the Committee decides to add a commodity or

service in whole or in part to the Procurement List, that decision is

announced in the Federal Register with a notice that includes information

on the effective date of the addition.

41 C.F.R. § 51-2.5 (2020).

The JWOD Act implementing regulation at 41 C.F.R. § 51-2.8 explains:

(a) The Committee maintains a Procurement List which includes the

commodities and services which shall be procured by Government

departments and agencies under the JWOD Act from the nonprofit

agency(ies) designated by the Committee. Copies of the Procurement List,

together with information on procurement requirements and procedures are

available to contracting activities upon request.

(b) For commodities, including military resale commodities, the Procurement

List identifies the name and national stock number or item designation for

each commodity, and where appropriate, any limitation on the portion of the

commodity which must be procured under the JWOD Act.

41 C.F.R. § 51-2.8(a)–(b) (2020).

Notably, the JWOD Act implementing regulations impose specific duties on federal

contracting activities to promote the goals of the JWOD Act. For example, 41 C.F.R.

§ 51-5.1 provides:

(a) Contracting activities are encouraged to assist the Committee and the

central nonprofit agencies in identifying suitable commodities and services

to be furnished by nonprofit agencies employing persons who are blind or

have other severe disabilities so that the Committee can attain its objective

of increasing employment and training opportunities for individuals who are

blind or have other severe disabilities. For items which appear to be suitable

to be furnished by nonprofit agencies, the contracting activity should refer

the candidate commodities and services to the Committee or a central

nonprofit agency. If a contracting activity decides to procure one or more

commodities which are similar to a commodity or commodities on the

Procurement List, the contracting activity should refer the commodities it

intends to procure to the Committee or a central nonprofit agency.

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(b) Contracting activities shall provide the Committee and designated central

nonprofit agencies with information needed to enable the Committee to

determine whether a commodity or service is suitable to be furnished by a

nonprofit agency. For commodities, information such as the latest

solicitation and amendments, bid abstracts, procurement history, estimated

annual usage quantities, and anticipated date or next solicitation issuance

and opening may be needed. For services, similar information including the

statement of work and applicable wage determination may be required. In

order to assist in evaluating the suitability of an office of Management and

Budget Circular A-76 conversion, contracting activities should provide a

copy of the draft statement of work and applicable wage determination to

the central nonprofit agency upon its request.

41 C.F.R. § 51-5.1 (2020).

For federal entities that seek to procure items on the Procurement List, the

regulation at 41 C.F.R. § 51-5.2 establishes JWOD qualified nonprofit organizations as

the mandatory sources of supply for Procurement List items. The regulation at 41 C.F.R.

§ 51-5.2, titled “Mandatory source requirement,” provides:

(a) Nonprofit agencies designated by the Committee are mandatory sources

of supply for all entities of the Government for commodities and services

included on the Procurement List, as provided in § 51-1.2 of this chapter.

(b) Purchases of commodities on the Procurement List by entities of the

Government shall be made from sources authorized by the Committee.

These sources may include nonprofit agencies, central nonprofit agencies,

Government central supply agencies such as the Defense Logistics Agency

and the General Services Administration, and certain commercial

distributors. Identification of the authorized sources for a particular

commodity may be obtained from the central nonprofit agencies at the

addresses noted in § 51-6.2 of this chapter.

(c) Contracting activities shall require other persons providing commodities

which are on the Procurement List to entities of the Government by contract

to order these commodities from the sources authorized by the Committee.

41 C.F.R. § 51-5.2(a)–(c) (2020). With regard to the scope of the mandatory source

requirement, the JWOD Act implementing regulation at 41 C.F.R. § 51-5.3(a) states:

(a) When a commodity is included on the Procurement List, the mandatory

source requirement covers the National Stock Number or item designation

listed and commodities that are essentially the same as the listed item. In

some instances, only a portion of the Government requirement for a

National Stock Number or item designation is specified by the Procurement

List. Where geographic areas, quantities, percentages or specific supply

locations for a commodity are listed, the mandatory provisions of the JWOD

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Act apply only to the portion or portions of the commodity indicated by the

Procurement List.

41 C.F.R. § 51-5.3(a) (2020).

In specific circumstances, it may be appropriate for AbilityOne or a central nonprofit

agency to grant a purchase exception to the mandatory source requirement enumerated

by the JWOD Act and its implementing regulations. The implementing regulation at 41

C.F.R. § 51-5.4 explains:

(a) A central nonprofit agency will normally grant a purchase exception for a

contracting activity to procure from commercial sources commodities or

services on the Procurement List when both of the following conditions are

met:

(1) The central nonprofit agency or its nonprofit agency(ies) cannot furnish

a commodity or service within the period specified, and

(2) The commodity or service is available from commercial sources in the

quantities needed and significantly sooner than it will be available from

the nonprofit agency(ies).

(b) The central nonprofit agency may grant a purchase exception when the

quantity involved is not sufficient to be furnished economically by the

nonprofit agency(ies).

(c) The Committee may also grant a purchase exception for the reasons set

forth in paragraphs (a) and (b) of this section.

(d) The central nonprofit agency shall obtain the approval of the Committee

before granting a purchase exception when the value of the procurement

exceeds the simplified acquisition threshold set forth in the Federal

Acquisition Streamlining Act of 1994 or any subsequent amendments

thereto.

(e) When the central nonprofit agency grants a purchase exception under the

above conditions, it shall do so promptly and shall specify the quantities and

delivery period covered by the exception.

(f) When a purchase exception is granted under paragraph (a) of this section:

(1) Contracting activities shall initiate purchase actions within 15 days

following the date of the purchase exception. The deadline may be

extended by the central nonprofit agency with, in cases of

procurements exceeding the simplified acquisition threshold, the

concurrence of the Committee.

(2) Contracting activities shall furnish a copy to the solicitation to the

appropriate central nonprofit agency at the time it is issued, and a

copy of the annotated bid abstract upon awarding of the commercial

contract.

(g) Any decision by a central nonprofit agency regarding a purchase exception

may be appealed to the Committee by the contracting activity.

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41 C.F.R. § 51-5.4 (2020).

If the appropriate central nonprofit agency or AbilityOne determines that a

particular order for Procurement List items may exceed the capability of one or more

nonprofits, the JWOD Act implementing regulations authorize either the central nonprofit

or AbilityOne to issue a purchase exception to the mandatory source requirement. The

regulation at 41 C.F.R. § 51-6.7 provides:

(a) Nonprofit agencies are expected to furnish commodities on the

Procurement List within the time frames specified by the Government. The

nonprofit agency must have the necessary production facilities to meet

normal fluctuations in demand.

(b) Nonprofit agencies shall take those actions necessary to ensure that they

can ship commodities within the time frames specified by the Government.

In instances where the nonprofit agency determines that it cannot ship the

commodity in the quantities specified by the required shipping date, it shall

notify the central nonprofit agency and the contracting activity. The central

nonprofit agency shall request a revision of the shipping schedule which the

contracting activity should grant, if feasible, or the central nonprofit agency

shall issue a purchase exception authorizing procurement from commercial

sources as provided in § 51-5.4 of this chapter.

41 C.F.R. § 51-6.7 (2020).

To delete items from the Procurement List, the JWOD Act implementing regulation

at 41 C.F.R. § 51-6.8 states:

(a) When a central nonprofit agency decides to request that the Committee

delete a commodity or service from the Procurement List, it shall notify the

Committee staff immediately. Before reaching a decision to request a

deletion of an item from the Procurement List, the central nonprofit agency

shall determine that none of its nonprofit agencies is capable and desirous

of furnishing the commodity or service involved.

(b) Except in cases where the Government is no longer procuring the item in

question, the Committee shall, prior to deleting an item from the

Procurement List, determine that none of the nonprofit agencies of the other

central nonprofit agency is desirous and capable of furnishing the

commodity or service involved.

(c) Nonprofit agencies will normally be required to complete production of any

orders for commodities on hand regardless of the decision to delete the

item. Nonprofit agencies shall obtain concurrence of the contracting activity

and the Committee prior to returning a purchase order to the contracting

activity.

(d) For services, a nonprofit agency shall notify the contracting activity of its

intent to discontinue performance of the service 90 days in advance of the

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termination date to enable the contracting activity to assure continuity of the

service after the nonprofit agency’s discontinuance.

(e) The Committee may delete an item from the Procurement List without a

request from a central nonprofit agency if the Committee determines that

none of the nonprofit agencies participating in the AbilityOne Program are

capable and desirous of furnishing the commodity or service to the

Government, or if the Committee decides that the commodity or service is

no longer suitable for procurement from nonprofit agencies employing

people who are blind or have other severe disabilities. In considering such

an action, the Committee will consult with the appropriate central nonprofit

agency, the nonprofit agency or agencies involved, and the contracting

activity.

41 C.F.R. § 51-6.8 (2020).

With regard to replacement and similar commodities, the JWOD Act implementing

regulations indicate:

(a) When a commodity on the Procurement List is replaced by another

commodity which has not been recently procured, and a nonprofit

agency can furnish the replacement commodity in accordance with the

Government’s quality standards and delivery schedules, the

replacement commodity is automatically considered to be on the

Procurement List and shall be procured from the nonprofit agency

designated by the Committee at the fair market price the Committee has

set for the replacement commodity. The commodity being replaced shall

continue to be included on the Procurement List until there is no longer

a Government requirement for that commodity.

(b) If contracting activities desire to procure additional sizes, colors, or

other variations of a commodity after the commodity is added to the

Procurement List, and these similar commodities have not recently been

procured, these commodities are also automatically considered to be on

the Procurement List.

(c) In accordance with § 51-5.3 of this chapter, contracting activities are not

permitted to purchase commercial items that are essentially the same

as commodities on the Procurement List.

41 C.F.R. § 51-6.13 (2020).

In addition, the Federal Acquisition Regulations (FAR), at Title 48 of the Code of

Federal Regulations, contains regulations which further implement the JWOD Act. See

generally 48 C.F.R. subpart 8.7. With regard to the role of AbilityOne, 48 C.F.R. § 8.703,

states:

14

The Committee maintains a Procurement List of all supplies and services

required to be purchased from AbilityOne participating nonprofit agencies.

The Procurement List may be accessed at: http://www.abilityone.gov.

Questions concerning whether a supply item or service is on the

Procurement List may be submitted at Internet email address

info@abilityone.gov or referred to the Committee offices at the following

address and telephone number: Committee for Purchase From People Who

Are Blind or Severely Disabled, 1401 S. Clark Street, Suite 10800,

Arlington, VA 22202-3259, 703-603-7740.

Many items on the Procurement List are identified in the General Services

Administration (GSA) Supply Catalog and GSA’s Customer Service Center

Catalogs with a black square and the words “NIB/NISH Mandatory Source,”

and in similar catalogs issued by the Defense Logistics Agency (DLA) and

the Department of Veterans Affairs (VA). GSA, DLA, and VA are central

supply agencies from which other Federal agencies are required to

purchase certain supply items on the Procurement List.

48 C.F.R. § 8.703 (2021). With a reference to Title 41 of the Code of Federal Regulations,

Title 48 of the FAR also lays out purchase priorities for entities of the federal government

that wish to purchase items from the Procurement List, stating:

(a) 41 U.S.C. chapter 85 requires the Government to purchase supplies or

services on the Procurement List, at prices established by the Committee,

from AbilityOne participating nonprofit agencies if they are available within

the period required. When identical supplies or services are on the

Procurement List and the Schedule of Products issued by Federal Prison

Industries, Inc., ordering offices shall purchase supplies and services in the

following priorities:

(1) Supplies:

(iii) Federal Prison Industries, Inc. (41 U.S.C. 8504).

(iv) AbilityOne participating nonprofit agencies.

(v) Commercial sources.

(2) Services:

(vi) AbilityOne participating nonprofit agencies.

(vii) Federal Prison Industries, Inc., or commercial sources.

(b) No other provision of the FAR shall be construed as permitting an exception

to the mandatory purchase of items on the Procurement List.

(c) The Procurement List identifies those supplies for which the ordering office

must obtain a formal waiver (8.604) from Federal Prison Industries, Inc.,

before making any purchases from AbilityOne participating nonprofit

agencies.

48 C.F.R. § 8.704 (2021).

15

The FAR also provides procedures for when the federal government’s needs may

exceed nonprofit production capability. The regulation at 48 C.F.R. § 8.706 states:

(a) Ordering offices may acquire supplies or services on the Procurement

List from commercial sources only if the acquisition is specifically authorized

in a purchase exception granted by the designated central nonprofit agency.

(b) The central nonprofit agency shall promptly grant purchase exceptions

when-

(1) The AbilityOne participating nonprofit agencies cannot provide

the supplies or services within the time required, and commercial

sources can provide them significantly sooner in the quantities

required; or

(2) The quantity required cannot be produced or provided

economically by the AbilityOne participating nonprofit agencies.

