STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
SUNSHINE TOWING, INC, | ) | |||
) | ||||
Petitioner, | ) | |||
) | ||||
vs. | ) ) | Case | No. | 04-4481F |
ANCHOR TOWING, INC., and | ) | |||
DEPARTMENT OF TRANSPORTATION, | ) | |||
) | ||||
Respondents. | ) | |||
| ) | |||
ANCHOR TOWING, INC., | ) | |||
) | ||||
Petitioner, | ) ) | |||
vs. | ) ) | Case | No. | 06-4880F |
SUNSHINE TOWING, INC., | ) ) | |||
Respondent. | ) | |||
| ) |
FINAL ORDER
On December 8, 2004, Sunshine Towing, Inc. ("Sunshine") filed a Motion for Award of Attorney's Fees, amended on February 4, 2005 ("Sunshine's Fee Motion"). Sunshine's Fee Motion challenged claims asserted by Anchor Towing, Inc. ("Anchor"), in a bid protest, DOAH Case No. 04-1447BID, to a decision by the Florida Department of Transportation ("Department") to post its intent to award a contract to Sunshine under Department Request for Proposals No. RFP-DOT- 04/05-6063DS ("RFP 6063") (the "Anchor Protest"). On
December 1, 2006, Anchor filed a Motion for Attorney Fees ("Anchor's Fee Motion") challenging claims asserted by Sunshine in a second bid protest, DOAH Case No. 06-2451BID (the "Sunshine Protest"), involving a second decision by the Department to post an intent to award the same RFP 6063, to Anchor. The Fee Motions were consolidated into one proceeding by Order of the Administrative Law Judge, dated June 6, 2007. A final hearing was held on the consolidated cases on July 31, 2007, in Miami, Florida, before the Robert S. Cohen, Administrative Law Judge ("ALJ") with the Division of Administrative Hearings ("DOAH").
APPEARANCES
For Sunshine Towing, Inc.:
John C. Shawde, Esquire Kelly A. O'Keefe, Esquire Berger Singerman
200 South Biscayne Boulevard Suite 1000
Miami, Florida 33131
Daniel H. Thompson, Esquire
315 South Calhoun Street Suite 712
Tallahassee, Florida 32301 For Anchor Towing, Inc.:
Miguel A. De Grandy, Esquire Stephen Cody, Esquire
Miguel De Grandy, P.A.
800 Douglas Road, Suite 850 Coral Gables, Florida 33134
STATEMENT OF THE ISSUES
The issues are: 1) Whether Sunshine is entitled to an award of attorney's fees against Anchor pursuant to
Section 57.105, Florida Statutes (2007),1 with respect to certain of Anchor's claims in the first Anchor Protest; and 2) whether Anchor is entitled to an award of attorney's fees against Sunshine pursuant to Section 57.105, Florida Statutes, with respect to certain of Sunshine's claims in the second Sunshine Protest.
PRELIMINARY STATEMENT
This matter was initiated by the filing of Sunshine's Fee Motion on December 8, 2004, and the filing of Anchor's Fee Motion on December 1, 2006. The Fee Motions were consolidated into one proceeding by Order dated June 6, 2007. Both fee motions were filed by the respective parties in challenges to two decisions by the Department regarding posting of the intent to award a single request for proposal, RFP 6063, regarding Road Ranger services to motorists on certain Florida highways.
Sunshine filed its Fee Motion after the Department entered a Final Order on November 29, 2004, in DOAH Case No. 04-1447BID, rejecting Anchor's Protest challenging the Department's original posting of the intent to award the RFP to Sunshine. Anchor filed its Fee Motion before the Department entered its Final Order on December 22, 2006, in DOAH Case No. 06-2451BID,
rejecting Sunshine's Protest challenging the Department's subsequent posting of the intent to award the same RFP to Anchor.
On April 12, 2005, the undersigned ALJ commenced a hearing on Sunshine's Fee Motion (the "Original Fee Hearing"). The hearing was recessed that same day, prior to Sunshine's completing its case in chief, because Anchor's counsel refused to comply with an order requiring counsel to testify at the hearing.
On April 15, 2005, three days after the recess, the Department issued a Final Order on Remand, in which it ordered the Department's District Six Office to convene a new evaluation committee to score the original proposals. The Order further provided "that the prior Final Order dated November 29, 2004, and the contract awarded thereunder shall not be affected unless the new evaluation and subsequent postings of an intent to award concludes that a proposer other than [Sunshine] should be awarded the contract." As a result of the new evaluation, the Department posted its intent to award the RFP to Anchor, and the Sunshine Protest commenced.
Each of the parties filed unilateral pre-hearing statements. On August 27, 2007, the undersigned ALJ entered an "Order Granting, in Part, Sunshine Towing's Motion in Limine Regarding Evidence and Argument at Consolidated Hearing,
Granting, in Part, Sunshine Towing's Motion for Protective Order, and Granting Sunshine Towing's Motion to Strike" ("the Hearing Order"). The Hearing Order provided that Anchor could only pursue fees pursuant to Section 57.105, Florida Statutes, for the claims asserted in Sunshine's original Petition. Anchor could not pursue claims raised in Sunshine's amendments to its Petition because Anchor did not notify Sunshine of its intent to pursue those claims, as required by Section 57.105, Florida Statutes.
At the final hearing, the parties agreed to move to admit into evidence in this proceeding all of the pleadings filed, discovery produced, testimony presented, and documents introduced into evidence at both the Anchor and Sunshine Protests, as well as the pleadings, testimony, and documents introduced into evidence at the Original Fee Hearing. All were admitted. Both parties then presented argument, but neither party presented any further testimony or moved any further documents into evidence.
A transcript of the hearing was filed on August 14, 2007.
Based on the record, including the evidence and testimony presented at final hearing, DOAH enters the following findings of fact and conclusions of law.
FINDINGS OF FACT
Sunshine's Fee Motion
On December 18, 2003, the Department's District Six advertised RFP 6063 inviting towing companies to submit bids to provide Road Ranger towing services to motorists on State
Roads 112, 836, 874, 878, and 924. Following an evaluation and scoring of all bid submittals, on March 18, 2004, the Department issued its Notice of Intent to award the contract for RFP 6063 to Sunshine.
On March 29, 2004, Anchor filed its formal written protest challenging the proposed award of the contract to Sunshine.
On July 12, 2004, prior to the start of the final hearing, counsel for Sunshine sent a letter to counsel for Anchor (the "Sunshine Letter"). In that letter, Sunshine put Anchor and its counsel on notice that, pursuant to
Section 57.105, Florida Statutes, Sunshine would seek its legal fees incurred in defending against certain claims made in Anchor's Protest unless those claims were withdrawn. The Sunshine Letter specifically stated:
[D]emand is hereby made that your client withdraw that portion of its bid protest that claims: (1) that Sunshine Towing's bid submittal should be declared non-responsive and that Anchor Towing's bid submittal should be declared responsive; (2) that even if Sunshine Towing's bid submittal
is deemed responsive, Anchor Towing should be deemed the highest ranked bidder because its point total would be higher than Sunshine Towing's bid if the DOT had correctly awarded zero points to Sunshine Towing for a certain category as a result of Sunshine Towing's alleged failure to include litigation history with its bids submittal.
We have already provided you with our Motion for Judgment on the Pleadings which sets forth the lack of any basis for the "non-responsive" arguments relating to Sunshine Towing's alleged failure to acknowledge receipt of the addendum, and alleged failure to follow the outline. Our position is that given the plain language of the RFP and the case law establishing what constitutes a material deviation from the terms of an RFP, that these arguments are without factual or legal basis as set forth in section 57.105(1).
In addition, your client's other untenable position is that Sunshine Towing's bid submittal should be deemed non- responsive because its alleged failure to include a litigation history. It is axiomatic under applicable law that in order for Anchor Towing to prevail in this argument, its bid submittal must not suffer from the same alleged defect. Assuming without conceding that providing the litigation history was a material element of the RFP, the undisputed facts are that Anchor Towing failed to submit a fully responsive litigation history along with its bid submittal. It failed to disclose all cases in which it was a named defendant, and that should end the matter. . . .
