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Telos Identity Management Solutions, LLC v. United States, 19-187 (2019)

Court: United States Court of Federal Claims Number: 19-187 Visitors: 5
Filed: Jul. 09, 2019
Latest Update: Mar. 03, 2020
Summary: In the United States Court of Federal Claims No. 19-187 Filed: June 28, 2019 Reissued: July 9, 20191 ) TELOS IDENTITY MANAGEMENT ) SOLUTIONS, LLC, ) ) Plaintiff, ) ) v. ) ) THE UNITED STATES, ) Post-Award Bid Protest; Judgment on the ) Administrative Record Defendant, ) ) and ) ) IDEMIA IDENTITY & SECURITY ) USA, LLC, ) ) Defendant-Intervenor. ) Katherine Baur Burrows and Nathanael D. Hartland, Nelson Mullins Riley & Scarborough LLP, Washington, DC, for plaintiff. Ashely Akers, U.S. Department o
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           In the United States Court of Federal Claims
                                          No. 19-187
                                     Filed: June 28, 2019
                                    Reissued: July 9, 20191

                                             )
    TELOS IDENTITY MANAGEMENT                )
    SOLUTIONS, LLC,                          )
                                             )
                    Plaintiff,               )
                                             )
    v.                                       )
                                             )
    THE UNITED STATES,                       )
                                                     Post-Award Bid Protest; Judgment on the
                                             )
                                                     Administrative Record
                   Defendant,                )
                                             )
         and                                 )
                                             )
    IDEMIA IDENTITY & SECURITY               )
    USA, LLC,                                )
                                             )
                   Defendant-Intervenor.     )


Katherine Baur Burrows and Nathanael D. Hartland, Nelson Mullins Riley & Scarborough LLP,
Washington, DC, for plaintiff.

Ashely Akers, U.S. Department of Justice, Civil Division, Washington, DC, for defendant.

Damien Clemens Specht, Morrison & Foerster, LLP, McLean, VA, for defendant-intervenor.

                                   OPINION AND ORDER

SMITH, Senior Judge

       This post-award bid protest comes before the Court on the parties’ Cross-Motions for
Judgment on the Administrative Record. Plaintiff, Telos Identity Management Solutions, LLC
(“Telos”), filed its Complaint on February 1, 2019, objecting to the United States Department of
Homeland Security, Transportation Services Administration’s (“TSA” or “Agency”) evaluation
of proposals under Solicitation No. 70T02018R9NOIA073 (“Solicitation”). See generally
Complaint (hereinafter “Compl.”). Plaintiff further objects to the subsequent award of an
Indefinite Delivery Indefinite Quantity (“IDIQ”) contract to defendant-intervenor, Idemia
1
        An unredacted version of this opinion was issued under seal on June 28, 2019. The
parties were given an opportunity to propose redactions, but no such proposals were made.
Identity & Security USA LLC (“Idemia”). 
Id. Plaintiff asks
this Court: (1) to grant its Motion
for Judgment on the Administrative Record and for Permanent Injunction; (2) enjoin TSA from
proceeding with the IDIQ Contract and Idemia from performing thereunder; (3) issue a new
solicitation or amend Solicitation to comply with the TSA Act; (4) issue a new source selection
decision or, alternatively, award a second IDIQ contract to Telos pursuant to the FAR; and (5)
deny defendant and defendant-intervenor’s Cross-Motions for Judgment on the Administrative
Record. See Plaintiff’s Reply in Support of its Motion for Judgment on the Administrative
Record and for a Permanent Injunction; Reply in Opposition to Defendants’ Cross Motions for
Judgment on the Administrative Record (hereinafter “Pl.’s Reply”) at 20. For the following
reasons, plaintiff’s Motion for Judgment on the Administrative Record is denied, and defendant
and defendant-intervenors’ Cross-Motions for Judgment on the Administrative Record are
granted.