(c) The central nonprofit agency granting the exception shall specify the

quantity and delivery or performance period covered by the exception.

(d) When a purchase exception is granted, the contracting officer shall-

(1) Initiate purchase action within 15 days following the date of the

exception or any extension granted by the central nonprofit agency;

and

(2) Provide a copy of the solicitation to the central nonprofit agency

when it is issued.

(e) The Committee may also grant a purchase exception, under any

circumstances it considers appropriate.

48 C.F.R. § 8.706 (2021) (emphasis in original). With regard to replacement commodities,

similar to the JWOD Act implementing regulation at 41 C.F.R. § 51-6.13(a), the JWOD

Act implementing regulation at 48 C.F.R. § 8.715 provides that

[w]hen a commodity on the Procurement List is replaced by another

commodity which has not been previously acquired, and a qualified

AbilityOne participating nonprofit agency can furnish the replacement

commodity in accordance with the Government’s quality standards and

delivery schedules and at fair market price, the replacement commodity is

automatically on the Procurement List and shall be acquired from the

AbilityOne participating nonprofit agency designated by the Committee. The

commodity being replaced shall continue to be included on the Procurement

List until there is no longer a requirement for that commodity.

48 C.F.R. § 8.715 (2021).

On December 1, 2006, AbilityOne published, what it labeled a “Clarification of

Scope of Procurement List Additions; 2007 Procurement List,” in the Federal Register.

See Clarification of Scope Procurement List Additions; 2007 Commodities Procurement

List, 71 Fed. Reg. 69,535 (Dec. 1, 2006) (2006 Clarification). In the announcement, which

16

was not promulgated as a regulation in the Federal Register, AbilityOne addressed

proposed procedures for adding products to the Procurement List and announced a three-

tiered system: “A List”, “B List”, and “C List.” See id. The 2006 Clarification states with

regard to “A List” items:

The first category (the A List) contains commodity type products that are

commonly used in office and light industrial settings. These products, when

furnished by the JWOD Program, are widely available through multiple

Government and commercial distribution channels, and are delivered to

customers in timeframes consistent with industry best practices. For most

office supplies, this means on a next-day or two-day basis. For oversize

office products (e.g., chair mats), or janitorial/sanitary products, delivery

times may be three to five days after receipt of order. “A list” products must

be purchased by Federal employees whenever there are available within

required timeframes and quantities.

Id. at 69,536 (capitalization in original). With regard to “B-List” items, the 2006 Clarification

provides:

The second category (the B List) contains products that are not used in

volume in most offices, but have broad applicability across multiple Federal

agencies, and the demand for these items is aggregated by the General

Services Administration (GSA). As such, GSA is the JWOD Program’s

responsible contracting activities for these items on behalf of the rest of the

Federal Government, just as GSA fulfills this role for A List items. However,

given the B List items’ less-than-universal demand, particularly in terms of

office use, the B List items are not required to be available through all

commercial distribution channels. The B List items are available through the

Federal Supply System, as managed by GSA, and will be carried by

authorized commercial distributors who carry comparable commercial

product families. The JWOD purchasing preference extends to those items

and applies to all entities of the Government when such items meet

customers’ needs and are available in the timeframe and quantities

necessary.

Id. (capitalization in original). With regard to “C List” items, the 2006 Clarification states:

The third category (the C List) contains specialized or niche products (i.e.,

adapted to a specific function or demand) that are most often designed and

manufactured to meet the needs of a single Federal agency, or a group of

customers with a unique requirement. These products, when furnished

under the JWOD Program, are sponsored by and have procurement

preference for the specific Federal agency or agencies that defined the

17

requirement. The JWOD procurement preference does not apply to Federal

Agencies that are not identified on the Procurement List documentation for

such items. Generally, C List items are only made available to Federal

customers through the distribution channels authorized by the requiring

office. If Federal agencies whose requirements are not specified on the

Procurement List would like to purchase C list items, they must refer their

request to the sponsoring contracting activity. Alternatively, Federal

agencies may ask the Committee to change the Procurement List in order

to add their agency as an additional contracting Activity.

Id. (capitalization in original).

On August 27, 2010, AbilityOne published a Federal Register Notice, titled

“Procurement List Additions,” effective September 27, 2010, which added to the

Procurement List a series of national stock numbers for the Multi-Camouflage Trouser,

stated in this litigation by both parties to have the same national stock numbers as the

Women’s IHWCU Trousers.6 See Procurement List Additions, 75 Fed. Reg. 52,724,

52,725 (Aug. 27, 2010). The August 27, 2010 notice stated in part:

NPAs [Nonprofit Agencies]: ReadyOne Industries, Inc., El Paso, TX

Goodwill Industries of South Florida, Inc., Miami, FL

Contracting Activity: Department of the Army Research, Development, &

Engineering Command, Natick, MA.

Coverage: C-List for 50% of the requirement of the U.S. Army, as

aggregated by the Department of the Army Research, Development, &

Engineering Command, Natick, MA.

6 The court notes that both parties strenuously asserted and both parties agreed during

the course of the litigation in the above captioned protest that the unisex IHWCU Trousers

were added to the Procurement List as a variation of the Multi-Camouflage Trouser. See

Procurement List Additions, 75 Fed. Reg. 52,724, 52,725 (Aug. 27, 2010); see also 41

C.F.R. § 51-6.13. The court accepts the protestor’s and defendant’s definition of the

Women’s IHWCU Trouser as a replacement item for the unisex IHWCU Trouser and,

therefore, as an item that is “automatically considered to be on the Procurement List” as

of September 27, 2010. See 41 C.F.R. § 51-6.13. The court observes that the trousers’

sizing and designation changed from unisex to female through the January 11, 2021

Notice of Addition published in the Federal Register discussed below. The Administrative

Record does not offer details on the differences between the unisex and the female

trousers, and neither party alleged that the differences between the unisex and the female

trousers was relevant to the above captioned bid protest.

18

See Procurement List Additions, 75 Fed. Reg. 52,724, 52,725 (Aug. 27, 2010) (emphasis

in original; alteration added).

On November 28, 2017, AbilityOne issued a Notice of Addition in which AbilityOne,

citing 41 C.F.R. § 51-6.13(b),7 added the unisex IHWCU Trouser to the Procurement List

under Procurement List Number 20105144. The November 28, 2017 Notice indicated:

Distribution: C-List

Contracting Activity: Army Contracting Command – Aberdeen Proving

Ground, Natick Contracting Division

Mandatory for: 50% of the requirement of the U.S. Army

Designated Mandatory Source(s) of Supply: Goodwill Industries of South

Florida, Inc., Miami, FL, a nonprofit agency associated with SourceAmerica,

is authorized to accept orders for the products listed above.

(emphasis in original).

On November 17, 2021, Evan Eisenberg, the contracting officer for the

procurement challenged in the above captioned protest, issued a Memorandum for

Record which provided the following background:

The U.S. Army Natick Soldier Systems (Natick) developed the Improved

Hot Weather Combat Uniform (IHWCU) to meet the needs of warfighters

deployed to hot weather desert and/or tropical locations. Natick serves as

the research and development center for the Army. The IHWCU is intended

to serve as an alternative to the Army Combat Uniform (ACU) for those

environments. The IHWCU consists of a coat and trousers. The initial

development and fielding of the IHWCU relied on a unisex sizing tariff that

was intended to meet the needs of both male and female warfighters.

The Memorandum for Record continued,

[a]fter developing and transmitting the SRP [supply request package] for the

IHWCU, Natick then developed a more specific sizing tariff and design for

female soldiers – the IHWCU-F. Due to congressional inquiries regarding

the availability of female specific uniforms and equipment, there was

increased pressure on the Army to field the uniforms as quickly as possible.

(alteration added).

7 41 C.F.R. § 51-6.13(b) provides, in full, that “[i]f contracting activities desire to procure

additional sizes, colors, or other variations of a commodity after the commodity is added

to the Procurement List, and these similar commodities have not recently been procured,

these commodities are also automatically considered to be on the Procurement List.”

19

On January 11, 2021, AbilityOne issued a Notice of Addition which added the

Women’s IHWCU Trousers to the Procurement List. The January 11, 2021 Notice of

Addition stated in its entirety:

PROCUREMENT LIST

NOTICE OF ADDITION

TO: Army Contracting Command – Aberdeen Proving Ground, Natick Contracting

Division

SourceAmerica

In accordance with 41 CFR 51-6.13(b), the U.S. AbilityOne Commission

(Commission) has determined that the following products are additional

sizes, colors, or other variations of products already on the Procurement

List (PL) and that these products have not recently been procured.

Accordingly, the products are automatically considered to be on the PL at

the Fair Market Prices (FMP) indicated

Product Name: Trouser, Improved Hot Weather Combat Uniform

(IHWCU), Permethrin, Women’s, Army

Product NSN Size

8415-01-687-6651 25-X Short

8415-01-687-6669 25-Short

8415-01-687-3100 25-Regular

8415-01-687-6659 28-A Short

8415-01-687-6201 28-Short

8415-01-687-6555 28-Regular

8415-01-687-6180 28-Long

8415-01-687-1971 31-X Short

8415-01-687-1339 31-Short

8415-01-687-1353 31-Regular

8415-01-687-6673 31-Long

8415-01-687-2126 31-X Long

8415-01-687-6147 35-Short

8415-01-687-2060 35-Regular

8415-01-687-1345 35-Long

8415-01-687-4018 35-X Long

The following information is applicable to all products listed above

20

Product Description: The Improved Hot Weather Combat Uniform

(IHWCU) trouser has one (1) button/buttonhole closure with seven (7) belt

loops along with a covered fly with three (3) buttons and buttonhole closure,

two (2) side hanging pockets, two (2) front side pleated cargo pockets with

three (3) buttons/two (2) buttonholes closure flaps. The trousers include a

double needle seat patch and knee reinforcement patches and a mesh

fabric attached on the inside of the trousers at the bottom of the legs as

inner cuffs. Both the bottom of the trousers legs and the inner cuffs have

drawstrings. The trouser is treated with permethrin, wind resistant, and

wrinkle free. UOI [Unit of Issue] is PR.

Unit of issue: PR

FMP Category: Post Treated Garment - Rapid Fielding

FMP Change Mechanism: Negotiated

FOB Origin FMP: $62.34

FOB Destination FMP: $62.50

In accordance with 41 CFR 51-2.7, change to the FMP [Fair Market Price]

outside of the approved methodology above and provisions in the U.S.

AbilityOne Pricing Policy 51.610, Pricing AbilityOne Products, must be

approved by the Commission before a contract is awarded or an existing

contract is modified.

Distribution: C-List

Contracting Activity: Army Contracting Command - Aberdeen Proving

Ground, Natick Contracting Division

Mandatory for: 50% of the requirement of the Department of Defense

Designated Source of Supply: Goodwill Industries of South Florida, Inc.,

Miami, FL, a nonprofit agency associated with SourceAmerica, is

authorized to accept orders for the products listed above.

This addition to the Procurement List is effective the date of this notice. In

accordance with 41 CFR 51-5.3, this change does not affect contracts for

the product awarded prior to the effective date of the Procurement List

addition or options exercised under those contracts. Please direct questions

regarding this Notice to Operations@abilityone.gov.

21

(capitalization and emphasis in original; alteration added). 8

Solicitation No. SPE1C1-21-R-0029, the one at issue in this protest, for the

procurement of Women’s Improved Hot-Weather Combat Uniform (IHWCU) Trousers

was issued by the DLA for troop sustainment on April 26, 2021. As indicated above,

protestor argues that according to the Procurement List maintained by the AbilityOne,

Goodwill Industries of South Florida is the mandatory source of supply for the Women’s

IHWCU Trousers and that procurement from any source but Goodwill Industries of South

Florida violates procurement statutes and regulations. Protestor’s complaint indicates that

“Goodwill [Industries of South Florida] has received, has performed, and is performing

one or more military contracts for the Goodwill items.” Goodwill Industries of South

Florida’s bid protest complaint alleges that protestor had “received Contract No.

W911QY-21-C-0042, to supply the Women’s IHWCU Trousers,” which “are in production

at Goodwill [Industries of South Florida].” (alteration added).

Defendant acknowledges that

[a]fter the Commission allocated a portion of the Army’s requirement for

combat pants to the Procurement List, Army-Natick issued a series of

product development contracts to Goodwill. See AR Tab 46, at 1053

(Goodwill’s project development plan noting that it has produced IHWCU-F

trousers “under complete M&D contracts,” that is—manufacture and

development contracts).