On October 29, 2004, following the final hearing, DOAH entered a Recommended Order upholding the Department's intended award to Sunshine, rejecting Anchor's claims, and dismissing Anchor's protest. On November 29, 2004, the Department entered
a Final Order adopting the Recommended Order in its entirety. No appeal was taken.
Sunshine filed its Fee Motion on December 8, 2004, seeking an award of attorney's fees pursuant to Subsection 120.595(6) and Section 57.105, Florida Statutes. Sunshine later withdrew its claims for fees pursuant to Subsection 120.595(6), Florida Statutes.
Sunshine amended its Fee Motion on February 4, 2005, to include a specific fee and cost amount of $77,252.00, which sum represented 50 percent of the fees and costs it incurred in the defense of the Anchor Protest.
On April 12, 2005, the ALJ commenced a hearing on Sunshine's Fee Motion, but recessed the hearing after counsel for Anchor refused to testify.
On April 15, 2005, before the ALJ could continue the hearing and rule on Sunshine's Fee Motion, the Department entered a Final Order or Motion to Remand ("Remand Order") in which it remanded the case and ordered a new evaluation committee empanelled based on the admitted misconduct of a technical review committee member.
On April 28, 2005, Sunshine moved for reconsideration or clarification of the Remand Order. On June 10, 2005, the Department issued a subsequent Order or Motion for Reconsideration/Clarification ("Clarification Order"). The
Clarification Order specifically stated that "The DEPARTMENT recognizes that the administrative law judge made certain findings of fact concerning proposals submitted by SUNSHINE and ANCHOR. Because those findings have gone unchallenged, they are final and binding on the parties." The Clarification Order also required that the members of the new evaluation committee be made aware of the following selected findings of fact and accept them as true:
46. Sunshine's response to the RFP did not follow the organizational format or numbering of the Technical Proposal Format set forth in the RFP.
* * *
48. Sunshine's response to the RFP did not disclose the litigation history of the firm or its owners.
* * *
Anchor's Response to the RFP did not follow the organizational format of the Technical Proposal Format set forth in the RFP in that it was not sequentially numbered and was not indexed as set forth in Section
20.4 of the "Special Conditions" to the RFP.
Anchor's response to the RFP did not contain a copy of the firm's Certificate of Occupancy for business premises from which to conduct the services
solicited by the RFP as set forth in Section 20.2.1.(iii)(c) of the RFP.
* * *
55. Petitioner failed to disclose two litigation matters involving Monica Savits,
President of Anchor, which were dismissed prior to a judgment or verdict having been rendered.
* * *
Petitioner failed to disclose a small claims court matter filed against Anchor Towing on May 3, 2002.
Petitioner did not disclose the felony conviction of Christopher Savits dated August 5, 2003, relating to towing or storage activities involving one of Anchor's tow trucks and Mr. Savits.
No appeal was taken from the Clarification Order, which was final agency action pursuant to Section 120.68, Florida Statutes.
As framed in the Sunshine July 12, 2004, letter and Sunshine Fee Motion, the specific claims raised by Anchor for which Sunshine now seeks an award of fees and costs pursuant to Section 57.105, Florida Statutes, are:
Sunshine should be declared non- responsive because it "failed to follow the required Technical Proposal format" in the RFP by not following the "required organizational format or numbering";
Sunshine should be declared non- responsive because "it failed to provide required information regarding litigation history" whereas Anchor's bid submittal "contained all the requisite information";
Sunshine should be declared non- responsive because "it failed to acknowledge receipt of Addendum Two."
Sunshine prevailed in the Anchor Protest and prevailed with respect to each of the Anchor claims. Sunshine has
asserted as a basis for fees pursuant to Section 57.105, Florida Statutes.
The First Recommended Order
With respect to the issue of failure to follow organizational format and failure to disclose litigation history, the ALJ concluded in the first Recommended Order based on Intercontinental Properties, Inc. v. Department of Health and Rehabilitative Services, 606 So. 2d 380 (Fla. 3d DCA 1992), that Anchor did not have standing to raise these claims. In particular, the first Recommended Order stated:
the evidence at hearing clearly supported the fact that neither [Anchor] nor [Sunshine] submitted the proposal in the required format. Further, while [Anchor] submitted a list of litigation matters involving its officers and employees, its list was incomplete . . . [Anchor] was awarded 11 points for its incomplete proposal while [Sunshine] was awarded zero points for its failure to include a list. (first Recommended Order, para. 86, p. 22).
The evidence at hearing as well as the pertinent case law lead to the conclusion that [Anchor] lacks standing to raise the issues of [Sunshine's] failure to follow the organizational proposal format, and failure to disclose its litigation history since [Anchor's] proposal suffered from the same defects. (first Recommended Order, para.
87, p. 22).
Both [Sunshine] and [Anchor] failed to follow the Department's organizational format contained in the RFP, and both failed to disclose (or, in the case of [Anchor] to fully disclose) litigation history,
according to the testimony of principals of each company. Accordingly, [Anchor's] response suffers from the same defects as [Sunshine's] response. Therefore, [Anchor] does not have standing to raise this argument. (first Recommended Order, para.
88, p. 21-22).
With respect to the claim that Sunshine had failed to submit a signed Addendum 2, the ALJ concluded that there was no evidence offered to support it and rejected it. The first Recommended Order stated:
In fact, no evidence was produced to demonstrate that an "Addendum Two" even existed. The only evidence produced at the hearing concerning addenda to the RFP concerned 'Addendum One' which both [Anchor] and [Sunshine] were found to have included with their proposals. Since no evidence appears in the record to support [Anchor's] contention that [Sunshine's] proposal is
non-responsive for failure to file "Addendum Two", this argument is rejected." (first Recommended Order, para. 91, p. 24).
Sunshine's RFP Format
Anchor's proposal, like Sunshine's proposal, failed to follow the outline and format set forth in the RFP. Section
20.2 of the Special Conditions to the RFP states:
The Proposer must submit one (1) original and eleven (11) copies of the technical proposal which are to be divided into the sections described below. Since the Department will expect all technical proposals to be in this format, failure to follow this outline may result in the rejection of the proposal. (Exhibit 1,
p. 10 of 22) (emphasis added).
Section 20.4 of the Special Conditions to the RFP states that "[t]he proposal should be indexed and sequentially numbered."
Prior to submitting Anchor's Protest, Anchor and its counsel had in their possession Anchor's proposal and Sunshine's proposal, which both failed to follow the technical format.
Accordingly, Anchor and its counsel knew or should have known that its proposal suffered from the same deficiency that it asserted Sunshine's proposal suffered from.
Sunshine's Litigation History
Section 20.2.1.(iii)(g) of the RFP requires that "the proposer shall indicate if their company or any of their principle [sic] officers, employees, or owners have been involved with any lawsuits or judgments against the individual or the firm."
In Sunshine's Memorandum of Law in Opposition to Petitioner's Formal Written Bid Protest, filed on July 19, 2004, Sunshine specifically identified lawsuits that Anchor had not disclosed in its proposal in which Anchor was a named defendant and in which Monica Savits (the president of Anchor) was a named defendant.
The litigation history which Anchor failed to disclose in its proposal was all litigation that had occurred or been initiated prior to the filing of Anchor's Protest. Anchor thus should have known of the litigation history, or at a minimum
confirmed that it had disclosed its complete litigation history before challenging Sunshine's failure to include its litigation history.
At the beginning of the hearing, prior to making its opening statements, Anchor's counsel admitted to the undersigned that Anchor had failed to completely disclose its litigation history.
Despite this admission, Anchor insisted that it would abandon this claim only if Sunshine agreed to withdraw its defensive claim that Anchor should be declared non-responsive for failing to disclose Christopher Savits' felony conviction involving towing and storage as required by the second sentence of Section 20.2.1.(iii)(g). When Sunshine declined to do so, Anchor's counsel acknowledged the application of Intercontinental Properties, but indicated that it would argue the failure to disclose the lawsuits was de minimus.
Anchor offered no support for its assertion of a "de minimus" exception to Intercontinental Properties or otherwise argued for a good faith modification to Intercontinental Properties.
Anchor's Motion in Limine, filed after the ALJ'S Order limiting issues Anchor could pursue in its Section 57.105 Motion to those it properly noticed, asserted that Sunshine could only look to Mr. Savits' conviction to support it claim for fees
based on Anchor's failure to disclose its litigation history and the decision in Intercontinental Properties, because Anchor alleged that was the only conviction listed in the July 12, 2004, letter.