    I.     Background

        On March 7, 2018, the Agency issued the Solicitation for the TSA Universal Enrollment
Services (“UES”). Administrative Record Tab (hereinafter “AR”) 36, AR 56 at 5027. The
Solicitation sought to award a single IDIQ contract2 that would provide “enrollment services for
programs, populations, initiatives or functions required, authorized, serviced by, or partnered
with TSA.” AR 38.1 at 2224. This Solicitation contemplated a follow-on contract to the 2012
“UES contract” (HSTS02-12-C-TTC702), which sought to provide a full suite of enrollment
services inclusive of all enrollment technology and operations infrastructure for its security threat
assessment programs. AR 27 at 584, AR 56 at 5025–26. The original UES contract expired in
September 2017, and TSA has been operating under a bridge contract with Idemia to maintain
those services during reprocurement. 
Id. The anticipated
IDIQ contract included a three-year base period, with a potential for a
ten-year period of performance, which consisted of a three-year base period, two (two-year)
options, and three (one-year) options. AR 36 at 822. The Solicitation also sought to issue a
contemporaneous Task Order (“Task Order 1”) with a potential for a ten-year period of
performance, that mirrored the performance breakdown of the anticipated IDIQ contract. AR 40
at 2481–82. Proposals were to be submitted in the following six volumes: (1) Cover Letter,
Tables of Contents, Executive Summary; (2) Direct Channeler Requirement; (3) Management
and Implementation Approach and Capabilities; (4) Technical Approach and Capabilities; (5)
Past Performance; and (6) Price and Labor Rates. AR 36 at 917–25. The Solicitation indicated
that the Agency would issue a “single-award contract to the responsive and responsible firm
whose proposal demonstrates the best value to the Government, price and non-price factors
considered.” AR 36 at 927.




2
        There exists a dispute between the parties as to whether the Solicitation indicated an
intent on the part of the TSA to make a single award, and whether a single award violates the
TSA Modernization Act of 2018 (the “TSA Act”). For the reasons set forth in the discussion
section of this opinion, the facts reflected herein assume the Agency’s intent was to make a
single award.
                                                 2
      The Agency received four proposals in response to the UES Solicitation. See generally
AR 41, AR 42, AR 43, AR 44. TSA evaluated those proposals from April to mid-September
2018. AR 45–49. Congress enacted the TSA Act, Pub. L. No. 115–254, §§ 1901 et seq., on
October 5, 2018. On January 7, 2019, the TSA issued the notice of contract award to Idemia.
AR 59 at 6870–71.

         On February 1, 2018, Telos filed its Complaint. See generally Complaint. At the request
of the parties, the Court remanded the case to the Agency. See Order, ECF No. 27. On March
15, 2019, after the parties failed to resolve the dispute after remand to the Agency, plaintiff filed
its Amended Complaint. See generally Am. Compl. In its Amended Complaint, plaintiff alleged
ten Counts. See generally 
id. However, during
the course of litigation, plaintiff abandoned all
but the following two counts: (1) the Agency’s award to Idemia violates the TSA Modernization
Act, and (2) the Agency’s decision to make a single award to Idemia was irrational and in
violation of law, statute, or regulation. See 
id. at 28,
36. On April 12, 2014, plaintiff filed its
Motion for Judgment on the Administrative Record. See generally Plaintiff’s Motion for
Judgment on the Administrative Record and for a Permanent Injunction (hereinafter “Pl.’s
MJAR”). On May 10, 2019, defendant filed its Cross-Motion for Judgment on the
Administrative Record. See generally Defendant’s Cross Motion for Judgment on the
Administrative Record and Response to Plaintiff’s Motion for Judgment on the Administrative
Record (hereinafter “Def.’s CMJAR”). Additionally, on May 10, 2019, defendant-intervenor
filed its Cross-Motion for Judgment on the Administrative Record. See generally Defendant-
Intervenor Idemia Identity & Security USA, LLC’s Response and Motion for Judgment on the
Administrative Record (hereinafter “Def.-Int.’s CMJAR”).