Additionally, defendant acknowledges that Goodwill Industries of South Florida was

producing the Women’s IHWCU Trousers during what defendant characterizes as the

development phase, and that once the design was finalized, AbilityOne issued the

January 11, 2021 Notice of Addition, which added the Women’s IHWCU Trousers to the

Procurement List. Defendant also states that “[a]fter the Commission allocated a portion

of the Army’s requirement for combat pants to the Procurement List, Army-Natick issued

a series of product development contracts to Goodwill,” and notes that “Army -Natick’s

most recent contract with Goodwill [Industries of South Florida] called for 68,991 pants to

be delivered in monthly installments in quantities ranging from 2,000 to 6,370.” (alteration

8 Protestor’s complaint alleges that it received a Notice of Change, dated April 8, 2021,

which was similar to the January 11, 2021 Notice of Addition. The April 8, 2021 Notice of

Change to the Procurement List that was issued by AbilityOne for the “Army Contracting

Command - Aberdeen Proving Ground, Natick Contracting Division,” similarly dated April

8, 2021, changed a single Product NSN: 8415-01-687-6555, and noted: “Product Name:

Trouser, Improved Hot Weather Combat Uniform (IHWCU), Permethrin, Women’s, Army,

28-Regular.” (capitalization and emphasis in original). AbilityOne then issued a revised

Notice of Addition on November 9, 2021, in which AbilityOne changed “the Mandatory for

[sic] statement from Department of Defense to U.S. Army.” (capitalization in original ;

alteration added).

22

added). The defendant indicates that when Army-Natick subsequently proposed to add a

portion of its requirement for the Women’s IHWCU Trousers to the Procurement List, its

estimated annual quantity was contemplated to be 86,688 trousers.

Defendant identifies that the procuring agency, “DLA is a ‘defense agency’ under

the authority, direction, and control of the Department of Defense.” See 10 U.S.C. §§

191–92; see also DoDD 5105.22 (June 29, 2017). Defendant also indicates, with respect

to the DLA:

The agency’s primary mission is to “manage[s] [sic] the global supply

chain—from raw materials to end user to disposition—for the Army, Marine

Corps, Navy, Air Force, Space Force, Coast Guard, 11 combatant

commands, other federal agencies, and partner and allied nations.” DLA

Troop Support requirements are unique given that it is responsible for

“manag[ing] the supply chains for food, textiles, construction material,

industrial hardware and medical supplies and equipment, including

pharmaceuticals.” Within DLA Troop Support, the clothing and textiles

supply chain “outfit[s] every soldier, sailor, airman and Marine around the

world, from their first day of service in boot camp, to camouflage uniforms

worn on the battlefield and service dress uniforms.”

(capitalization in original; first and third alterations in original; citations omitted).

The regulation at 48 C.F.R. § 8.703 provides that “GSA, DLA, and VA are central

supply agencies from which other Federal agencies are required to purchase certain

supply items on the Procurement List.” 48 C.F.R. § 8.703. In addition, citing to Department

of Defense Instruction (DoDI) 4140.63 ¶¶ 2.4, 2.6 (June 7, 2019), defendant explains that

“[a]lthough DLA manages various supply chains for the services, the military services’

research and engineering arms are typically responsible for developing the products —

e.g., Army weapons, Air Force helicopter motors, Navy coats—to meet their particular

needs.” Because Army-Natick is the research and development center for the Army, as

stated in the Army Statement of Work for the Army Combat Pants in the earlier related

protest, Goodwill Industries of South Florida, Inc. v. United States, 156 Fed. Cl. 661

(2021) (Goodwill I), submitted as part of the Administrative Record in the current protest,

“[w]hen testing a uniform design, Army-Natick often develops a specification and field

tests the design with specific units or at specific installations.” According to the November

17, 2021 Memorandum for Record by the contracting officer, Evan Eisenberg, also stated,

“[p]roduction requirements during research and development are typically narrow,” and

“Natick generally procures items during the research and development phase of new

items when requirements are much smaller.” Additionally, the November 17, 2021

Memorandum for Record stated that the efforts undertaken at Army-Natick “‘do not

typically involve the same or similar scope and magnitude of effort that DLA Troop

Support requires for sustainment of the item.’” According to DoDI 4140.63, ¶ 2.3 (Apr. 12,

2019), after Army-Natick completes research and development on a particular item of

“DoD clothing and textiles material,” Army-Natick may transfer the requirement to the DLA

23

for the procurement, management, and supply of products made in accordance with that

item, which is generally referred to as “sustainment.” At the “sustainment” level, the DLA

develops acquisition strategies and awards contracts to support Department of Defense

requirements. See DoDI 4140.01, at 22 (Mar. 6, 2019). The DLA administers the contracts

and awards follow-on contracts to ensure the item’s availability until it receives notice that

the product is being replaced or discontinued. See id. With respect to the Women’s

IHWCU Trousers, defendant states that “[h]aving completed the technical design of the

combat pants and female improved hot weather trousers, Army-Natick transferred these

products to DLA Troop Support for procurement at sustainment levels.”

Relevant to the protest at issue, on April 26, 2021, the DLA issued solicitation No.

SPE1C1-21-R-0029 to procure the Women’s IHWCU Trousers using competitive

procedures. The government indicates in its motion for judgment on the Administrative

Record that

DLA Troop Support intends to award two IDIQ contracts—one restricted to

small businesses, the other restricted to HUBZone businesses—to procure

the female improved hot weather trousers, and to select contractors based

on best value. Because DLA Troop Support estimates a combined average

requirement of 192,000 trousers per year, awarding two contracts will

“ensure that multiple sources are available to provide for the continuous

availability of reliable sources of supplies.” On December 1, 2021, DLA

Troop Support awarded the small business contract, but the agency has not

yet awarded the HUBZone contract.

(internal citations omitted).

Prior to filing the instant protest, on May 24, 2021, Goodwill Industries of South

Florida filed a pre-award bid protest complaint in this court, challenging the solicitation

issued by DLA Troop Support for Army Combat Pants and for Women’s IHWCU Trousers,

which is also the subject of the above captioned current bid protest. See Goodwill I, 156

Fed. Cl. at 663. In Goodwill I, Goodwill Industries of South Florida sought an injunction

prohibiting federal procurement, including by the DLA, of the Women’s IHWCU Trousers,

as well as the Army Combat Pants, referred to by the protestor as the “Goodwill items,”

from any entity other than Goodwill Industries of South Florida. Id. at 671.9 In Goodwill I,

Goodwill Industries of South Florida argued that

[b]ecause Goodwill [Industries of South Florida] is the mandatory source of

supply for the Goodwill items, if DLA can issue solicitations for the Goodwill

items at all, DLA should require awardees under the Solicitations to acquire

9 In addition to the Women’s IHWCU Trousers, there was a second item from the

Procurement List at issue in Goodwill I, the Army Combat Pants. See generally Goodwill

I, 156 Fed. Cl. 661. The Army Combat Pants are not at issue in this protest.

24

the Goodwill items from Goodwill [Industries of South Florida]. DLA has not

done so. This violates 41 C.F.R. § 51-5.2.

Id. at 671 (alterations added). Therefore, in Goodwill I, Goodwill Industries of South

Florida asked this court to enjoin “federal acquisition of the Goodwill items, and any

replacement item or variation of the Goodwill items, and any item that is ‘essentially the

same’ or ‘similar,’ from any source other than Goodwill [Industries of South Florida].” Id.

(alteration added). This court dismissed Goodwill I, without prejudice, as unripe. See id.

at 680–81. At the time that protestor Goodwill Industries of South Florida filed the protest

in Goodwill I, defendant had not yet issued a final solicitation or award for the items at

issue in the protest. See id. at 677. Accordingly, this court found that

for the DLA procurement of the Army Hot-Weather Trousers, no award has

been made, and no final solicitation has been issued [for either the Army

Combat Pants or the Women’s IHWCU trousers]. Although protestor argues

that the award of a contract to anyone other than Goodwill [Industries of

South Florida] will be a violation of numerous statutes and regulations

related to the Procurement List, the anticipation of a future procurement

violation is not sufficient to make a claim ripe in a bid protest before the

court.

Id. at 675 (alteration added).

Thereafter, Evan Eisenberg, the contracting officer for solicitation No. SPE1C1-21-

R-0029, the solicitation now at issue before this court, issued his November 17, 2021

Memorandum for Record which states in part:

The U.S. Army Natick Soldier Systems (Natick) developed the Improved

Hot Weather Combat Uniform (IHWCU) to meet the needs of warfighters

deployed to hot weather desert and/or tropical locations. Natick serves as

the research and development center for the Army. The IHWCU is intended

to serve as an alternative to the Army Combat Uniform (ACU) for those

environments. The IHWCU consists of a coat and trousers. The initial

development and fielding of the IHWCU relied on a unisex sizing tariff that

was intended to meet the needs of both male and female warfighters.

Natick sent a supply request package (SRP) for the unisex IHWCU to DLA

Troop Support in 2019. Based on the Army’s fielding needs, DLA Troop

Support competitively solicited and issued contracts for the IHWCU

beginning on December 15, 2020.

After developing and transmitting the SRP for the IHWCU, Natick then

developed a more specific sizing tariff and design for female soldiers – the

IHWCU-F [Women’s IHWCU Trousers]. Due to congressional inquiries

regarding the availability of female specific uniforms and equipment, there

25

was increased pressure on the Army to field the uniforms as quickly as

possible. The SRP was approved November 2020, and the Army wanted to

begin to be able to issue the IHWCU-F according to its fielding plan in July

2021. The production lead time for the item is 180 days for initial deliveries

and 150 days for subsequent deliveries. DLA had to develop an acquisition

strategy to try supply the IHWCU-F as close to the Army’s desired

timeframes as possible while taking into consideration the practical realities

of soliciting and awarding contracts having long production lead times.

As part of its initial acquisition planning, DLA Troop Support conducted

market research to test the domestic industrial market as to interest and

production capabilities. Although requirements for sustaining uniform items

after development are routinely transferred to DLA Troop Support via the

SRP process, DLA Troop Support does not normally consider performance

on Natick contracts as part of its market research analysis. This is because

Natick generally procures items during the research and development

phase of new items when requirements are much smaller, and the efforts

do not typically involve the same or similar scope and magnitude of effort

that DLA Troop Support requires for sustainment of the item.

Based on its market research, DLA determined that the solicitation would

contain two lots resulting in two long term contracts for these items. Both

lots contain the IHWCU-F coats and trousers. One lot is set aside for small

businesses and the other lot is set aside for HUBZone small businesses.

Because the acquisition timeline would not permit DLA Troop Support to

have sufficient quantities of the IHWCU-F coats and trousers available to

issue to female personnel starting in July 2021, on December 9, 2020, DLA

Troop Support modified a previously-issued solicitation for IHWCU (unisex)

coats and trousers to add a portion of its requirements for ICHCU-F coats

and trousers. Two contracts were awarded pursuant to that solicitation,

each with a monthly maximum of 30,000: SPE1C1-D-1449, awarded on

March 9, 2021 (IWHCU coats and IHWCU-F coats); and SPE1C1-21-D-

1456, awarded on April 7, 2021 (IWHCU trousers and IHWCU-F trousers).

Adding the IHWCU-F to the previously-issued IHWCU solicitation and

awards was intended to provide additional support for female personnel

until the long-term contracts for the IHWCU-F could be put in place. As a

short-term stopgap measure, DLA also requested the Army to place an

order under Natick’s existing contracts for a quantity of 69,000 IHWCU-F

coats and 69,480 IHWCU-F trousers. DLA Troop Support supported the

request through a Military Interdepartmental Purchase Request (MIPR)

which is a method to transfer funds from one military organization to

another. DLA Troop Support was aware that the Army’s contracts were with

Ability One for the IHWCU-F coats and trousers. Seeking the additional

quantities under Natick’s contracts was intended to assist DLA Troop

26

Support with building up the initial inventory needed while contracts were

being awarded and production ramped up under the long-term contracts.

(capitalization in original; alteration added). The November 17, 2021 Memorandum for

Record continues:

The contracting team discussed the Court’s decision with agency counsel

and reviewed counsel’s memorandum outlining the legal requirements

related to items on the PL [Procurement List]. Based on a counsel’s

comments, and a review of the rules governing acquisitions from Ability One

nonprofit agencies/workshops, especially the Commission’s Clarification of

Scope of Procurement List Additions; 2007 Commodities Procurement List

71 Fed. Reg. 69,535, 69,536 (Dec. 1. 2006)), DLA Troop Support does not

consider the current identification of the IHWCU-F Trouser or Coat on the

C list, with Natick as the designated contracting activity, to indicate that DLA

must acquire the item directly from an Ability One nonprofit

agency/workshop.