Sunshine's July 12, 2004, letter does not limit its reference to the undisclosed litigation as Anchor suggests, but asserts that Anchor failed to submit a fully responsive litigation history and failed to disclose lawsuits in which Anchor was a named defendant. Anchor's Motion in Limine, therefore, has no impact on Sunshine's Fee Motion.
Sunshine's Acknowledgement of Non-Existent Addendum 2
Prior to submitting Anchor's Bid Protest, Anchor and its counsel had not identified or confirmed the existence of Addendum 2 on which its claim was based.
With respect to the addendum, Anchor asserted in its Unilateral Pre-Hearing Stipulation, that in connection with, a separate RFP issued by the Department for Road Ranger Services, RFP 6062 (not RFP 6063), the DOT issued a document called "Question and Answers" which provided a written answer to a written question submitted by a proposer for RFP 6062. In its proposed trial exhibits, Anchor did not list either an "Addendum Two" or a "Question and Answers" document issued in connection with RFP 6063, but instead only listed a document identified as "Question and Answers" in connection with RFP 6062. Nor did
Anchor identify the specific addendum upon which, it was relying in its opening.
RFP 6063 did not have an "Addendum 2" associated with
it.
Thus, prior to the commencement of the final hearing, Anchor and its counsel were fully aware of the defects in the factual and legal grounds for all three claims in their protest, which Sunshine raised in its Fee Motion.
Moreover, at the time Anchor and its counsel filed Anchor's Protest they should have known of the defects in the factual and legal grounds for these three claims.
Anchor's Fee Motion
On June 1, 2006, following the new evaluation ordered by the Department pursuant to the Remand Order, the Department issued its Notice of Intent to Award the contract for RFP 6063 to Anchor.
On June 15, 2006, Sunshine filed its formal written protest of the award to Anchor, and requested that the contract be awarded to Sunshine.
Anchor served its Fee Motion on Sunshine on July 18,
2006.
After Anchor served its Fee Motion, the ALJ granted
Sunshine leave to amend its original petition to assert several additional protest grounds.
Anchor did not amend its Fee Motion or otherwise notify Sunshine that it would also seek fees on the additional grounds asserted in Sunshine's Protest.
On November 27, 2006, following a final hearing, the ALJ entered an Amended Recommended Order upholding the Department's award to Anchor, rejecting Sunshine's claims, and dismissing Sunshine's Protest.
On December 22, 2006, the Department entered a Final Order adopting the Amended Recommended Order in its entirety. Sunshine appealed the Final Order to the Third District Court of Appeal.
The Third District Court of Appeal subsequently issued a Per Curium Affirmed decision affirming the Final Order on August 31, 2007.
Anchor filed its Fee Motion on December 1, 2006, seeking an award of attorney's fees pursuant to Section 57.105 with regard to the claims asserted in Sunshine's original petition.
On June 6, 2007, the ALJ entered an order consolidating the Sunshine Fee Motion and the Anchor Fee Motion. A hearing on both motions was set for July 31, 2007.
On July 27, 2007, the ALJ entered its "Order Granting, in Part, Sunshine's Motion in Limine Regarding Evidence and Argument at Consolidated Hearing, Granting, in Part, Sunshine's
Motion for Protective Order, and Granting Sunshine's Motion to Strike." The Order limited Anchor's Section 57.105 Motion to those claims that it actually asserted in its Fee Motion served on July 18, 2006, and filed on December 1, 2006. The ALJ precluded Anchor from challenging claims Sunshine raised via amendment to its original petition as Anchor had not notified Sunshine that it intended to pursue them. Specifically, the ALJ identified the issues remaining for litigation in the final hearing on Anchor's Fee motion as follows:
Whether Sunshine lacked standing to bring its protest due to its failure to have been providing the type of services required for a minimum of five years in good corporate standing;
Whether Sunshine lacks standing to protest on the basis that Anchor failed to disclose the felony conviction of Christopher Savits;
Whether Sunshine was aware of active ongoing litigation against it, yet failed to disclose any litigation history;
Whether Sunshine established that Christopher Savits was not its officer, director, principal, or employee, yet Sunshine protested the intended award of the contract to Anchor on this basis;
Whether the bid protest is not supported by the material facts necessary to establish the claim that Christopher Savits' conviction should have been disclosed in response to the RFP;
Whether the scoring of four of the five evaluators was arbitrary and capricious and not supported by the application of existing law to the material facts of how the four evaluators scored Sunshine's proposal;
Whether Sunshine had material facts at its disposal to determine that Matthew O'Brien, one of the evaluators, was biased against its proposal or it as a company;
Whether Anchor was required to attach a certificate of occupancy to its response to the RFP for the premises from which the contract will be serviced and whether Sunshine had material facts to support this claim; and
Whether Anchor was required to control the premises at 7444 Northwest 8th Street, Miami, Florida, and whether Sunshine's claim in this regard was supported by material facts.
Whether Sunshine lacked standing to bring its protest due to its failure to have been providing the type of services required for a minimum of five years in good corporate standing.
On July 30, 2007, Anchor originally asserted in the Anchor protest that Sunshine was non-responsive because it failed to comply with "the five-year corporate standing requirement" in Section 20.2.1.(iii)(b) of the RFP which provides that:
The Proposer shall indicate that the firm not the individual has been providing the type of services required for a minimum of five (5) years in good corporate standing.
Anchor raised this argument for the first time in its opening statement in the Anchor Protest and Sunshine objected to the ALJ's consideration because it had never been raised before by Anchor.
The ALJ reserved ruling on Sunshine's objection, and a significant amount of time was devoted to that claim during the First Protest.
In its written closing argument and Proposed Recommended Order in the Anchor Protest, Anchor stated that "the key" to understanding the meaning of the five-year requirement "is to determine what is commonly understood under the law by the phrase 'good corporate standing'." Anchor conceded that "a search on Westlaw revealed that no Florida court has used the phrase 'good corporate standing' in an appellate opinion."
Ultimately, the ALJ concluded in the Anchor Protest that Anchor had not timely raised the claim that Sunshine failed to comply with the "five-year corporate standing requirement" and rejected it. The Recommended Order stated:
[t]he plain fact remains that [Anchor] failed to put the Department and [Sunshine] on notice that this would be an issue at hearing. Counsel for [Sunshine] objected to [Anchor's] attempt to raise the issue of the five-year requirement at hearing. Counsel's objection was well taken. The issue of whether [Sunshine] meets the five-year requirement is not properly before this forum and will not be considered for determination here (first Recommended Order, para. 85, p. 21).
Sunshine has now withdrawn its claims for fees, which was based on Anchor's late assertion of the issue which was made
pursuant to Subsection 120.595(b), Florida Statutes, rather than Section 57.105, Florida Statutes.
While the claim is no longer an issue with respect to Sunshine's Fee Motion, Anchor has asserted it is entitled to all fees it incurred in the defense of Sunshine's Protest pursuant to Section 57.105, Florida Statutes, where Sunshine did not meet the mandatory "five-year corporate standing requirement."
Although the ALJ found that Sunshine did not have standing based upon the "five-year corporate standing request requirement," there are clearly material facts supporting Sunshine's defense.
The Department never declared Sunshine to be non- responsive to "the five-year requirement."
The Department not only initially recommended that the contract for RFP 6063 be awarded to Sunshine, but after the conclusion of the Anchor Protest, the Department and Sunshine executed a contract for RFP 6063, and the Department issued a Notice of Commencement.
At the time Sunshine filed its protest, Sunshine was the incumbent providing service to the Department under RFP
6063.
The Department issued RFP 6063 and RFP 6062 at the
same time. Sunshine bid on both RFP's, whereas Anchor only bid on RFP 6063. Both RFP's contained the identical "five-year
requirement." Sunshine was awarded the contract for RFP 6062, and executed a contract with the Department for RFP 6062.
The Department conducted a single pre-bid conference for both RFP 6062 and 6063. During that conference, Nancy Lyons answered questions and made statements to the attendees which indicated that Sunshine would comply with the five-year requirement. Both Sunshine and Anchor attended the meeting.