        On May 27, 2019, plaintiff filed its Response to defendant and defendant-intervenors’
Cross-Motions for Judgment on the Administrative Record and Reply in Support of its Motion
for Judgment on the Administrative Record. See Pl.’s Reply. On June 13, 2019, defendant filed
its Reply in Support of its Cross-Motion for Judgment Upon the Administrative Record. See
generally Defendant’s Reply in Support of its Cross Motion for Judgment on the Administrative
Record and Reply in Opposition to Plaintiff’s Motion for Judgment on the Administrative
Record (hereinafter “Def.’s Reply”). Also, on June 13, 2019, defendant-intervenor filed its
Reply in Support of its Motion for Judgment on the Administrative Record. See generally
Idemia Identity & Security USA, LLC’s Reply in Support of its Motion for Judgment on the
Administrative Record (hereinafter “Def.-Int.’s Reply”). The Court held oral argument on this
matter on June 21, 2019. The parties’ motions are fully briefed and ripe for review.

   II.     Standard of Review

       This Court’s jurisdictional grant is found primarily in the Tucker Act, which provides the
Court of Federal Claims with the power “to render any judgment upon any claim against the
United States founded either upon the Constitution, or any Act of Congress or any regulation of
an executive department, or upon any express or implied contract with the United States . . . in
cases not sounding in tort.” 28 U.S.C. § 1491(a)(1) (2012). Although the Tucker Act explicitly
waives the sovereign immunity of the United States against such claims, it “does not create any
substantive right enforceable against the United States for money damages.” United States v.
Testan, 
424 U.S. 392
, 398 (1976). Rather, to fall within the scope of the Tucker Act, “a plaintiff

                                                 3
must identify a separate source of substantive law that creates the right to money damages.”
Fisher v. United States, 
402 F.3d 1167
, 1172 (Fed. Cir. 2005) (en banc in relevant part).

        The Tucker Act also affords this Court with jurisdiction over bid protest actions. 28
U.S.C. § 1491(b). This Court evaluates bid protests under the Administrative Procedure Act’s
(“APA”) standard of review for agency actions. See Bannum, Inc. v. United States, 
404 F.3d 1346
, 1351 (Fed. Cir. 2005) (citing Impresa Construzioni Geom. Domenico Garufi v. United
States, 
238 F.3d 1324
, 1332 (Fed. Cir. 2001)). Notably, agency procurement actions may be set
aside only if they are “arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with the law.” 28 U.S.C. § 1491(b)(4). Moreover, “[t]he arbitrary and capricious
standard applicable [in bid protests] is highly deferential.” Advanced Data Concepts v. United
States, 
216 F.3d 1054
, 1058 (Fed. Cir. 2000). Agencies, and contracting officers in particular,
are “‘entitled to exercise discretion upon a broad range of issues confronting them’ in the
procurement process.” Savantage Fin. Servs. v. United States, 
595 F.3d 1282
, 1286 (Fed. Cir.
2010) (quoting 
Impresa, 238 F.3d at 1332
).

        Under Rule 52.1 of the Rules of the Court of Federal Claims (“RCFC”), a party may file
a motion for judgment upon the administrative record for the Court to assess whether an
administrative body, given all disputed and undisputed facts in the record, acted in compliance
with the legal standards governing the decision under review. See Supreme Foodservice GmbH
v. United States, 
109 Fed. Cl. 369
, 382 (2013) (citing Fort Carson Supp. Servs. v. United States,
71 Fed. Cl. 585
(2006)). On a motion for judgment upon the administrative record, the parties
are limited to the Administrative Record, and the Court makes findings of fact as if it were
conducting a trial on a paper record. RCFC 52.1; 
Bannum, 404 F.3d at 1354
. Looking to the
Administrative Record, the Court must determine whether a party has met its burden of proof
based on the evidence in the record. 
Bannum, 404 F.3d at 1355
. When a protestor claims that an
agency’s decision violates a statute, regulation, or procedure, the protestor must show that such
alleged violation was “clear and prejudicial.” 
Impresa, 238 F.3d at 1333
. The Court will
“interfere with the government procurement process ‘only in extremely limited circumstances.’”
EP Prods., Inc. v. United States, 
63 Fed. Cl. 220
, 223 (2005) (quoting CACI, Inc.-Fed. v. United
States, 
870 F.2d 644
, 648 (Fed. Cir. 1989)). “If the [C]ourt finds a reasonable basis for [an]
agency’s action, the [C]ourt 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.” Honeywell, Inc. v. United States, 
870 F.2d 644
, 648 (Fed. Cir. 1989).
The Court cannot substitute its judgment for that of an agency, even if reasonable minds could
reach differing conclusions. Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc., 
419 U.S. 281
,
285–86 (1974).