In reaching this decision, DLA Troop Support considered the fact that the

Procurement Notice of Addition that added the IHWCU-F to the PL identifies

the item as being a C list item, which from the 2006 Clarification means that

it is a specialized item designed to meet the needs of a single Agency or

group of customers. Further the 2006 Clarification indicated that the

products on the C list are only mandatory for the agency which sponsored

them. In this case, Natick has been designated as the Agency that

sponsored the addition of the IHWCU-F Coat and Trouser to the PL. DLA

Troop Support was not consulted by Natick, an Ability One nonprofit agency

or even the Ability One Commission regarding the addition of the IHWCU-

F coat or trouser to the PL, and thus had no opportunity to weigh in

regarding the scope of future acquisitions that DLA Troop Support may be

required to fulfill. Here the current solicitation has a monthly maximum

quantity of 13,333 trousers and 13,333 coats for each lot. These quantities

are more than double what Goodwill is producing on Natick’s contract for

the trousers and what Ready One or IOB Greensboro is producing on

Natick’s contracts for the coat. The identification of the contracting activity

on the PL is meaningful, since just because the Ability One Commission

determined that one or more workshops can satisfy the needs of Natick, it

does not mean that the Ability One Commission has determined that those

workshops can satisfy the much larger needs of a different contracting

activity such as DLA Troop Support.

While it might be possible to acquire a smaller percentage of the total

quantity needed from an Ability One nonprofit workshop, DLA does not

consider it to be in the government’s best interest to apportion a percentage

27

to Ability One for the IHWCU-F coats and trousers. When determining the

monthly maximums and estimated monthly orders under a contract, DLA

Troop Support is taking into consideration reasonable economic production

runs needed to keep a production line running. DLA Troop Support also

must comply with the requirements of the Competition in Contracting Act

(CICA), 10 U.S.C. §2304 which requires that procurements for property

must be obtained through full and open competition unless an exception

applies. Since the IHWCU-F trouser and coats are not mandatory for DLA

Troop Support to acquire from an Ability One nonprofit agency/workshop,

there is no basis for DLA Troop Support to order even a small percentage

from Ability One unless DLA Troop Support seeks to place a portion on the

PL.

In developing an acquisition strategy, and even in considering whether to

seek to request that an item, or percent of an item, be placed on the PL as

mandatory for DLA Troop Support to acquire, DLA Troop Support considers

the domestic industrial base as a whole. Due to the domestic sourcing

restrictions of the Berry Amendment (10 U.S.C. 2533a), all uniform items,

such as the IHWCU-F Trouser are required to be 100% domestically

manufactured, including all the components. There is an extremely limited

domestic industrial base that manufactures clothing components from fiber

to finished product, and part of DLA Troop Support’s acquisition strategy is

to ensure that there is sufficient demand and domestic capability to ensure

the health and strength of that domestic base. After reviewing its

requirements and taking into account the capabilities of commercial

domestic manufacturers, DLA Troop Support does not consider it beneficial

to seek to request the Ability One Commission to place a portion or

percentage of the IHWCU-F trouser or coat on the PL as mandatory for DLA

Troop Support because shifting even a small quantity of production away

from the commercial acquisitions to Ability One would result in lower

monthly production runs which could discourage competition, drive up

prices and/or result in companies having to reduce their workforce due to

the lower production quantities.

Therefore, based on the above, DLA Troop Support has determined that it

is in the government’s best interests to continue with its competitive

acquisition for the IHWCU-F coats and trousers and not to seek to place

these items on the PL as mandatory for DLA Troop Support as the

contracting activity, either in whole or part at this time.

(capitalization and emphasis in original).

28

After solicitation No. SPE1C1-21-R-0029 was issued on April 26, 2021,10 protestor

filed the above captioned post-award bid protest, which similar to Goodwill I, alleges three

claims. First, protestor, again, “objects to any solicitation by a Federal agency for bids or

proposals for a proposed contract or to a proposed award or the award of a contract for

federal procurement of the Goodwill items (or similar items, etc.) from anyone other than

Goodwill [Industries of South Florida].” (emphasis in original; alteration added). In count

two, protestor “seeks injunctive relief prohibiting DLA from procurement of the Goodwill

items (or ‘similar’ items, etc.) from anyone other than Goodwill [Industries of South

Florida].” (emphasis in original; alteration added). Finally, in count three, protestor alleges

that “[b]ecause Goodwill [Industries of South Florida] is the mandatory source of supply

for the Goodwill items, if DLA can issue solicitations for the Goodwill items at all, DLA

should require awardees under the Solicitations to acquire the Goodwill items from

Goodwill [Industries of South Florida].” (alteration added).

After an initial hearing in the protest currently under review, the parties filed cross-

motions for judgment on the Administrative Record. In protestor’s motion for judgment on

the Administrative Record, Goodwill Industries of South Florida argues that if an item is

on the Procurement List, it creates a mandatory source of supply for the government,

including the DLA. Furthermore, according to protestor: “Goodwill maintains that as the

mandatory source of supply, it should not have had to submit a proposal to DLA in order

to be awarded this requirement.” Goodwill Industries of South Florida also contends that

“the presence of the Hot-Weather [the Women’s IHWCU] Trousers on the Procurement

List mandates that every federal agency, including DLA, purchase these items from

Goodwill [Industries of South Florida].” (alterations added). In the defendant’s cross-

motion for judgment on the Administrative Record, defendant, however, argues that “the

JWOD Act does not require all entities of the federal government to procure items on the

procurement list through the AbilityOne program,” or to procure 100% of their

requirements through AbilityOne. Defendant states:

Goodwill [Industries of South Florida]’s protest rises and falls on its

suggestion that the addition of any product on the Procurement List is

without limitation such that all portions of the government must procure

100% of their requirements for that product through the AbilityOne program.

But no procurement statute or regulation imposes that categorical mandate.

On the contrary, at least three [AbilityOne] Commission regulations

authorize the Commission to place scope limitations by adding portions of

a product requirement to the Procurement List.

10 As indicated above, solicitation No. SPE1C1-21-R-0029 specified the award of two

IDIQ contracts, one restricted to small businesses and one restricted to HUBZone

businesses. When the above captioned protest was filed, the DLA had awarded one but

not both of the contracts. Accordingly, the parties in their documents sometimes refer to

the above captioned protest as pre-award and at other times post-award.

29

(alteration added). Specifically, the government contends that the procurement list applies

only to “Army-Natick’s purchases of 50% of Army’s requirements” of Women’s IHWCU

Trousers and “[t]he Commission’s 2006 clarification further demonstrates that DLA Troop

Support is not required to purchase the Female Improved Hot Weather Trousers through

the AbilityOne Program.”

In response, protestor argues that the Women’s IHWCU Trousers are “on the

JWOD ‘Procurement List,’” and that “[u]nder the JWOD Act (and relevant regulations),

the item must be made by a workshop until a rational finding is made that no workshop

can make it.” Protestor alleges that since “[t]here has been no such finding,” and that the

“DLA’s award of a contract for production of the item to a commercial contractor, instead

of a workshop, is a violation of the JWOD Act (and relevant regulations).” After the parties

briefed the cross-motions for judgment on the Administrative Record, the court held oral

argument. In response to the stated immediate urgency of the protest as represented by

the parties, the court subsequently issued its decision orally to the parties. The court’s

oral decision granted protestor’s motion for judgment on the Administrative Record

including injunctive relief, effective immediately at the time of the oral decision. As noted

above, this Opinion incorporates and memorializes the court’s oral decision.

DISCUSSION

As noted above, protestor and defendant have filed cross-motions for judgment on

the Administrative Record. Rule 52.1 (2021) of the Rules of the United States Court of

Federal Claims (RCFC) governs motions for judgment on the Administrative Record. The

court’s inquiry is directed to “‘whether, given all the disputed and undisputed facts, a party

has met its burden of proof based on the evidence in the record.’” Mgmt. & Training Corp.

v. United States, 115 Fed. Cl. 26, 40 (2014) (quoting A & D Fire Prot., Inc. v. United

States, 72 Fed. Cl. 126, 131 (2006)); see also PGLS, LLC v. United States, 152 Fed. Cl.

59, 67 (2020); Superior Optical Labs, Inc. v. United States, 150 Fed. Cl. 681, 691 (2020)

(citing Bannum, Inc. v. United States, 404 F.3d 1346, 1356–57 (Fed. Cir. 2005)); see also

AAR Manufacturing, Inc. v. United States, 149 Fed. Cl. 514, 522 (2020); Glocoms, Inc. v.

United States, 149 Fed. Cl. 725, 731 (2020); Centerra Grp., LLC v. United States, 138

Fed. Cl. 407, 412 (2018) (citing Bannum, Inc. v. United States, 404 F.3d at 1356–57);

Informatics Applications Grp., Inc. v. United States, 132 Fed. Cl. 519, 524 (2017);

Strategic Bus. Sols., Inc. v. United States, 129 Fed. Cl. 621, 627 (2016), aff’d, 711 F.

App’x 651 (Fed. Cir. 2018); Rotech Healthcare Inc. v. United States, 118 Fed. Cl. 408,

413 (2014); Eco Tour Adventures, Inc. v. United States, 114 Fed. Cl. 6, 21 (2013); DMS

All-Star Joint Venture v. United States, 90 Fed. Cl. 653, 661 (2010). Pursuant to RCFC

52.1, in a bid protest, the court reviews the agency’s procurement decision to determine

whether it is supported by the Administrative Record. See CW Gov’t Travel, Inc. v. United

States, 110 Fed. Cl. 462, 481 (2013); see also CR/ZWS LLC v. United States, 138 Fed.

30

Cl. 212, 223 (2018) (citing Bannum, Inc. v. United States, 404 F.3d at 1353–54).

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)),

amended the Tucker Act to establish a statutory basis for bid protests in the United States

Court of Federal Claims. See SEKRI, Inc. v. United States, 34 F.4th at 1071 (citing

Distributed Sols., Inc. v. United States, 539 F.3d 1340, 1344 (Fed. Cir. 2008); 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 (Fed. Cir. 2004)) (citing PAI Corp. v. United States, 614 F.3d 1347, 1351 (Fed. Cir.

2010))); Dell Fed. Sys., L.P. v. United States, 906 F.3d 982, 990 (Fed. Cir. 2018); 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.) (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”), reh’g denied

(Fed. Cir. 2004). In Banknote Corp. of Am., Inc. v. United States, 365 F.3d 1345 (Fed.

Cir. 2004), the Federal Circuit explained that “[u]nder 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.’” Id. at 1351 (quoting Impresa

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

Harmonia Holdings Grp., LLC v. United States, 999 F.3d 1397, 1403 (Fed. Cir. 2021);

Palantir USG, Inc. v. United States, 904 F.3d 980, 990 (Fed. Cir. 2018); AgustaWestland

North Am., Inc. v. United States, 880 F.3d 1326, 1332 (Fed. Cir. 2018); 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).

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

31

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) (2018);11 see also Mitchco Int’l, Inc.

v. United States, 26 F.4th 1373, 1384 (Fed. Cir. 2022) (applying the “‘arbitrary and

capricious’” standard of Administrative Procedure Act, 5 U.S.C. § 706(2)(A), to review of

a bid protest) (citing Impresa Construzioni Geom. Domenico Garufi v. United States, 238

F.3d at 1332); Veterans Contracting Grp., Inc. v. United States, 920 F.3d 801, 806 (Fed.

Cir. 2019) (“In a bid protest, we follow Administrative Procedure Act § 706 and set aside

agency action ‘if it is arbitrary, capricious, an abuse of discretion, or otherwise not in

11 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;

(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.

32

accordance with law.’” (quoting Palladian Partners, Inc. v. United States, 783 F.3d 1243,

1252 (Fed. Cir. 2015)); Tinton Falls 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 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

(citing Savantage Fin. Servs., Inc. v. United States, 595 F.3d at 1285-86) (“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.”) (alteration added); Glenn Def. Marine

(ASIA), PTE Ltd. v. United States, 720 F.3d 901, 907 (Fed. Cir.), reh’g en banc denied

(Fed. Cir. 2013); 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 (citing Weeks Marine, Inc. v. United States, 575

F.3d at 1358) (“Stated another way, a plaintiff must show that the agency’s decision either

lacked a rational basis or was contrary to law.”), subsequent determination, 96 Fed. Cl.

119 (2010).

33

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 F.C.C. v. Fox Television Stations, Inc., 556 U.S. 502, 552 (2009); Tinton Falls

Lodging Realty, LLC v. United States, 800 F.3d at 1358; 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 dec ision. . . .

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

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 Dell Fed. Sys., L.P. v. United

States, 906 F.3d at 990; 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).

34

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 Mitchco Int’l, Inc. v. United States, 26 F.4th at 1384; 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); Sys. Studies & Simulation, Inc. v. United States, 146 Fed. Cl. 186, 199

(2019); By Light Prof’l IT Servs., Inc. v. United States, 131 Fed. Cl. 358, 366 (2017).