In early 2003, the Department issued RFP 6053 which contained the identical five-year requirement. Sunshine submitted a bid, and attended the pre-bid conference where Sunshine representatives asked questions. Ms. Lyons of the Department responded to those questions in a manner indicating that Sunshine would be considered responsive to the five-year requirement. The Department issued a written clarification to the "five-year requirement" which indicated that Sunshine's previous unincorporated status would not preclude Sunshine from being considered responsive to the RFP. At the time of that
pre-bid conference, Sunshine had been incorporated for less than three years, but was still considered by the Department to be a responsive bidder, because of its prior towing business history.
In the Anchor Protest, Ms. Lyons was the Department's designated representative for purposes of the final hearing. She testified that Sunshine complied with the five-year requirement.
In Finding of Fact No. 61 of the Amended Recommended Order, the ALJ found and confirmed that Sunshine knew at the time it filed the Second Protest:
Ms. Lyons would interpret the five years of corporate existence requirement to allow a firm that was in business at least five years, even if it was not incorporated the entire five years, to qualify as a proposer so long as the firm was in business under the same name prior to being incorporated.
The Department submitted a proposed recommended order to the ALJ at the conclusion of the Anchor Protest, wherein it recommended that the ALJ enter a recommended order that the contract for RFP 6063 be awarded to Sunshine as the highest ranked responsive bidder.
In response to discovery requests in Sunshine's Protest, the Department admitted that Sunshine's bid submittal complied with "the five-year requirement" in Section 20.2.1.(iii)(b) of the RFP and was a responsive proposal within the meaning of Section 11.2 of the RFP.
The testimony during the final hearing in the Second Protest was also consistent with the argument that Sunshine complied with "the five-year requirement." Ms. Lyons (the Department's District Six Procurement Manager) testified that Sunshine's proposal satisfied the five-year requirement, consistent with her testimony at the final hearing in the First Protest. Ms. Lyons testified that she drafted the RFP,
including the five-year requirement, and that as Procurement Manager, she had the ability to incorporate the Department's intent into the RFP. Ms. Lyons testified that the five-year requirement used in several of the Road Ranger RFP's (including RFP 6063) meant that: 1) a bidder had to be a company (not just a "corporation") engaged in the towing business for more than five years prior to bid submittal; 2) during that five-year period, the business of the towing company was not being performed by a single individual acting alone, but was using a significant number of individuals to perform those services;
3) the company was not required to be a corporation for the entire five-year period in order to be responsive; 4) during that five-year period, the company had to be in good business standing regardless of whether it was a corporation for that entire five-year period; and 5) as long as at least one of the owners of the company prior to incorporation continued as an owner upon incorporation and that owner had substantial towing experience, the period during which the company was unincorporated would be included in the calculation of the five years.
Whether Sunshine lacks standing to protest on the basis that Anchor failed to disclose the felony conviction of
Mr. Savits; and whether Sunshine was aware of active ongoing litigation against it, yet failed to disclose any litigation history.
Sunshine filed a Motion for Clarification of the ALJ's Order requesting clarification that the issues as identified by the ALJ coincided with the issues raised in Anchor's Fee Motion. With respect to Issues 2 and 3, Sunshine sought to clarify that:
1) Issue 3 in the ALJ's Order had already been decided in Anchor's Protest when the ALJ concluded that "Sunshine's response to the RFP did not disclose the litigation history of the firm or its owners"; and 2) that the ALJ's prior findings of fact and conclusions of law in the first Recommended Order did not decide Issue 2 because Section 20.2.1.(iii)(g) of the Special Conditions to the RFP contains, in addition to the requirement that the proposer include its litigation history, a separate requirement that the proposer include a list of judgments relating to towing and storage.
At the final hearing on the Fee Motions, the ALJ clarified that it intended that the issues it listed coincided with Anchor's Motion. Thus, the ALJ's issue has already been decided.
Section 20.2.1.(iii)(g) of the Special Conditions to the RFP states:
The Proposer shall indicate if their company or any of their principal officers, employees or owners have been involved with any lawsuits or judgments against the individual or the firm. They shall include a list of all outstanding judgments (if any) relating to towing or storage activities.
In Anchor's Protest, Anchor recognized that Section 20.2.1.(iii)(g) presented two separate requirements.
At the initial April 12, 2005, hearing on the Sunshine Fee Motion in the Anchor Protest, Anchor's counsel argued that Section 20.2.1.(iii)(g) of the RFP contained two separate and distinct requirements.
In Anchor's Protest, the ALJ made no explicit finding as to whether Section 20.2.1.(iii)(g) contained two separate requirements, because it was not necessary to do so. Both Anchor and Sunshine failed to disclose their litigation
history as described in the first requirement of Section 20.2.1.(iii)(g), so Intercontinental Properties precluded Anchor from protesting the award to Sunshine on that basis.
The Department also concluded that Section 20.2.1.(iii)(g) contained two separate provisions.
Prior to the final hearing on the Sunshine Protest, in response to Sunshine's Requests for Admission, the Department admitted that "[i]n Anchor Towing's bid submittal in response to the RFP, Anchor Towing was required by the RFP to disclose the felony judgment entered against Christopher Savits."
Testimony from Ms. Lyons also supported Sunshine's claim that Section 20.2.1.(iii)(g) of the RFP contained two separate and distinct requirements. (Sunshine Transcript, Vol. III, p. 877).
The Amended Recommended Order also recognized the distinction between the two requirements of this Section 20.2.1.(iii)(g), in finding that this section of the RFP:
which appeared in prior Road Ranger contracts, was amended to add the second sentence, after the Department entered into its contract for RFP-DOT-6053. This second sentence was added for the first time to this RFP to ensure that the Department did not contract with a company that was conducting illegal activity related to towing and storage, because the Department hoped to avoid negative feedback for its Road Ranger program. (Exhibit 29, para. 21, p. 11).
However, Sunshine's Protest challenged Anchor's alleged failure to comply with the Second requirement in Section 20.2.1.(iii)(g). Sunshine alleged Anchor did not list in its proposal the conviction of Mr. Savits related to towing and storage.
Sunshine did not have any judgments related to towing and storage and, consequently, Sunshine maintained it was not barred from raising this claim by Intercontinental Properties.
The ALJ ultimately concluded in the Amended Recommended Order that Anchor was not required to disclose
Mr. Savits conviction not because of Intercontinental Properties, but because the ALJ concluded that Mr. Savits was not an owner, officer, or employee at the time Anchor submitted its proposal.
Whether Sunshine established that Mr. Savits was not its officer, director, principal, or employee, yet Sunshine protested the intended award of the contract to Anchor on this basis; and whether the bid protest is not supported by the material facts necessary to establish the claim that Mr. Savits' conviction should have been disclosed in response to the RFP.
Issues 4 and 5, address the factual basis for Sunshine's argument that Mr. Savits' conviction should have been disclosed because he was an officer, owner, or employee of Anchor. In its Motion for Clarification, Sunshine sought to confirm that the ALJ's statement of these issues were consistent with Sunshine's claims and Anchor's Fee Motion.
The ALJ confirmed at the July 31, 2007, final hearing that only those issues included in Anchor's Motion would be considered.
Anchor's Fee Motion asserts that "Sunshine may not protest the prospective award of the contract to Anchor on the basis that Christopher Savits was a 'principle [sic] officer, employee or owner of Anchor as those terms are used in section 20.2.1.(iii)(g) of the Special Conditions" (Anchor Fee Motion, para. 24, p. 6-7) because "[t]he findings of fact [in the Anchor Protest] specifically found that Christopher Savits was not an
officer, director, or employee of Anchor" (Anchor Fee Motion, para. 23, p. 6) and those findings of fact are "binding on the parties."
Thus, Anchor's Fee Motion only asserts that the first Recommended Order conclusively established that, as a matter of law, Mr. Savits was not an officer, director or employee of Anchor. It does not assert that Sunshine had no factual or legal basis to support its contention that Mr. Savits was an owner or officer, or held out as one.
The first Recommended Order did not make any specific findings that Mr. Savits was not an officer or owner of Anchor.