   III.    Discussion

           A. TSA Modernization Act

       Plaintiff alleges that the Agency’s award to Idemia violated the TSA Act and, as such,
was arbitrary, capricious, an abuse of discretion and/or in violation of law. Pl.’s Reply at 6. The
TSA Act provides, in relevant part, the following:



                                                 4
       (a) In General.— The Administrator of the Transportation Security
           Administration shall continue to administer the PreCheck Program in
           accordance with section 109(a)(3) of the Aviation and Transportation Security
           Act (49 U.S.C. 114 note).

       (b) Expansion.— Not later than 180 days after the date of enactment of the TSA
           Modernization Act, the Administrator shall enter into an agreement, using
           other transaction authority under section 114(m) of this title, with at least 2
           private sector entities to increase the methods and capabilities available for the
           public to enroll in the PreCheck Program . . . .

       (k) Assurance of Separate Program.— In carrying out this section, the
           Administrator shall ensure that the additional private sector application
           capabilities under subsections (b), (c), and (d) are undertaken in addition to
           any other related TSA program, initiative, or procurement, including the
           Universal Enrollment Services program.

       (l) Expenditure of Funds.— Any Federal funds expended by the Administrator to
           expand PreCheck Program enrollment shall be expended in a manner that
           includes the requirements of this section.

49 U.S.C. § 44919. Plaintiff argues that because the TSA Act covers the expansion of the TSA
PreCheck Program, and because the UES Contract anticipated a PreCheck enrollment rate of
approximately 1.8 million new enrollees per year, the TSA Act applies to the UES Contract
award. Pl.’s Reply at 6. Defendant argues that the TSA Act calls for an “expansion” of the TSA
PreCheck Program, while the UES contract only governs the existing PreCheck Program. Def.’s
Reply at 6, 12. Defendant-intervenor contends that the TSA Act directs PreCheck expansion “in
addition to any other related TSA program,” and that by naming the UES program, Congress
specifically excluded it from coverage under the TSA Act. Def.-Int.’s Reply at 9.

        It seems to this Court that at the crux of this dispute is an ambiguity in the TSA Act.
Where an ambiguity exists in a statute “the court does not simply impose its own construction on
the statute.” Chevron, U.S.A. v. Natural Resources Defense Council, Inc., 
467 U.S. 837
, 843
(1984). Rather, “if the statute is silent or ambiguous with respect to the specific issue, the
question for the court is whether the agency’s answer is based on a permissible construction of
the statute.” 
Id. In determining
whether an agency’s interpretation of the statute is permissible,
“considerable weight should be accorded to an executive department’s construction of a statutory
scheme it is entrusted to administer.” 
Id. at 844.
        It is undisputed that Congress adopted the TSA Act to govern TSA PreCheck expansion
programs. However, the language of the statute is ambiguous to the extent that “in addition to”
could be read to either specifically include or explicitly bar the UES program’s coverage under
the TSA Act. In light of that ambiguity, the Court must give proper deference to the Agency’s
understanding and application of the TSA Act. The Agency understood the phrase “in addition
to” as directing the solicitation of expansion programs separate from the existing UES program.
As such an understanding is neither “arbitrary, capricious, [n]or manifestly contrary to the

                                                 5
statute,” the Chevron principles of agency deference prohibit this Court from setting the
Agency’s interpretation aside.