In the bid protest currently at issue, the court observes that there are tensions

between the objectives of the statutorily and regulatorily established goals of the JWOD

Act and the AbilityOne Program, both designed to provide employment opportunities to

people who are blind or who are otherwise severely disabled through a mandatory set

aside in government procurements for certain products or services, as compared to

certain objectives of the Department of Defense (and potentially other agencies) to

procure items in a timely fashion, while assuring that necessary quantities of products are

available for mission success. In the current protest, the defendant has acknowledged

that “[t]he JWOD Act established the AbilityOne program whereby agencies must procure

designated products and services on a noncompetitive basis from qualified nonprofit

agencies that provide employment opportunities for blind individuals or individuals with

severe disabilities.” The JWOD Act indicates that the “Committee on its own or in

cooperation with other public or nonprofit private agencies may study problems related to

the employment of the blind and other severely disabled individuals,” and “the

development and adaptation of production methods that would enable a greater utilization

of the blind and other severely disabled individuals.” 41 U.S.C. § 8503. The implementing

regulations at 41 C.F.R. § 51-2.2 provide that the “Committee is responsible for carrying

35

out the following functions in support of its mission,” including to

[i]nform Federal agencies about the AbilityOne Program and the statutory

mandate that items on the Procurement List be purchased from qualified

nonprofit agencies, and encourage and assist entities of the Federal

Government to identify additional commodities and services that can be

purchased from qualified nonprofit agencies. To the extent possible,

monitor Federal agencies’ compliance with JWOD requirements.

41 C.F.R. § 51-2.2(e). As discussed above, in the above captioned protest, AbilityOne

vigorously aligned itself with the defendant. AbilityOne’s counsel signed on to the

defendant’s briefs, and Kimberly M. Zeich, Deputy Executive Director and Chief Operating

Officer of the AbilityOne, provided an unwavering declaration in support of the DLA. At

the same time, Ms. Zeich’s declaration acknowledged that “[i]n conjunction with other

regulations and policies, including the Federal Acquisition Regulation (‘FAR’), and unless

otherwise excepted, the JWOD Act requires the Federal Government to procure certain

products and services from qualified nonprofit agencies (NPA) employing individuals who

are blind or are severely disabled.” Ms. Zeich, however, stated that “[a]lthough the

Commission is a mandatory source of supply for Federal agencies, it is not the singular,

mandatory procurement source for Federal agencies in all circumstances.” Without

further explanation of the JWOD Act’s impact on the choices made to proceed with a

competitive procurement, Ms. Zeich commented,

[a]lthough the Commission encourages SourceAmerica and DLA Troop

Support to request that the Commission consider whether an NPA, such as

Goodwill [Industries of South Florida], would satisfy the suitability criteria

with respect to DLA Troop Support’s requirements for these products,

based on my 13 years of experience administering the Procurement List, I

understand that DLA Troop Support is currently under no obligation to

procure these specific quantities through the AbilityOne program because

DLA Troop Support’s requirements for the female IHWCU trousers have not

been added to the Procurement List.

Also, important for the analysis in this protest, throughout the proceedings, both

protestor and defendant have vigorously urged this court, in their filings with the court and

during hearings before the court, that the Women’s IHWCU Trousers are items that are

currently on the Procurement List. Moreover, in protestor’s filings with the court, Goodwill

Industries of South Florida consistently has contended that “Goodwill [Industries of South

Florida] is both ‘capable’ and ‘desirous’ of continuing to furnish the items on the

Procurement List, i.e., the Hot-Weather Trousers.” (alteration added). Protestor relies on

a declaration submitted to the court signed by Mark Marchioli, Vice President of Business

Development for Goodwill Industries of South Florida, in which Mr. Marchioli affirmed that

“Goodwill is ready, willing, and able to provide these items [the Women’s IHWCU

Trousers].” (alteration added).

36

On January 11, 2021, AbilityOne sent a Notice of Addition to the Procurement List

which added the Women’s IHWCU Trousers to the Procurement List, and which is quoted

above. In protestor’s motion for judgment on the Administrative Record, based on the

JWOD Act and its implementing regulations, protestor argues that when an item is on the

Procurement List, a JWOD qualified nonprofit is the mandatory source of supply for the

federal government and that federal agencies, including the DLA, must purchase the

items from Goodwill Industries of South Florida, or from some other JWOD Act qualified

nonprofit. Additionally, protestor argues that “Goodwill [Industries of South Florida]

maintains that as the mandatory source of supply, it should not have had to submit a

proposal to DLA in order to be awarded this requirement.” (alteration added). Protestor

also argues that any scope limitations on purchasing Procurement List items have no

basis “in the cited statute, nor in the cited regulation [sic].” (alteration added). As noted

above, defendant, by contrast, contends that “the JWOD Act does not require all entities

of the federal government to procure items on the procurement list through the AbilityOne

program.”

In a statutory construction analysis, “[t]he first step is ‘to determine whether the

language at issue has a plain and unambiguous meaning with regard to the particular

dispute in the case.’” Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450 (2002) (quoting

Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997)); see also Republic of Sudan v.

Harrison, 139 S. Ct. 1048, 1056 (2019) (quoting Caraco Pharm. Labs., Ltd. v. Novo

Nordisk A/S, 566 U.S. 399, 412 (2012) (“We begin ‘where all such inquiries must begin:

with the language of the statute itself.’” (quoting United States v. Ron Pair Enters., Inc.,

489 U.S. 235, 241 (1989)))); Jimenez v. Quarterman, 555 U.S. 113, 118 (2009) (“As with

any question of statutory interpretation, our analysis begins with the plain language of the

statute.”); LaBonte v. United States, No. 2021-1432, 2022 WL 3329950, at *8 (Fed. Cir.

Aug. 12, 2022) (“We begin our analysis, as we must, with the pertinent statutory

language.”); Nicely v. United States, 23 F.4th 1364, 1368 (Fed. Cir. 2022) (“When

interpreting a statute, we ‘begin with the language employed by Congress. ’”

(quoting Engine Mfrs. Ass’n v. S. Coast Air Quality Mgmt. Dist., 541 U.S. 246, 252

(2004)); Wright v. Sec’y of Health and Human Servs., 22 F.4th 999, 1004 (Fed. Cir. 2022)

(“The ‘starting point’ in statutory construction ‘is the language of the statute’ —not a single

sentence or word of the statute, but rather ‘the provisions of the whole law,’ its object, and

its policy.”) (quoting Dole v. United Steelworkers of Am., 494 U.S. 26, 35 (1990)); AD

Global Fund, LLC ex rel. North Hills Holding, Inc. v. United States, 481 F.3d 1351, 1353

(Fed. Cir. 2007) (“The ‘first step “is to determine whether the language at issue has a

plain and unambiguous meaning with regard to the particular dispute in the case.”’”

(quoting Barnhart v. Sigmon Coal Co., Inc., 534 U.S. at 450 (quoting Robinson v. Shell

Oil Co., 519 U.S. at 340))); Starry Assocs., Inc. v. United States, 892 F.3d 1372, 1377

(Fed. Cir. 2018); PDS Consultants, Inc. v. United States, 907 F.3d at 1357; Bettcher

Indus., Inc. v. Bunzl USA, Inc., 661 F.3d 629, 644 (Fed. Cir.), reh’g and reh’g en banc

denied (Fed. Cir. 2011); Strategic Hous. Fin. Corp. of Travis Cnty. v. United States, 608

F.3d 1317, 1323 (Fed. Cir. 2010) (“When interpreting any statute, we look first to the

statutory language.”), reh’g and reh’g en banc denied (Fed. Cir. 2010), cert. denied, 562

37

U.S. 1221 (2011). “The plainness or ambiguity of statutory language is determined by

reference to the language itself, the specific context in which that language is used, and

the broader context of the statute as a whole.” Robinson v. Shell Oil Co., 519 U.S. at 341

(citing Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469, 477 (1992); McCarthy v.

Bronson, 500 U.S. 136, 139 (1991)); see also King v. Burwell, 576 U.S. 473, 474 (2015)

(“[W]hen deciding whether the language is plain, we must read the words ‘in their context

and with a view to their place in the overall statutory scheme.’” (quoting FDA v. Brown &

Williamson Tobacco Corp., 529 U.S. 120, 133 (2000))). In construing a statute, courts

“‘must begin with the language employed by Congress and the assumption that the

ordinary meaning of that language accurately expresses the legislative purpose.’”

Schindler Elevator Corp. v. United States, 563 U.S. 401, 407 (2011) (quoting Gross v.

FBL Fin. Servs., Inc., 557 U.S. 167, 175 (2009) (internal quotation marks omitted)). Even

“‘[w]hen terms used in a statute are undefined, we give them their ordinary meaning.’”

Schindler Elevator Corp. v. United States, 563 U.S. at 407 (quoting Asgrow Seed Co. v.

Winterboer, 513 U.S. 179, 187 (1995)); see also Unicolors, Inc. v. H&M Hennes & Mauritz,

L.P., 142 S. Ct. 941 (2022) (using the ordinary or commonplace definition of “knowledge”

to interpret statutory text); Wolfe v. McDonough, 28 F.4th 1348, 1354 (Fed. Cir. 2022) (“It

is a ‘fundamental canon of statutory construction’ that ‘unless otherwise defined, words

will be interpreted as taking their ordinary, contemporary, common meaning [] . . . at the

time Congress enacted the statute.’” (quoting Perrin v. United States, 444 U.S. 37, 42

(1979)). “[W]e consider each question [of statutory interpretation] in the context of the

statute.” Caraco Pharm. Labs., Ltd. v. Novo Nordisk A/S/, 566 U.S. at 412 (alteration

added) (citing Robinson v. Shell Oil Co., 519 U.S. at 341); Roberts v. Sea-Land Servs.,

Inc., 566 U.S. 93, 100 (2012); Bush v. United States, 655 F.3d 1323, 1329 (Fed. Cir.

2011), cert. denied, 566 U.S. 1021 (2012).

The initial inquiry into the statutory text ceases “if the statutory language is

unambiguous and ‘the statutory scheme is coherent and consistent.’” Barnhart v. Sigmon

Coal Co., 534 U.S. at 450 (quoting Robinson v. Shell Oil Co., 519 U.S. at 340); see also

King v. Burwell, 576 U.S. at 474 (“If the statutory language is plain, we must enforce it

according to its terms.”) (citing Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242,

251 (2010)); Sucic v. Wilkie, 921 F.3d 1095, 1098 (Fed. Cir. 2019) (quoting Barnhart v.

Sigmon Coal Co., 534 U.S. at 450); Bettcher Indus., Inc. v. Bunzl USA, Inc., 661 F.3d at

644; Arko Foods Int’l, Inc. v. United States, 654 F.3d 1361, 1364 (Fed. Cir. 2011)

(“‘[W]here Congress has clearly stated its intent in the language of a statute, a court

should not inquire further into the meaning of the statute.’” (quoting Millenium Lumber

Distrib., Ltd. v. United States, 558 F.3d 1326, 1328 (Fed. Cir.), reh’g denied (Fed. Cir.

2009)); Am. Airlines, Inc. v. United States, 551 F.3d 1294, 1300 (Fed. Cir. 2008). Thus,

when the “‘statute’s language is plain, “the sole function of the courts is to enforce it

according to its terms.”’” Johnson v. United States, 529 U.S. 694, 723 (2000) (quoting

United States v. Ron Pair Enters., Inc., 489 U.S. at 241 (quoting Caminetti v. United

States, 242 U.S. 470, 485 (1917))); see also Jimenez v. Quarterman, 555 U.S. at 118;

Hartford Underwriters Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6 (2000)); Bartels

Trust for the Benefit of Cornell Univ. ex rel. Bartels v. United States, 617 F.3d at 1361

38

(citing Sharp v. United States, 580 F.3d at 1237); Candle Corp. of Am. v. U.S. Int’l Trade

Comm’n, 374 F.3d 1087, 1093 (Fed. Cir.), reh’g and reh’g denied (Fed. Cir. 2004).