Sunshine filed a motion to compel Anchor to produce certain documents in order to prove that Mr. Savits was an employee or owner of Anchor. Anchor objected to that discovery, arguing that Finding of Fact No. 63 in the first Recommended Order (Exhibit 3, para. 63, p. 15) conclusively determined that Mr. Savits was not an employee of Anchor at the time of bid submittal and, therefore, the discovery was not relevant. At the August 11, 2006, hearing on Anchor's motion, the ALJ granted Sunshine's motion to compel, and rejected Anchor's argument.
The Amended Recommended Order did not contain any findings of fact or conclusions of law stating that the ALJ had, in the prior Recommended Order, conclusively determined that
Mr. Savits was not an employee or owner at the time of bid submittal.
Sunshine presented numerous facts during the course of both protests that suggested Mr. Savits at least appeared to be an owner and employee of Anchor.
Anchor included letters of reference in its proposal that referred to Mr. Savits as an owner or co-owner of Anchor.
Mr. Savits attended meetings with the Department on behalf of Anchor on numerous occasions, and even received payment from Anchor.
The Department assigned Mr. Savits a Nextel ID number which was given to owners and drivers of companies with whom the Department contracted.
Accordingly, Sunshine also maintained that even if Mr. Savits was not officially an owner or employee of Anchor, it was bound by his representations to the Department that he was an owner and employee where the Department relied on those representations.
Whether the scoring of four of the five evaluators was arbitrary and capricious and not supported by the application of existing law to the material facts of how the four evaluators scored Sunshine's proposal.
Sunshine challenged the scoring of the individual evaluators as arbitrary and capricious on numerous grounds, including specific deficiencies in four evaluators scoring and
the overall scoring methodology in which all five evaluators divided the acceptable subcategories listed in the RFP for scoring the proposals into unacceptable subcategories.
The ALJ concluded in the Amended Recommended Order with respect to Sunshine's scoring claims that:
The final argument raised by Petitioner is that the scoring methodology employed by four of the five members of the Selection Committee was arbitrary and capricious.
Petitioner raised this argument on the basis of its position that the evaluators divided the acceptable subcategories listed in the RFP for scoring the proposals into unacceptable sub-categories, and left these to the evaluators to determine the weight to be given to each sub-category. The evidence at hearing was undisputed that the evaluators utilized the numeric values of the scoring subcategories as the upper limit for the aggregate of the sub-categories related to each sub-category. None of the evaluators crossed over from one subcategory to another when scoring the proposals. The use of sub-categories was not in violation of the terms of the RFP. No testimony was given at hearing to demonstrate that any Selection Committee member awarded more points for a category or subcategory than was permitted by the terms and conditions of the RFP.
Petitioner challenged the scoring system employed by the Selection Committee as arbitrary and capricious. If, to borrow from the definitions contained in Section 120.52(8) of the Florida Statutes, "arbitrary" may be defined as not supported by logic or the necessary facts, and "capricious" may be defined as action taken without thought or reason, or on a whim, when Petitioner wholly failed to prove that the scoring methodology was arbitrary and capricious. If the scoring methodology were
arbitrary and capricious, then it was so with respect to all Proposers, not just Petitioner. Moreover, Petitioner failed to prove at hearing that it would have been the higher-scored Proposer if a different scoring methodology were used. Actually, the testimony offered by each of the four members of the Evaluation Committee who testified at hearing proves their diligence and thoughtfulness in evaluating all the materials before them during the scoring process.
The evaluators exercised reasonable discretion and provided comments and responses for the scores provided in the evaluation. Some of the evaluators reached different conclusions as to which proposal was better. Not every evaluator ranked Anchor Towing's proposal as his number one choice. One evaluator ranked Sunshine Towing as his first choice, while another ranked Midtown Towing as his. This does not show favoritism or bias towards one Proposer over another. It also demonstrates that the scoring was done in a thoughtful manner, not without deliberation or reason. By not proving that the Department's scoring methodology resulted in Petitioner's proposal receiving unfair treatment or Intervenor's proposal having somehow received an unfair competitive advantage due to the scoring methodology employed, Petitioner has failed to meet its burden of proof on the issue of whether the Department's scoring methodology was arbitrary and capricious. Accordingly, Petitioner's argument on this point must similarly fail.
Petitioner's challenge to the scoring methodology was mainly premised on its argument that the evaluators scored the sub- categories individually, something that was not specifically spelled out in the RFP. Petitioner has failed to meet its burden of proving that either it should be awarded the contract as the second highest Proposer or
that the proposals should be rejected and the RFP re-opened for new proposals.
Anchor's Fee Motion only asserts that it should obtain fees on Sunshine's claim that the scoring was arbitrary and capricious because the fact that Sunshine Towing would have scored its proposal higher than the evaluators, did not establish a factual legal basis to support the bid protest. Anchor does not properly characterize Sunshine's claim.
Whether Sunshine had material facts at its disposal to determine that Matthew O'Brien, one of the evaluators, was biased against its proposal or it as a company.
Sunshine contended in its Protest that as a result of Matthew O'Brien's involvement in a certain billing disputes involving significant amounts of money owed by the Department to Sunshine, the Department should not have selected him as an evaluator, given "the appearance of bias, or actual bias."
Anchor's sole basis for the claim for fees is the argument that Sunshine should have known that subtracting Mr. O'Brien's scores did not change Anchor's status as the highest scored bidder.
The ALJ found in the Amended Recommended Order that:
Petitioner failed to establish that evaluator Matthew O'Brien was biased against Sunshine Towing. Changing to a more professional demeanor when dealing with the business of paying invoices for "Road Ranger" services in a timely fashion does not evidence any bias on his part against Sunshine Towing. Moreover, even if Mr.
O'Brien's scores were removed from the mix due to alleged bias on his part, Anchor Towing would still have received the highest score when averaging the other four evaluators.
Whether Anchor was required to attach a certificate of occupancy to its response to the RFP for the premises from which the contract will be serviced; whether Sunshine had material facts to support this claim; whether Anchor was required to control the premises at 7444 Northwest 8th Street, Miami, Florida; and whether Sunshine's claim in this regard was supported by material facts.
The Anchor Fee Motion argued that Sunshine knew or should have known that "there is no requirement in the RFP that a proposer attach a certificate of occupancy for the premises from which the contract will be serviced."
However, the first Recommended Order contained Finding of Fact No. 53, which stated:
[Anchor's] response to the RFP did not contain a copy of the firm's Certificate of Occupancy for business premises from which to conduct the services solicited by the RFP as set forth in section 20.2.1.(iii)(c) of the RFP. (Exhibit 3, first Recommended Order, p. 14).
Although this finding refers to Subsection (c) of Section 20.2.1.(iii), this is a typographical error. The ALJ intended to refer to Subsection (e) of Section 20.2.1.(iii). Subsection (e) specifically discusses Certificates of Occupancy and states:
The Proposer shall include a copy of the current, permanent Occupational License, a copy of a Certificate of Occupancy as well
as the current documentation demonstrating corporate or LTD Partnership registration with the State of Florida. (Exhibit 1, page 11 of 22).
In the Amended Recommended Order in the Sunshine Protest, the ALJ found that "[s]ection 20.2.1.iii(e) also requires all proposers to include a Certificate of Occupancy in their proposals" and that "Anchor Towing's proposal did not contain a copy of the company's Certificate of Occupancy for the business premises from which to conduct the services described in the RFP."
In addition to the requirement in Section 20.2.1.(iii)(e) of the RFP, Section 20.2.2.(ii)(a) of RFP 6063 states that "the Proposer shall provide the description, location and availability of all the Proposer's facilities, staff and equipment as they currently exist and as they will be employed for the purposes of this contract."
In addressing Section 20.2.2.(ii)(a), the ALJ found in its Amended Recommended Order:
In its proposal, Anchor Towing disclosed that it proposed to operate the contract contemplated by the RFP from 7444 Northwest 8th Street, Miami, Florida. Anchor Towing had not bought or leased this location at the time it submitted its proposal.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this
proceeding pursuant to Sections 120.569, 120.57, and 57.105, Florida Statutes.
Section 57.105, Florida Statutes, provides:
Upon the court's initiative or motion by any party, the court shall award a reasonable attorney's fee to be a paid in equal amounts by the losing party and the losing party's attorney on any claim or defense at any time during a civil proceeding or action in which the court finds that the losing party or losing party's attorney knew or should have know that a claim or defense when initially presented to the court or at any time prior to trial:
was not supported by the material facts necessary to establish the claim or defense; or
would not be supported by the application of then existing law to those material facts.