           B. Single Award

        Plaintiff asserts that the Agency’s decision to make a single award was arbitrary,
capricious, an abuse of discretion, and/or in violation of law. Pl’s Reply at 14. Specifically,
plaintiff contends that, in addition to the TSA Act, Federal Acquisition Regulation
16.504(c)(1)(ii)(A)–(C) “states a preference for multiple awards for large IDIQ contracts.” Pl.’s
MJAR at 26. In Response, both the government and defendant-intervenor argue that plaintiff
waived that argument by failing to timely raise it in a pre-award protest. See Def’s CMJAR at
26–27; Def.-Int.’s CMJAR at 24.

        Blue & Gold Fleet, L.P. v. United States, 
492 F.3d 1308
(Fed. Cir. 2007), sets the
standard for whether an argument has been waived by failing to bring a pre-award protest.
Specifically, Blue & Gold states that “a party who has the opportunity to object to the terms of a
government solicitation containing a patent error and fails to do so prior to the close of the
bidding process waives its ability to raise the same objection subsequently in a bid protest
action.” 
Id. at 1313.
Plaintiff argues that Blue & Gold does not apply in the case at bar because,
although the TSA indicated its intention to make a single award, “the Agency never actually
found that multiple awards were not possible.” Pl’s Reply at 17. Telos further contends that,
until the single award was actually made, “Telos ID had no competitive injury sufficient to file a
pre[-]award protest.” 
Id. at 15
(citing CW Gov’t Travel, Inc. v. United States, 
110 Fed. Cl. 462
,
483 (2013)). The Court disagrees with plaintiff and finds Blue & Gold applicable to the present
issue.

         Throughout the pendency of the Solicitation, the TSA repeatedly expressed its intention
to make a single IDIQ award. On October 2, 2017, the Industry Day briefing slides for the UES
solicitation stated that the TSA intended to make a single award. AR 18 at 468. The Solicitation
itself also indicated that the TSA would only make a single award, stating that “[t]he
Government intends to award a single-award IDIQ contract.” AR 40 at 2586. When offerors
submitted questions to the Agency regarding its intent to make only one award, the Agency
specifically reiterated that “[t]he UES contract will remain a single IDIQ award.” AR 38.9 at
2443; see also, e.g., AR 38.9 at 2413. While the Court acknowledges that no bidder ever knows
with absolute certainty whether the government will conform to its assurances, the plaintiff had
more than sufficient notice of the Agency’s intent. The standard set by Blue & Gold required
plaintiff to raise the single award issue in a pre-award protest. See generally Blue & Gold, 
492 F.3d 1308
. By failing to timely raise this argument in a pre-award protest, the plaintiff waived it.

           C. Permanent Injunction and Motion to Strike

        As plaintiff failed to demonstrate success on the merits or show that the Agency’s actions
were arbitrary, capricious, or otherwise in violation of law, Telos is not entitled to injunctive
relief. As the plaintiff’s Motion for Judgment on the Administrative Record is denied, the Court
need not analyze the remaining factors for injunctive relief.



                                                 6
        On June 18, 2019, after the conclusion of the parties’ briefing on Cross-Motions for
Judgment on the Administrative Record, plaintiff filed a Motion to Strike both defendant and
defendant-intervenor’s respective Replies in support of their Cross Motions for Judgment on the
Administrative Record. See generally Plaintiff’s Motion to Strike Untimely Argument. Upon
careful review of the parties’ arguments, the Court believes that plaintiff’s objections merely
expand on its previous arguments, which the Court addresses above. As such, plaintiff’s Motion
to Strike is hereby DENIED.

   IV.     Conclusion

       For the reasons set forth above, plaintiff’s MOTION for Judgment on the Administrative
Record is DENIED. Defendant and defendant-intervenor’s CROSS-MOTIONS for Judgment
on the Administrative Record are GRANTED. The Clerk is directed to enter judgment in favor
of defendant and defendant-intervenor, consistent with this opinion.

      IT IS SO ORDERED.
                                                   s/   Loren A. Smith
                                                   Loren A. Smith
                                                   Senior Judge




                                               7

Source:  CourtListener

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