When interpreting the plain meaning of the statute, it is the court’s duty, if possible,

to give meaning to every clause and word of the statute. See Setser v. United States, 566

U.S. 231, 239 (2012) (“Our decision today follows the interpretive rule they invoke, that

we must ‘give effect . . . to every clause and word’ of the Act.” (omission in original)

(quoting United States v. Menasche, 348 U.S. 528, 538–39 (1955))); see also Alaska

Dep’t of Env’t Conservation v. EPA, 540 U.S. 461, 489 n.13 (2004) (“It is, moreover, ‘“a

cardinal principle of statutory construction” that “a statute ought, upon the whole, to be so

construed that, if it can be prevented, no clause, sentence, or word shall be superfluous,

void, or otherwise insignificant.”’” (quoting TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001)

(quoting Duncan v. Walker, 533 U.S. 167, 174 (2001)))); Williams v. Taylor, 529 U.S. 362,

404 (2000) (describing as a “cardinal principle of statutory construction” the rule that every

clause and word of a statute must be given effect if possible); Wolfe v. McDonough, 28

F.4th at 1354–55 (“The presumption against surplusage additional provides that a ‘Statute

should be construed so that effect is given to all its provisions, so that no part will be

inoperative or superfluous, void or insignificant.’”) (quoting Hibbs v. Winn, 542 U.S. 88,

101 (2004) (citing 2A Norman J. Singer, Statutes and Statutory Construction § 46.06, at

18186 (rev. 6th ed. 2000))); Boeing Co. v. Sec’y of the Air Force, 983 F.3d 1321, 1327

(Fed. Cir. 2020) (quoting Shea v. United States, 976 F.3d 1292, 1300 (Fed. Cir. 2020)

(“[i]t is a ‘cardinal principle of statutory construction that courts must give effect, if possible,

to every clause and word of a statute.’” (quoting Williams v. Taylor, 529 U.S. at 364)));

Sharp v. United States, 580 F.3d 1234, 1238 (Fed. Cir. 2009). Similarly, the court must

avoid an interpretation of a clause or word which renders other provisions of the statute

inconsistent, meaningless, or superfluous. See Duncan v. Walker, 533 U.S. at 174 (noting

that courts should not treat statutory terms as “surplusage”). “[W]hen two statutes are

capable of co-existence, it is the duty of the courts . . . to regard each as effective.”

Radzanower v. Touche Ross & Co., 426 U.S. 148, 155 (1976); see also Xianli Zhang v.

United States, 640 F.3d 1358, 1368 (Fed. Cir.) (citing Cathedral Candle Co. v. U.S. Int’l

Trade Comm’n, 400 F.3d 1352, 1365 (Fed. Cir. 2005)), reh’g and reh’g en banc denied

(Fed. Cir. 2011), cert. denied, 566 U.S. 986 (2012); Hanlin v. United States, 214 F.3d

1319, 1321 (Fed. Cir.), reh’g denied (Fed. Cir. 2000).

The United States Supreme Court also has held that the specific terms of a statute

supersede general terms within that statute or within another statute that might otherwise

control. See Fourco Glass Co. v. Transmirra Prods. Corp., 353 U.S. 222, 228–29 (1957)

(“Specific terms prevail over the general in the same or another statute which otherwise

might be controlling.”) (quoting D. Ginsberg & Sons v. Popkin, 285 U.S. 204, 208 (1932)));

see also Bloate v. United States, 559 U.S. 196, 207 (2010); Bulova Watch Co. v. United

States, 365 U.S. 753, 761 (1961). In addition, the Supreme Court has endorsed “the

‘normal rule of statutory construction’ that ‘identical words used in different parts of the

same act are intended to have the same meaning.’” Gustafson v. Alloyd Co., 513 U.S.

561, 570 (1995) (quoting Dep’t of Revenue of Or. v. ACF Indus., Inc., 510 U.S. 332, 342

(1994)); see also Kislev Partners, L.P. ex rel. Bahar v. United States, 84 Fed. Cl. 385,

39

389, recons. denied, 84 Fed. Cl. 378 (2008). Furthermore, when “Congress has not

‘directly spoken to the precise question at issue,’” a court shall sustain the agency’s

approach “so long as it is ‘based on a permissible construction of the statute.’” Auer v.

Robbins, 519 U.S. 452, 457 (1997) (citing Chevron U.S.A. Inc. v. Nat’l Res. Def. Council,

Inc., 467 U.S. 837, 842–43 (1984)).

Regulatory interpretation uses a similar analytical framework as is applied to

statutory interpretation. The court must carefully examine “the text, structure, history, and

purpose of a regulation before resorting to deference.” See Kisor v. Wilkie, 139 S. Ct.

2400, 2415 (2019) (citing Chevron U.S.A., Inc. v. Nat’l Res. Def. Council, Inc., 467 U.S.

at 843 n.9 (adopting the same approach for ambiguous statutes)). When the text is

unambiguous, the court need only read the plain language of the regulation. See Breland

v. McDonough, 22 F.4th 1347, 1353 (Fed. Cir. 2022); see also Bauer v. Fed. Deposit Ins.

Corp., 38 F.4th 1114, 1121 n.2 (D.C. Cir. 2022) (stating that it was unnecessary to apply

Chevron deference when the “Federal Deposit Insurance Act and its implementing

regulations” were straight forward and were not ambiguous). A Judge of the United States

Court of Federal Claims explained:

This Court construes a regulation in the same way as a statute. Tesoro

Haw. Corp. v. United States, 405 F.3d 1339, 1346–47 (Fed. Cir. 2005)

(citing Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 414–15 (1945)).

The Court’s analysis of a regulation begins with the plain language of the

regulation. See Barnhart v. Sigmon Coal Co., 5334 U.S. 438, 450 (2002)

(“As in all statutory construction cases we begin with the language of the

statute.”). If the regulatory language is clear and unambiguous, then the

Court does not need to conduct any further inquiry. Robert v. Dep’t of Navy,

440 F.3d 1341, 1350 (Fed. Cir. 2006).

Johnson v. United States, 157 Fed. Cl. 8, 18 (2021).

The United States Supreme Court in Kisor v. Wilkie wrote,

for not every reasonable agency reading of a genuinely ambiguous rule

should receive Auer deference. See Auer v. Robbins, 519 U.S. at 457. We

have recognized in applying the Auer case that a court must make an

independent inquiry into whether the character and context of the agency

interpretation entitles it to controlling weight.

Kisor v. Wilkie, 139 S. Ct. at 2416 (citing Christopher v. SmithKline Beecham Corp., 567

U.S. 142, 155 (2012)).12 By way of example, the Supreme Court in Kisor v. Wilkie

12Although not a precedential decision, as recently indicated by the United States Court

of Appeals for the Federal Circuit, an agency will receive Auer deference only if a

40

identified “some especially important markers for identifying when Auer deference is and

is not appropriate,” including “the regulatory interpretation must be one actually made by

the agency,” “the agency’s interpretation must in some way implicate its substantive

expertise,” and “[f]inally, an agency’s reading of a rule must reflect ‘fair and considered

judgment’ to receive Auer deference.” Kisor v. Wilkie, 139 S. Ct. at 2416–17. Further, the

“Court does not interpret statutes and regulations in a vacuum, the Court looks to other

relevant regulations in the same title.” Cully Corp. v. United States, 160 Fed. Cl. 360, 378

(2022). The statutory language which lays out the goals of the JWOD Act is clear and not

ambiguous as quoted above. The implementing regulations of the JWOD Act also are

clear and not ambiguous as stating the requirements of how to proceed to award

government contracts under the JWOD Act implementing regulations. See Breland v.

McDonough, 22 F.4th at 1353; see also Bauer v. Federal Dep’t of Ins. Corp., 38 F.4th at

1121 n.2.

As it relates to the above captioned protest, protestor notes that 48 C.F.R. § 8.703

specifically references the DLA. Protester quotes the regulation at 48 C.F.R. § 8.704,

which states, in part:

(a) 41 U.S.C. chapter 85 [titled “Committee for Purchase From People Who

Are Blind or Severely Disabled”] requires the Government to purchase

supplies or services on the Procurement List, at prices established by the

Committee, from AbilityOne participating nonprofit agencies if they are

available within the period required . . . .

(b) No other provision of the FAR shall be construed as permitting an exception

to the mandatory purchase of items on the Procurement List.

48 C.F.R. § 8.704 (alterations added). Protestor also cites the regulation at 48 C.F.R.

§ 8.703, which states:

Many items on the Procurement List are identified in the General Services

Administration (GSA) Supply Catalog and GSA’s Customer Service Center

Catalogs with a black square and the words “NIB/NISH [National Industries

for the Blind/National Industries for the Severely Handicapped] Mandatory

Source,” and in similar catalogs issued by the Defense Logistics Agency

(DLA) and the Department of Veterans Affairs (VA). GSA, DLA, and VA are

central supply agencies from which other Federal agencies are required to

purchase certain supply items on the Procurement List.

Id. Moreover, protestor quotes 48 C.F.R. § 8.705-1(b), which states that “[s]upply

distribution facilities in DLA and GSA shall obtain supplies on the Procurement List from

the central nonprofit agency identified or its designated AbilityOne participating nonprofit

regulation “is genuinely ambiguous and only if the interpretation is reasonable,” and

reflects the agency’s “authoritative, expertise-based, fair, or considered judgment.” Davis

v. McDonough, No. 2021-1904, 2022 WL 2824673, at *2 (Fed. Cir. July 20, 2022).

41

agency.” 48 C.F.R. § 8.705-1(b). Furthermore, citing to 41 C.F.R. § 51-6.13, 13

“Replacement and similar commodities,” and 48 C.F.R. § 8.715, “Replacement

commodities,” protestor highlights that “this mandatory source of supply applies not only

to listed items, but also — ‘automatically’ – ‘to replacement commodities,’ ‘variations,’ and

‘essentially the same,’ or ‘similar’ items.”

At the oral argument, and in its motion for judgment on the Administrative Record,

protestor’s counsel relied on the decision in PDS Consultants, Inc. v. United States, 907

F.3d 1345, to support protestor’s position that the word “shall” in the JWOD Act, in 41

U.S.C. § 8504(a),14 “means it’s required. It’s not optional or anything short of absolutely

13 41 C.F.R. § 51-6.13 provides in its entirety:

(a) When a commodity on the Procurement List is replaced by another

commodity which has not been recently procured, and a nonprofit

agency can furnish the replacement commodity in accordance with the

Government’s quality standards and delivery schedules, the

replacement commodity is automatically considered to be on the

Procurement List and shall be procured from the nonprofit agency

designated by the Committee at the fair market price the Committee has

set for the replacement commodity. The commodity being replaced shall

continue to be included on the Procurement List until there is no longer

a Government requirement for that commodity.

(b) If contracting activities desire to procure additional sizes, colors, or

other variations of a commodity after the commodity is added to the

Procurement List, and these similar commodities have not recently been

procured, these commodities are also automatically considered to be on

the Procurement List.

(c) In accordance with § 51-5.3 of this chapter [41 C.F.R.], contracting

activities are not permitted to purchase commercial items that are

essentially the same as commodities on the Procurement List.

41 C.F.R. § 51-6.13.

14 As quoted above, 41 U.S.C. § 8504(a) states:

An entity of the Federal Government intending to procure a product or

service on the procurement list referred to in section 8503 of this title shall

procure the product or service from a qualified nonprofit agency for the blind

or a qualified nonprofit agency for other severely disabled in accordance

with the regulations of the Committee and at the price the Committee

establishes if the product or service is available within the period required

by the entity.

42

mandated by the statute.” See PDS Consultants, Inc. v. United States, 907 F.3d at 1357.

In PDS Consultants, Inc. v. United States, the United States Court of Appeals for the

Federal Circuit, in considering the same section of the JWOD Act, 41 U.S.C. § 8504(a),

explained that “[t]he JWOD generally requires that federal agencies, which on its face

would include but not be limited to the VA, purchase products and services on the

[Procurement] List from designated nonprofits.” PDS Consultants, Inc. v. United States,

907 F.3d at 1349 (alteration added). In PDS Consultants, Inc. v. United States, the

Federal Circuit also explained that “[r]egulations promulgated under the JWOD Act

mandate that AbilityOne, when deciding what items to place on the [Procurement] List,

consider, among other things, the additional service or commodity’s potential to generate

employment, the nonprofit agency’s qualifications and capability to meet Government

standards and schedules, and the impact on private contractors.” Id. (citing 41 C.F.R.

§ 51-2.4) (alteration added).

At the oral argument, protestor’s counsel also cited Superior Optical Labs, Inc. v.

United States, 150 Fed. Cl. 681, 685 (2020), to argue that “the Javits-Wagner-O’Day Act

requires all government agencies – that’s the word that’s in the decision, all – to purchase

certain products and services from designated nonprofits that employ blind and otherwise

disabled people.” A Judge of the United States Court of Federal Claims in Superior Optical

Labs, Inc. v. United States stated, “[t]he Javits-Wagner-O’Day Act (‘JWOD’), 41 U.S.C.

§§ 8501–06, requires all government agencies, including the VA, to purchase certain

products and services from designated non-profits that employ blind and otherwise

disabled people. Congress enacted the JWOD to provide employment opportunities for

the blind and ‘other severely disabled’ individuals.” Superior Optical Labs, Inc. v. United

States, 150 Fed. Cl. at 685; see also Top Gun Servs., LLC v. United States, 150 Fed. Cl.