However, the losing party's attorney is not personally responsible if he or she has acted in good faith, based upon the representations of his or her client as to the existence of those material facts. If the court awards attorney's fees to claimant pursuant to this subsection, the court shall award prejudgment interest.
Paragraph (1)(b) does not apply if the court determines that the claim or defense was initially presented to the court as a good faith argument for the extension, modification, or reversal of existing law or the establishment of new law, as it applied to the material facts, with a reasonable expectation of success.
At any time in any civil proceeding or action in which the moving party proves by a preponderance of the evidence that any action taken by the opposing party, including, but not limited to, the filing of any pleading or part thereof, the assertion of or response to any discovery demand, the
assertion of any claim or defense, or the response to any request by any other party, was taken primarily for the purpose of unreasonable delay, the court shall award damages to the moving party for its reasonable expenses incurred in obtaining the order, which may include attorney's fees, and other loss resulting from the improper delay.
A motion by a party seeking sanctions under this section must be served but may not be filed with or presented to the court unless, within 21 days after service of the motion, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.
In administrative proceedings under chapter 120, an administrative law judge shall award a reasonable attorney's fee and damages to be paid to the prevailing party in equal amounts by the losing party and a losing party's attorney or qualified representative in the same manner and upon the same basis as provided in subsections (1)-(4). Such award shall be a final order subject to judicial review pursuant to s.
120.68. If the losing party is an agency as defined in s. 120.52(1), the award to the prevailing party shall be against and paid by the agency. A voluntary dismissal by a nonprevailing party does not divest the administrative law judge of jurisdiction to make the award described in this subsection.
The Sunshine Protest
To successfully obtain fees, pursuant to Subsection 57.105(1), Florida Statutes, a party must demonstrate that it prevailed in defending against unsupported claims or defenses.
As a result of the 1999 amendments to the criteria set forth in Section 57.105, a party seeking fees no longer has to prevail on the entire case in order to recover fees under
Section 57.105. As the court pointed out in Forum v. Boca Burger, Inc., 788 So. 2d 1055, 1061 (Fla. 4th DCA 2001), "[N]o
longer does the statute apply only to an entire action; it now applies to any claim or defense."
Further emphasizing that a party seeking fees under amended Section 57.105, Florida Statutes, need not prevail in the entire litigation, courts have even held that "the court may award attorney's fees for a particular claim or defense, even before the case has been concluded." Bridgestone/Firestone, Inc. v. Herron, 828 So. 2d 414, 417 (Fla. 1st DCA 2002) (emphasis added).
Here, Sunshine initially prevailed in the Anchor Protest and no appeal was taken. Moreover, even after remand by the Department, Sunshine prevailed as to each of the specific issues now asserted in its Fee Motion.
The Department upheld and found binding on all of the parties all findings of fact and conclusions of law in the first Recommended Order and entered into a contract with Sunshine.
The Department's remand for a new evaluation did not alter Sunshine's status as a prevailing party on the issues for which it now seeks fees, as the remand was based on actions taken by the prior evaluation committee before RFP 6063 had even been advertised. The evaluation committee's actions presented
issues that were completely separate and distinct from the claims made in Anchor's Protest.
In addition, the Remand Order did not set aside the Final Order or contract. It only required a new evaluation, while the findings of fact and conclusions of law remained intact and binding on the evaluators and the Department in the second evaluation.
The particular claims asserted in the Anchor Protest for which Sunshine seeks an award of fees and costs clearly fall within the purview of Section 57.105, Florida Statutes, as Sunshine was the prevailing party with respect to these claims and Anchor knew or should have known that the claims were not supported by material facts necessary to establish the claim or by the application of then existing law to those facts.
Sunshine's RFP Format
Anchor claimed that Sunshine's proposal failed to follow the organizational format set forth in the RFP, and that Sunshine should therefore be deemed non-responsive.
In Finding of Fact No. 52 of the first Recommended Order, the ALJ found that "Anchor's response to the RFP did not follow the organizational format of the Technical Proposal Format set forth in the RFP in that it was not sequentially numbered and was not indexed as set forth in Section 20.4 of the "Special Conditions" to the RFP." The ALJ concluded that "the
evidence at the hearing clearly established that neither [Anchor] nor [Sunshine] submitted the proposal in the required format." Citing the Intercontinental Properties case, the ALJ concluded that:
The evidence at hearing as well as applicable case law lead to the conclusion that [Anchor] lacks standing to raise the issue of [Sunshine's] failure to follow the organizational proposal format . . . since [Anchor's] proposal suffered from the same defect. (Exhibit 3, para. 87, p. 22).
The court also concluded that, as a matter of law:
In addition to [Anchor's] lack of standing to raise the argument concerning the organizational format, [Anchor's] challenge to [Sunshine's] proposal on this ground fails because the organizational requirement is a minor irregularity which the Department may waive pursuant to Fla. Admin. Code R. 60A-1.001(17) and section 11.5 of the RFP. (Exhibit 3, para. 89, p. 23).
Anchor and its counsel should have known when they filed the Anchor Protest and prior to the final hearing in the Anchor Protest that Anchor's proposal did not comply with the organizational format. Prior to filing its protest, Anchor clearly had the opportunity to review its own proposal to confirm whether it, likewise, suffered from the minor waivable irregularity. A review of Anchor's proposal would have been all it took to ascertain the fact that Anchor's proposal was not indexed or sequentially numbered.
Thus, Anchor and its counsel knew or should have known when it filed the Anchor Protest, and before the Final Hearing in the Anchor Protest, that under the well-established law in Intercontinental Properties, Anchor could not protest on this basis, because Anchor's proposal also failed to comply with the organizational format requirements of the RFP.
Counsel for Anchor knew or should have known that Anchor's claim that Sunshine's proposal failed to follow the Technical Proposal Format was not supported by the application of then existing law to the facts.
Sunshine provided Anchor with notice of its intent to challenge this claim pursuant to Section 57.105, Florida Statutes, and provided Anchor an opportunity to withdraw it, but Anchor did not avail itself of that opportunity. Therefore, Sunshine is entitled to an award of attorney fees and costs under Section 57.105, Florida Statutes.
Sunshine's Litigation History
Anchor and its counsel were aware of the provision in the RFP requiring disclosure of litigation history. Section 20.2.1.(iii)(g) of the RFP states:
The Proposer shall indicate if their company or any of their principal officers, employees or owners have been involved with any lawsuits or judgments against the individual or the firm.
They shall include a list of all outstanding judgments (if any) relating to towing or storage activities.
Anchor should have known at the time it submitted its proposal the litigation that Anchor, its principal officers, employees or owners were involved in. Anchor was in the best position to discern and should have provided its counsel that information.
Anchor, as Sunshine discovered and thereafter advised Anchor, did not include a complete list of its litigation history in its proposal. It excluded a number of litigation matters, as set forth in the findings of fact in the first Recommended Order.
Although Anchor and its counsel were clearly advised that Anchor had not disclosed all its litigation history, Anchor continued to pursue its claim that Sunshine's proposal was not responsive because it did not include Sunshine's litigation history.
Anchor's counsel pursued this claim although it recognized that it could not prevail under Intercontinental Properties. After learning that Anchor had not fully disclosed its litigation history, Anchor's counsel admitted to the Court that "as an officer of the court, that based upon the holding of Intercontinental Properties, it would be difficult for me to
prevail on that issue because I may be estopped based on those, even though I would argue de minimus, failure to comply."
However, there is no exception to Intercontinental Properties which allows a protester to pursue a claim if the protestor, or anyone else for that matter, deems the defect in the protester's proposal "de minimus" compared to that of the contract recipient. And Anchor's counsel made no good faith attempt to argue for an extension of existing law based on any alleged "de minimus" exception.
Anchor's continued pursuit of this claim was contrary to well-established law set forth in Intercontinental Properties, which precludes a bid protest based upon a deficiency from which the protestor also suffers.
Accordingly, Anchor's claim that Sunshine's proposal did not provide the required litigation history was not supported by the application of then existing law to the facts. Sunshine provided Anchor with notice of its intent to challenge this claim pursuant to Subsection 57.105(4), Florida Statutes, and provided Anchor an opportunity to withdraw it, but Anchor did not avail itself of that opportunity. Therefore, Sunshine is entitled to an award of attorney fees and costs under Section 57.105, Florida Statutes.