696, 700 (2020) (“Once the Committee determines that a good or service is suitable for

procurement from a qualified nonprofit agency, the Committee places that item on a

published Procurement List and a federal agency wishing to obtain that item must do so

through a qualified nonprofit agency. 41 U.S.C. § 8503.”); Bona Fide Conglomerate, Inc.

v. United States, 96 Fed. Cl. 233, 236 (2010) (“Once a good or service is added to the

Procurement List, government entities—including executive agencies—are required to

procure the good or service from a qualifying nonprofit agency (‘NPA’) at a price

established by the Committee. 41 U.S.C. §§ 48, 48(c)[15 ]; FAR 8.704.”) (alteration added).

Protestor asserts that no exceptions exist in the JWOD Act and its implementing

regulations, which allow an agency not to procure Procurement List commodities or

services from JWOD qualified nonprofits, other than when the items to be procured

Id.

15 The provision of the JWOD Act formerly at 41 U.S.C. § 48 has been recodified at 41

U.S.C. § 8504, and the provision of the JWOD Act formerly at 41 U.S.C. § 48c has been

recodified at 41 U.S.C. § 8506.

43

cannot be produced by a qualified nonprofit in sufficient quantities and/or within the

required timeframe for the procuring agency.16 Protestor argues:

By its plain meaning, and under controlling legal authority, the JWOD Act

itself expressly is Government-wide as long as “the product or service [is][17 ]

available within the period required by the” agency [41 U.S.C. § 8504(a)];

the JWOD Act clearly does not provide for, or even contemplate, set-asides

“in whole or in part.” All seven of these decisions of this Court[18 ]—and a

Federal Circuit decision, as well—cite the JWOD Act for the proposition that

the JWOD Act set-asides automatically extend throughout the entire

Federal Government. None of them suggests that the JWOD Act permits

the Committee to add an item to the Procurement List “in whole or in part.”

(first and third alterations in original).

On April 26, 2021, the DLA issued solicitation No. SPE1C1-21-R-0029 for

Women’s IHWCU Trousers, indicating that there were

two Lots for this solicitation, one set aside for HUBZone small business

concerns and one set aside for Small Business concerns. The Government

intends to award one contract per lot, making awards based upon an

integrated assessment of technical factors and price resulting in the best

value to the Government.

(capitalization in original). Solicitation No. SPE1C1-21-R-0029 was not restricted to

Goodwill Industries of South Florida, or to other JWOD Act qualified nonprofit agencies

or workshops. At the time solicitation No. SPE1C1-21-R-0029 was issued, protestor had

been producing the Women’s IHWCU trousers for Army-Natick through a merchandise

and development contract, which had been issued to Goodwill Industries of South Florida

consistent with the requirements of the Procurement List. Protestor alleges that because

Goodwill Industries of South Florida is a qualified nonprofit agency and because the DLA

16There is an exception, however, for “an industry established under chapter 307 of title

18 and that is required under section 4124 of title 18 to be procured from that industry,”

41 U.S.C. § 8504(b), a reference to “Purchase of prison-made products by Federal

departments.” 18 U.S.C. § 4124 (2018).

17The court finds it curious that protestor added brackets around “[is]” since the JWOD

Act contains the word “is.” See 41 U.S.C. § 8504(a).

18 Overall, the protestor refers to seven cases as relevant to the instant protest: PDS

Consultants, Inc. v. United States, 132 Fed. Cl. 117; Melwood Horticultural Training Ctr.,

Inc. v. United States, 153 Fed. Cl. 723; Top Gun Servs., LLC v. United States, 150 Fed.

Cl. 696; Superior Optical Labs, Inc. v. United States, 150 Fed. Cl. at 685; American

Innotek, Inc. v. United States, 128 Fed. Cl. 135 (2016); Akima Intra-Data, LLC v. United

States, 119 Fed. Cl. 520 (2014); Bona Fide Conglomerate, Inc. v. United States, 96 Fed.

Cl. 233.

44

is an “entity of the federal government,” the DLA violated the JWOD Act and implementing

regulations, by issuing a competitive solicitation, rather than seeking the production of the

items from one of the nonprofit organizations contemplated by the JWOD Act. Further, at

oral argument, protestor’s counsel stated that “[i]t’s not a normal thing for DLA to be doing

what it’s doing here and using commercial sources for an item that’s been procured from

the JWOD suppliers since time immemorial.” Protestor also asserts that there was no

finding by SourceAmerica, the appropriate central nonprofit agency, or by AbilityOne that

a qualified nonprofit organization or organizations would not be able to meet the quantity

and deadline requirements for the DLA and that absent such finding, any scope limitations

by the government violate the JWOD Act and its implementing regulations.

As indicated above, defendant responds that “[t]he JWOD Act does not require all

entities of the federal government to procure items on the Procurement List through the

AbilityOne Program.” Defendant, citing 41 U.S.C. § 8504(a) argues that

the statute does not provide that products on the Procurement List must be

procured by all entities of the Government. Rather, the statute provides that

“[a]n entity of the Federal Government intending to procure a product or

service on the procurement list [referred to in 41 U.S.C. § 8503] shall

procure the product or service from a qualified nonprofit agency for the blind

or a qualified nonprofit agency for other severely disabled in accordance

with regulations of” the Commission [AbilityOne and at the price AbilityOne

establishes if the product or service is available within the period required

by the entity].

(emphasis in original; alterations added). Additionally, defendant argues that the JWOD

Act and its implementing regulations allow an exception to the Competition in Contracting

Act and, cites to 41 U.S.C. ch. 85. Defendant argues that AbilityOne regulations authorize

AbilityOne to place scope limitations on the Procurement List by adding only portions of

a product requirement to the Procurement List. First, defendant points to the regulation

at 41 C.F.R. § 51-2.8(b) which provides that the Procurement List “identifies the name

and national stock number or item designation for each commodity, and where

appropriate, any limitation on the portion of the commodity which must be procured under

the JWOD Act.” 41 C.F.R. § 51-2.8(b). Second, defendant cites 41 C.F.R. § 51-2.5 which

provides that AbilityOne may “add a commodity or service in whole or in part to the

Procurement List.” 41 C.F.R. § 51-2.5. Third, defendant argues that 41 C.F.R. § 51-5.3(a)

authorizes AbilityOne to “place scope parameters and allocate a portion of the

requirement to the Procurement List,” and that “[w]here geographic areas, quantities,

percentages or specific supply locations for a commodity are listed, the mandatory

provisions of the JWOD Act apply only to the portion or portions of the commodity

indicated by the Procurement List.” 41 C.F.R. § 51-5.3(a). Defendant further argues that

in the protest currently before the court, “the plain language of the Procurement List

additions make clear that the additions apply only to (1) Army-Natick purchases of (2)

50% of the Army’s requirements,” as opposed to all entities of the federal government.

Therefore, defendant argues, Goodwill Industries of South Florida “simply is not a

45

mandatory source of supply for 100% of all Federal entities’ product requirements.”

(emphasis in original).

Protestor responds

if AbilityOne actually had clearly and unequivocally stated in the

Procurement List that only 50% of Army-Natick’s contractual requirements

for [sic] were being set aside for workshops, then under the JWOD Act’s

“suitability” standard, that would have been “arbitrary and capricious.” There

is no record here that establishes that 50% of Army-Natick’s contractual

requirements for the IHWCU-F trousers, and 0% of all other federal

contracting activities’ requirements, are “suitable” for workshop production.

On the contrary, 100% of the requirements for IHWCU-F trousers up to this

time have been made by workshops, and by all appearances, 100% of the

item remains “suitable” for such production in the future.

(emphasis in original; alteration added).

The court notes that the statutory language of the JWOD Act plainly provides:

An entity of the Federal Government intending to procure a product or

service on the procurement list referred to in section 8503 of this title [41]

shall procure the product or service from a qualified nonprofit agency for the

blind or a qualified nonprofit agency for other severely disabled in

accordance with regulations of the Committee and at the price the

Committee establishes if the product or service is available within the period

required by the entity.

41 U.S.C. § 8504(a) (emphasis and alteration added). Similarly, the regulatory language

of the JWOD Act provides:

(a) Nonprofit agencies designated by the Committee are mandatory

sources of supply for all entities of the Government for commodities and

services included on the Procurement List, as provided in § 51-1.2 of

this chapter.

(b) Purchases of commodities on the Procurement List by entities of the

Government shall be made from sources authorized by the Committee.

These sources may include nonprofit agencies, central nonprofit

agencies, Government central supply agencies such as the Defense

Logistics Agency and the General Services Administration, and certain

commercial distributors. Identification of the authorized sources for a

particular commodity may be obtained from the central nonprofit

agencies at the addresses noted in § 51-6.2 of this chapter.

(c) Contracting activities shall require other persons providing commodities

which are on the Procurement List to entities of the Government by

46

contract to order these commodities from the sources authorized by the

Committee.

41 C.F.R. § 51-5.2(a)–(c) (emphasis added). Further, the regulatory framework of the

JWOD Act uses mandatory language, stating that “[t]he Committee maintains a

Procurement List which includes the commodities and services which shall be procured

by Government departments and agencies under the JWOD Act from the nonprofit

agency(ies) designated by the Committee.” 41 C.F.R. § 51-2.8(a) (emphasis added). The

mandatory language of the JWOD Act and implementing regulations, as noted above,

does not differentiate among federal entities which wish to procure items on the

Procurement List. Only specific statutory exceptions, such as those pertaining to the

prison industries provision, see 41 U.S.C. § 8504(b), are situations in which a qualified

nonprofit or multiple nonprofits cannot provide the product or service identified by the

agency “within the period required by the entity.” See 41 U.S.C. § 8504(a). The

implementing regulations provide the procedures for when a qualified nonprofit cannot

meet the deadline required by a federal entity.

The regulation at 41 C.F.R. § 51-6.7 which governs “Orders in excess of nonprofit

agency capability,” provides:

Nonprofit agencies shall take those actions necessary to ensure that they

can ship commodities within the time frames specified by the Government.

In instances where the nonprofit agency determines that it cannot ship the

commodity in the quantities specified by the required shipping date, it shall

notify the central nonprofit agency and the contracting activity. The central

nonprofit agency shall request a revision of the shipping schedule which the

contracting activity should grant, if feasible, or the central nonprofit agency

shall issue a purchase exception authorizing procurement from commercial

sources as provided in § 51-5.4 of this chapter.

41 C.F.R. § 51-6.7(b). Moreover, as indicated in 41 C.F.R. § 51-6.7(b), the regulation at

41 C.F.R. § 51-5.4 provides the procedures for obtaining a purchase exception for a

Procurement List included item:

(a) A central nonprofit agency will normally grant a purchase exception for

a contracting activity to procure from commercial sources commodities

or services on the Procurement List when both of the following

conditions are met:

(1) The central nonprofit agency or its nonprofit agency(ies) cannot

furnish a commodity or service within the period specified, and

(2) The commodity or service is available from commercial sources

in the quantities needed and significantly sooner than it will be

available from the nonprofit agency(ies).

47

(b) The central nonprofit may grant a purchase exception when the quantity

involved is not sufficient to be furnished economically by the nonprofit

agenc(ies).

(c) The Committee may also grant a purchase exception for the reasons set

forth in paragraphs (a) and (b) of this section.

41 C.F.R. § 51-5.4(a)–(c). Therefore, if a nonprofit determines that it cannot furnish

Procurement List items to the procuring agency by the deadline required, see 41 C.F.R.

§ 51-6.7, or if AbilityOne or an appropriate central nonprofit agency, finds that a qualified

nonprofit or combination of nonprofits would not be able to meet the deadline, then the

appropriate central nonprofit agency or AbilityOne is authorized under the JWOD Act

implementing regulations to issue a purchase exception to the procuring agency to obtain

Procurement List items from commercial suppliers. See 41 C.F.R. § 51-5.4. Also, in

instances in which the appropriate central nonprofit agency properly finds that JWOD

qualified nonprofits “cannot provide the supplies or services within the time required, and

commercial sources can provide them significantly sooner in the quantities required,” 48

C.F.R. § 8.706(b)(1), or when “[t]he quantity required cannot be produced or provided

economically by an AbilityOne participating nonprofit agencies, the central nonprofit

agency granting the exception shall specify the quantity and delivery or performance

period covered by the exception.” 48 C.F.R. § 8.706(b)–(c); see also SEKRI, Inc. v. United

States, 34 F.4th at 1068 (“[P]urchase exceptions are appropriate under the FAR when

the nonprofit agency cannot provide the commodities in sufficient quantities or cannot

meet the required deadline.”).

In addition, AbilityOne “may, by rule made in accordance with the requirements of

section 553(b) to (e) of title 5, add to and remove from the procurement list products so

produced and services so provided.” 41 U.S.C. § 8503(b); see also PDS Consultants v.

United States, 907 F.3d at 1349 (AbilityOne “can make changes to the [Procurement] List

by posting notice in the Federal Register and following the notice and comment

procedures set forth in the Administrative Procedure Act.”) (alteration in original). With

only a few specific exceptions, identified above, the unambiguous words of limitation in

the JWOD Act statutory language, state, “if the product or service is available within the

period required by the entity,” allows a limitation on the mandatory source requirement

only when AbilityOne or the appropriate central nonprofit agency has determined that a

qualified nonprofit or qualified nonprofits cannot furnish the products in the timeframe

required by the procuring agency. As explained by the United States Supreme Court, “[i]f

the statutory language is plain, we must enforce it according to its terms.” King v. Burwell,

576 U.S. at 474 (citing Hardt v. Reliance Standard Life Ins. Co., 560 U.S. at 251).

In SEKRI, Inc. v. United States, 34 F.4th 1063, the United States Court of Appeals

for the Federal Circuit stated that “the AbilityOne Program is a complex system of

government procurement that imposes specific obligations on the government, central

nonprofit organizations, and nonprofit agencies that employ the blind and severely

48

disabled.” Id. at 1072. Although discussing the issue of standing, the Federal Circuit

acknowledged that JWOD qualified nonprofits like protestor SEKRI, Inc.

have established economic interest bona fides because they have been

qualified under the AbilityOne Program and are a mandatory source.

Congress has established that such entities must be prioritized over other

commercial sources, absent special circumstances. See 41 U.S.C.

§ 8504(a); see also 41 C.F.R. § 51–5.4 (providing for purchase exceptions);

48 C.F.R. § 8.706 (same).

SEKRI, Inc. v. United States, 34 F.4th at 1072. In addition, The Federal Circuit continued,

it would not make sense to impose upon mandatory sources an affirmative

obligation to monitor the federal government’s solicitations to identify

attempts to circumvent the AbilityOne Program and immediately bring

agency protests, especially where the JWOD Act places an affirmative

obligation on procuring agencies to determine whether the procurement is

subject to a mandatory source. Here, the onus is on the procuring agency,

not the nonprofit agency participating in the AbilityOne Program. See 41

U.S.C. § 8504(a) (requiring federal procuring agencies to procure certain

goods from a qualified nonprofit agency under the AbilityOne Program); see

also 41 C.F.R. §§ 51–1.2(a), 51–5.2. This is not to say that procuring

agencies have no way out of the JWOD procurement regime. To lawfully

procure the ATAP from a commercial source other than SEKRI through

competitive bidding, the government should have obtained a purchase

exception from SourceAmerica or the Committee. See 41 C.F.R. § 51–5.4;

48 C.F.R. § 8.706. The government does not show that it ever obtained, or

even sought, a purchase exception. On the record before us, therefore, the

government was required to procure the ATAP [Advanced Tactical Assault

Panel] from SEKRI using the appropriate process under the AbilityOne

Program. See 41 C.F.R. §§ 51–5.4, 51–6.1 (direct order process), 51–6.2

(allocation process); 48 C.F.R. §§ 8.705–2 (direct order process), 8.705–3

(allocation process).

SEKRI, Inc. v. United States, 34 F.4th at 1072–73 (alteration added).

Separate from the recent Federal Circuit decision in SEKRI, Inc. v. United States,

a number of earlier decisions issued by Judges of the United States Court of Federal

Claims are consistent with this court’s interpretation regarding the mandatory nature of

the JWOD Act and its implementing regulations. In Melwood Horticultural Training Center,

Inc. v. United States, 153 Fed. Cl. 723, a Judge of this court wrote:

Once a product or service is added to the Procurement List, it remains in

the AbilityOne program unless the Commission “determines that none of

the nonprofit agencies participating in the AbilityOne Program are capable

49

and desirous of furnishing the commodity or service to the Government, or

if [AbilityOne] decides that the commodity or service is no longer suitable

for procurement from nonprofit agencies employing people who are blind or

have severe disabilities.”

Id. at 731 (alteration in original). In Top Gun Services, LLC v. United States, a Judge of

this court wrote:

Once the Committee determines that a good or service is suitable for

procurement from a qualified nonprofit agency, the Committee places that

item on a published Procurement List and a federal agency wishing to

obtain that item must do so through a qualified nonprofit agency. 41 U.S.C.

§ 8503. There are specific requirements and conditions that nonprofit

agencies must satisfy to participate, and the Committee is required to

maintain and publish in the Federal Register the list of products and

services deemed suitable for procurement through AbilityOne. 41 U.S.C. §

8503(a). The Act does not define the suitability standard, but states that the

Committee “may prescribe regulations regarding specifications for products

and services on the procurement list . . . and other matters as necessary to

carry out this chapter.” 41 U.S.C. § 8503(c).

Top Gun Servs., LLC v. United States, 150 Fed. Cl.at 700–01 (alteration in original).19

The regulation at 41 C.F.R § 51-2.8(b), cited by defendant in support of its

arguments, provides that “[f]or commodities, including military resale commodities, the

Procurement List identifies the name and national stock number or item designation for

each commodity, and where appropriate, any limitation on the portion of the commodity

which must be procured under the JWOD Act.” 41 C.F.R. § 51-2.8(b). Defendant asserts

that this language in 41 C.F.R § 51-2.8(b) allows AbilityOne to limit the procurement of

the Women’s IHWCU Trousers by JWOD Act qualified nonprofit organizations to Army-

Natick, and, therefore, permits other federal entities, such as the DLA, to obtain

Procurement List items elsewhere, and in competitive procurements.

19 The court notes that in Top Gun Servs., LLC v. United States, although the Judge found

that protestor did not have standing to bring the protest, the Judge offered helpful

guidance on the operation of the JWOD Act in federal procurements: “‘[A] service that is

added to the procurement list may only be contracted through the [qualified nonprofit

agency] contractor selected by’ the AbilityOne Commission.” Top Gun Servs., LLC v.

United States, 150 Fed. Cl. at 705 (alterations in original) (quoting Akima Intra-Data, LLC

v. United States, 119 Fed. Cl. at 545).

50

Contrary to the defendant’s position, the regulation at 41 C.F.R. § 51-2.8(b) and

the words “any limitation on the portion of the commodity which must be procured under

the JWOD Act,” does not allow for limitation as to which agency or subset of an agency

is obligated to procure a Procurement List item pursuant to the JWOD Act from JWOD

Act qualified nonprofit organizations. The language in 41 C.F.R. § 51-2.8(b), “and where

appropriate, any limitation on the portion of the commodity” when read with the JWOD

Act statutory language in 41 U.S.C. § 8504(a) and JWOD Act implementing regulatory

language in 41 C.F.R. §§ 51-2.8, 51-6.7(b), 51-5.4; and 48 C.F.R. § 8.706, does not

change the fundamental mandatory guidance regarding agency acquisition of

Procurement List items. The JWOD Act implementing regulations direct that Only after

AbilityOne or the appropriate central nonprofit agency, find that the qualified nonprofit

organizations cannot produce the requested order by the procuring government agency

“within the time required,” 48 C.F.R. § 8.706(b), can AbilityOne or the appropriate central

nonprofit agency place a limit on the number of Procurement List items that must be

procured from qualified nonprofits. See 41 C.F.R. § 51-5.4(a)–(c). Alternatively, if the

qualified nonprofit producing the items concludes “that it cannot ship the commodity in

the quantities specified by the required shipping date, it shall notify the central nonprofit

agency and the contracting activity,” and the appropriate central nonprofit agency is

authorized to either (1) “request a revision of the shipping schedule” for the required items,

or (2) “the central nonprofit agency shall issue a purchase exception authorizing

procurement from commercial sources.” 41 C.F.R. § 51-6.7(b). Only after AbilityOne or

the appropriate central nonprofit agency grants a purchase exception to procure the

remainder of the items from a non-JWOD Act qualified source, can the item to be procured

from a commercial supplier or a different set aside source. See 41 C.F.R. § 51-5.4.

This reading of 41 C.F.R. § 51-2.8(b) is consistent with the policy of the JWOD Act

and its implementing regulations, which were designed specifically to “increase

employment and training opportunities for persons who are blind or have other severe

disabilities through the purchase of commodities and services from qualified nonprofit

agencies employing persons who are blind or have other severe disabilities.” See 41

U.S.C. § 8504(a); see also 41 C.F.R. § 51-1.1(a). The regulation at 41 C.F.R. § 51-2.8(b)

does not give AbilityOne, the appropriate central nonprofit agency, or a procuring

government agency blanket discretion when to alter how Procurement List items must be

acquired, add a scope or source limitations to an item on the Procurement List, or proceed

with issuing a competitive solicitation, without taking the necessary identified steps under

the JWOD Act and the JWOD Act implementing regulations to determine the capability of

JWOD qualified nonprofits to produce the items on the Procurement List.

Because both the DLA and Army-Natick are federal entities within the United

States Department of Defense, they are specifically subject to the requirements of the

JWOD Act and its implementing regulations when it comes to a federal entity procuring

Procurement List items. As noted above, the DLA is specifically listed in the applicable

regulation at 48 C.F.R. § 8.703 which provides, in relevant part, “GSA, DLA, and VA are

central supply agencies from which other Federal agencies are required to purchase

51

certain supply items on the Procurement List.” Id. In SEKRI, Inc. v. United States, the

Federal Circuit indicated:

If supplies are identified on the procurement list as available from the

Defense Logistics Agency (“DLA”) or the General Services Administration

(“GSA”) supply distribution facilities, then the supplies must be obtained

through those facilities, and in turn DLA and GSA “shall obtain the supplies

. . . from [SourceAmerica] or its designated AbilityOne participating nonprofit

agency.” See id. § 8.705–1 (emphasis added).

SEKRI v. United States, 34 F.4th at 1068 (emphasis, ellipses, and brackets in original) .

The language of the JWOD Act does not generally provide for exclusions for the DLA or

other federal government entities from its broad application. By issuing the competitive

solicitation and making an award pursuant to the competitive solicitation without following

the required procedures, as is discussed more fully below, the defendant failed to comply

with the JWOD statutory and implementing regulatory requirements. See 41 U.S.C.

§ 8504(a) (“An entity of the Federal Government intending to procure a product or service

on the procurement list referred to in section 8503 of this title shall procure the product or

service from a qualified nonprofit agency for the blind or a qualified nonprofit agency for

other severely disabled in accordance with regulations of the Committee and at the price

the Committee establishes if the product or service is available within the period required

by the entity.”); see also 48 C.F.R. § 8.706(b) (“Ordering offices may acquire supplies or

services on the Procurement List from commercial sources only if the acquisition is

specifically authorized in a purchase exception granted by the designated central

nonprofit agency.”).

To defend its position on the propriety of using a competitive procurement in the

current protest, defendant quotes selective parts of 41 C.F.R. § 51-2.5 and states that

“Section 51-2.5 provides that the Commission may ‘add a commodity or service in whole

or in part to the Procurement List[.]’” (alteration in original). The regulation at 41 C.F.R.

§ 51-2.5 provides in full:

The Committee considers the particular facts and circumstances in each

case in determining if a commodity or service is suitable for addition to the

Procurement List. When the Committee determines that a proposed

addition is likely to have a severe adverse impact on a current contractor, it

takes this fact into consideration in deciding not to add the commodity or

service to the Procurement List, or to add only a portion of the Government

requirement of the item. If the Committee decides to add a commodity or

service in whole or in part to the Procurement List, that decision is

announced in the Federal Register with a notice that includes information

on the effective date of the addition.

41 C.F.R. § 51-2.5. Although the process in 41 C.F.R. § 51-2.5 is available in the

appropriate circumstance, the problem with defendant’s reasoning and reliance on 41

C.F.R. § 51-2.5 is that this section of the Code of Federal Regulations addresses

additions to the Procurement List. In the present protest, according to both parties to the

52

litigation, the items to be produced already were on the Procurement List. Moreover, as

discussed above, the regulation at 41 C.F.R. § 51-6.7 indicates that when an item is

already on the Procurement List and

the nonprofit agency determines that it cannot ship the commodity in

quantities specified by the required shipping date, it shall notify the central

nonprofit agency and the contracting activity. The central nonprofit agency

shall request a revision of the shipping schedule which the contracting

activity should grant, if feasible, or the central nonprofit agency shall issue

a purchase exception authorizing procurement from commercial sources as

provided in § 51-5.4 of this chapter.

41 C.F.R. § 51-6.7(b). Defendant’s use of 41 C.F.R. § 51-2.5 to argue that AbilityOne may

opt to place scope limitations on items already on the Procurement List confuses adding

items to the Procurement List with removing items already on the Procurement List.

In addition, the JWOD Act implementing regulation at 41 C.F.R. § 51-6.8 provides:

(a) When a central nonprofit agency decides to request that the Committee

delete a commodity or service from the Procurement List, it shall notify the

Committee staff immediately. Before reaching a decision to request a

deletion of an item from the Procurement List, the central nonprofit agency

shall determ

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