Sunshine's Acknowledgement of Non-Existent Addendum 2
Anchor claimed that Sunshine's proposal should be declared non-responsive because "it failed to acknowledge receipt of Addendum Two."
Anchor offered no evidence in the Anchor Protest to establish that an Addendum Two existed, and the ALJ found in the first Recommended Order that "no evidence was produced to demonstrate that an 'Addendum Two' even existed."
Where a party fails to offer any evidence in support of its claim, as Anchor failed to do here, that claim is not supported by the material facts necessary to establish that claim and fees shall be awarded pursuant to Section 57.105, Florida Statutes.
Sunshine provided Anchor with notice of its intent to challenge this claim pursuant to Subsection 57.105(4), Florida Statutes, and provided Anchor an opportunity to withdraw, it but Anchor did not avail itself of that opportunity. Therefore, Sunshine is entitled to an award of attorney's fees and costs under Section 57.105, Florida Statutes.
Amount of Fees Awarded to Sunshine
Based upon the foregoing, Sunshine is entitled to an order awarding it the reasonable attorney's fees incurred in defending against Anchor's claims.
As reflected in the invoices from Steel Hector & Davis to Sunshine attached to the Sunshine Amended Fee Motion, the total fees incurred by Sunshine in successfully defending against the Anchor Protest were $138,317.50.
Anchor stipulated that the rates charged by all Steel Hector time-keepers on the invoices were reasonable.
This protest (as well as the Sunshine Protest) has been contentious and vigorously litigated by all parties.
Given the manner in which the law firms in both protests kept their billing records, it is not possible for any law firm to segregate how much time was devoted to any particular issue.
Under these circumstances, the ALJ finds it is reasonable to award 50 percent of the fees incurred by Sunshine in connection with its defense of the foregoing claims for a total amount of $69,158.75.
Anchor's Fee Motion
In order for a claim to fall within the category of unsupported claims and defenses that warrant fees pursuant to Section 57.105, Florida Statutes, "the trial court must find the action to be frivolous or so devoid of merit both on the facts and law as to be completely untenable." Murphy v. WISU Props., 895 So. 2d 1088, 1093-94 (Fla. 4th DCA 2004).
Simply prevailing on a claim or defense is not enough. Courts recognize that despite the statutory purpose to discourage baseless claims, Section 57.105, Florida Statutes, does not apply in every case. Fairview Props. Inc. v. Pate
Constr. Co., 638 So. 2d 998 (citing Whitten v. Progressive Cas. Ins. Co., 410 So. 2d 501 (Fla. 1982)). The standard requiring a total lack of justiciable issue is required to recover fees no matter how the claim is resolved. Muckenfuss v. Deltona Corp.,
508 So. 2d 340 341 (Fla. 1987) (quoting Whitten, 410 So. 2d at 501).
Consequently, the Fourth District's per curiam affirmance of the Final Order in the Second Protest, while the law of the case, has no bearing on the outcome of Anchor's Fee Motion. See also Department of Internal Affairs v. District Court of Appeal, 434 So. 2d 310, 311 (Fla. 1983) (citing Schooley v. Judd, 149 So. 2d 587, 590 (Fla. 2d DCA), rev'd on other grounds 158 So. 2d 514 (Fla. 1963): "[w]e are of the view that such a decision does not establish any point of law; and there is no presumption that the affirmance was on the merits").
The court's findings must be based upon substantial competent evidence that is already in the trial court record or is introduced at a hearing on the attorney's fee motion. See Strothman v. Henderson Mental Health Center, Inc., 425 So. 2d. 1185 (Fla. 4th DCA 1983).
The court may award fees whether the claim or defense was frivolous when filed or if it became frivolous any time after the suit was filed. Weatherby Associates, Inc. v. Ballack, 783 So. 2d 1183 (Fla. 4th DCA 2001).
Sunshine was originally awarded RFP 6063.
Misconduct of the initial evaluation committee led the Department to order a second evaluation, and RFP 6063 was then awarded to Anchor after the Department had already signed a contract with Sunshine.
Sunshine thus was protesting the award to Anchor of a contract into which it had already entered with the Department.
Anchor argues in its Fee Motion that every claim asserted in Sunshine's Protest entitles Anchor to fees pursuant to Section 57.105, Florida Statutes. However, Anchor only gave Sunshine notice as required by Subsection 57.105(4), Florida Statutes, that it would seek fees with respect to the claim asserted in Sunshine's original petition, and by order dated July 27, 2007, the undersigned issued an Order finding that Anchor could raise only those claims in its Fee Motion.
The undersigned further clarified at the July 31, 2007, hearing that the issues identified in the July 27, 2007, Order were intended to coincide with Anchor's Fee Motion and did not expand the scope of the Fee Motion.
Whether Sunshine lacked standing to bring its protest due to its failure to have been providing the type of services required for a minimum of five years in good corporate standing.
Anchor asserts that Sunshine and its counsel knew or should have known at the time that the Protest was filed that Sunshine lacked "standing" to protest because the RFP required that bidders be "in good corporate standing" for five years prior to bid submittal and Sunshine was not. Anchor further argues that Sunshine's purported standing defect taints the entirety of the Sunshine Protest, thereby entitling Anchor to fees and costs for defending the whole protest, not just that aspect of the protest relating to standing.
The court concludes, however, that Sunshine's claim that it had the legal right to file a protest, even assuming it did not meet the "five-year requirement," does not warrant fees under Section 57.105, Florida Statutes.
Subsection 120.57(3), Florida Statutes, applies "to protests to contract solicitation or award." Subsection 120.57(3)(b), Florida Statutes, states that "any person who is adversely affected by the agency decision shall file with the agency a notice of intent to protest in writing "
In Preston Carroll v. Florida Keys Aqueduct Authority, 400 So. 2d 524, 525 (Fla. 3d DCA 1981), the Third District Court of Appeal stated:
in order to contest the award of a public contract to an apparent low bidder, appellant was required to establish that it had a 'substantial interest' to be determined by the agency. A second lowest bid establishes that substantial interest. .
. We hold that Preston Carroll, as the third low bidder, was unable to demonstrate that it was substantially affected; it therefore lacked standing to protest the award of the contract to another bidder.
In Fairbanks v. Department of Transportation, 635 So.
2d 58, 59 (Fla. 1st DCA 1994), the First District Court of Appeal cited the Agrico Chemical case and stated:
to establish entitlement to a section 120.57 formal hearing, one must show that its 'substantial interests will be affected by proposed agency action.' Section 120.52(12), 120.57, Fla. Stat., 1991. This
in turn requires a showing that (1) the proposed action will result in injury-in- fact which is of sufficient immediacy to justify a hearing; and (2) the injury is of the type that the statute pursuant to which the agency acted is designed to protect.
See also United Health, Inc. v. Department of Health & Rehabilitative Services, 579 So. 2d 342 (Fla. 1st DCA 1991); Couch Const. Co. v. Dep't of Trans., 361 So. 2d 184, 186 (Fla. 1st DCA 1979).
Based upon the foregoing statutes and case law, Sunshine concluded that it had a "substantial interest" that would be "adversely effected" by proposed agency action, and thus had the legal right to protest the agency's intended award. As the second ranked bidder (who had not been declared non-
responsive by the agency), Sunshine had a factual and legal basis for contending that, under Subsection 120.57(3)(b), Florida Statutes, it possessed the requisite "substantial interest" that was being "substantially affected" by agency action, and could protect that interest by being a "party" to the protest proceeding.
Sunshine's assertion, while not adopted by the ALJ and the Department, was not so devoid of any merit so as to warrant the imposition fees under Section 57.105, Florida Statutes. While this court did find that Sunshine lacked "standing" under Intercontinental Properties, that does not mean that Sunshine did not have standing to file a protest in the first place. Indeed, the term "standing" is not even specifically used in Intercontinental Properties, nor did the court in that case rule that the protestant was not "adversely affected" so as to be precluded from filing a protest in the first place. What Intercontinental Properties did say is that "a party protesting an award to the low bidder must be prepared to show not only that the low bid was deficient, but must also show that the protestor's own bid does not suffer from the same deficiency." Intercontinental Properties, 606 So. 2d at 384. This is certainly not the same as saying, as Anchor in essence does, that a person's own bid suffers from the same deficiency,
that person should not have been entitled to file a protest in the first place.
In Intercontinental Properties, as here, the deficiency at issue is bid responsiveness. As stated in State
Bd. of Optometry v. Florida Soc. of Ophthalmology, 538 So. 2d 878, 881 (Fla. 1st DCA 1988), the issue of whether someone challenging agency action has standing to challenge that action is different from whether the person is entitled to prevail on the merits.
Based upon the foregoing, while this court and the Department did not agree with that analysis, Sunshine had a valid legal basis for contending that the analysis in Intercontinental Properties did not apply to this case so as to constitute a "good faith argument for the extension . . . or modification of existing law" under Subsection 57.105(2), Florida Statutes. Accordingly, Anchor's claim for fees on this point is denied.
In addition, there are no grounds for an award of attorney's fees based upon Anchor's standing claim since there were ample facts supporting Sunshine's position that it complied with the RFP's "five-year corporate standing requirement, as set forth above."
Finally, Sunshine presented a good faith argument for the extension of existing law, which pursuant to
Subsection 57.105(2), Florida Statutes, may not serve as a basis for a fee award. Even though the ALJ ultimately determined that only a legally existing corporation can be "in good corporate" standing, no case law was cited by Anchor supporting that conclusion. In fact, Anchor recognized in the First Protest that that no Florida court has used the phrase "good corporate standing" in an appellate opinion.
In its Proposed Recommended Order, Sunshine cited cases supporting the legal proposition that an agency's interpretation of a term in its own RFP, like that given by Ms. Lyons, will be deferred to if the agency provides a reasonable interpretation of that term. See, e.g., Phoenix
Painting Company v. Department of Health and Rehabilitation Services, 1994 Fla. Div. Adm. Hear. LEXIS 5946, November 9, 1994 (upholding agency's interpretation of a term in an Invitation to Bid because the agency "explicated a valid basis for its construction of the term in its bid specifications and applied the construction even-handedly to all bidders); The Ad Team of Florida, Inc. v. Department of Lottery, 1992 Fla. Div. Adm.
Hear. LEXIS 6269, January 7, 1992 (the agency's interpretation of a critical term of an RFP does not have to be the only interpretation, or even the most desirable interpretation; it enough if it is a permissible interpretation, or a reasonable interpretation).
Moreover, fees are not appropriate where a term is susceptible to two different interpretations. See Peyton v. Horner, 920 So. 2d 180 (Fla. 2d DCA 2006) ("the Court's determination that a party's interpretation of a contract is incorrect does not mean the other party is necessarily entitled to Section 57.105 attorney's fees.").
Thus, Sunshine had a valid basis to claim that, under Subsection 57.105(2), Florida Statutes, the facts as well as existing law or a modification of existing law, supported the claim that under the Department's consistent application and interpretation of the "five-year requirement," Sunshine did not lack five years of good corporate standing, and was qualified to bid on the RFP.
Whether Sunshine lacks standing to protest on the basis that Anchor failed to disclose the felony conviction of Mr. Savits.
Paragraph 66 of the Sunshine Protest claims that Anchor should be declared non-responsive (and not responsible) "as a result of its failure to disclose the felony conviction of Christopher Savits" as required by the second sentence of Section 20.2.1.(iii)(g) of the RFP which states that for the bidder and any of its "principle [sic] officers, employees or owners," the proposal "shall include a list of all outstanding judgments (if any) relating to towing or storage activities."
Sunshine alleged that Mr. Savits was a principal officer, employee or owner of Anchor and that Anchor failed to comply with the requirement in the second sentence of
Section 20.2.1.(iii)(g).
Intercontinental Properties did not prevent Sunshine from asserting this claim because Sunshine did not have any "principle officers, employees or owners" with any "felony judgments relating to towing or storage activities." Therefore, Sunshine's proposal did not suffer from the same alleged defect
–- a failure to list felony convictions related to towing and storage -– as the Anchor proposal.
The Recommended Order and Final Order in Sunshine's Protest concluded that Mr. Savits' conviction did not need to be disclosed because Mr. Savits was not an officer, employee, or owner of Anchor. Further, there were no findings of fact or conclusions of law that Sunshine could not protest Anchor's failure to disclose the felony conviction of Mr. Savits on these grounds based upon the holding in Intercontinental Properties.
Accordingly, Anchor did not prevail on this issue and it cannot serve as a basis for an award of fees.
Moreover, Sunshine relied on numerous facts, as set forth above, to support the conclusion that Section 20.2.1.(iii)(g) of the RFP contained two separate and distinct requirements.
Sunshine's claim that were two separate requirements in Section 20.2.1.(iii)(g) and that Intercontinental Properties did not preclude it from asserting that Anchor had failed to comply with the second prong of Section 20.2.1.(iii)(g), was supported by material facts, and existing law and therefore does not establish a basis for fees.
Whether Anchor Towing established that Mr. Savits was not its officer, director, principal or employee, yet Sunshine Towing protested the intended award of the contract to Anchor Towing on this basis.
Anchor's assertion that it is entitled to fees because the ALJ concluded Mr. Savits was not an owner or officer of Anchor was inconsistent with the ALJ's and Department's Orders in both Protests.
Anchor did not prevail on this claim and is, therefore, not entitled to an award for fees based on it.
Regardless, Sunshine's claim that Mr. Savits was an owner, officer or employee was supported by material facts and existing law.
Whether the scoring of four of the five evaluators was arbitrary and capricious and not supported by the application of existing law to the material facts of how the four evaluators scored Sunshine Towing's proposal.
Sunshine's Original Petition raised specific facts and arguments as to why certain scores entered by the evaluators were, in Sunshine's view, arbitrary and capricious.
Anchor's Fee Motion gave no specific reasons why the allegations in the Sunshine Protest were unsupportable factually or under applicable law.
Because Anchor's Fee Motion contained only conclusory statements, it did not provide Sunshine with any basis on which to evaluate whether its claim should be withdrawn, and it cannot serve as a basis for a fee award.
Although Sunshine was unsuccessful in prevailing on its claim of arbitrary and capricious scoring, it had a factual and legal basis for challenging the scoring procedure, just as Anchor had when it challenged the evaluators' scoring in the prior Protest.
Whether Sunshine Towing had material facts at its disposal to determine that Matthew O'Brien, one of the evaluators, was biased against Sunshine's proposal or Sunshine.
Anchor claims it is entitled to fees for defending this claim because Sunshine should have known that subtracting Mr. O'Brien's scores did not change Anchor Towing's status as the highest scored bidder.
Anchor's argument ignores the complete scope of the allegations in the Sunshine Protest and the relief that would result had the ALJ agreed with Sunshine's allegations.
Taking Mr. O'Brien's score "out of the mix," the differential between the scores of Anchor and Sunshine shrunk to
1.75 points out of a possible 100 points. The Sunshine Protest
alleged numerous scoring errors by the evaluators. Given the mere 1.75 point differential after taking Mr. O'Brien's scores out of the mix, had the ALJ also found error in even one of the scoring errors by the other evaluators, Sunshine's score could have beat Anchor's score.
Prior DOAH Orders cited by Sunshine in its Protest, along with the Remand Order the Department entered in this case directing a new evaluation based on possible evaluator bias, also provided a legal basis, or at a minimum a good faith argument, for the extension of the law that provides for reversal of an award where there is an appearance of and opportunity for favoritism. See Compass Environmental v. Shaw
Environmental, Inc., 2005 Fla. Div. Adm. Hear. LEXIS 945, March 21, 2005 (rescinding an award where one evaluator had a professional relationship with the top-ranked vendor).
Accordingly, Sunshine's claim was supported by material facts and existing law and does not provide a basis for an award of fees to Anchor.
Whether Anchor Towing was required to attach a certificate of occupancy to its response to the RFP for the premises from which the contract will be serviced; whether Sunshine Towing had material facts to support this claim; whether Anchor Towing was required to control the premises at 7444 Northwest 8th Street, Miami, Florida; and whether Sunshine Towing's claim in this regard was supported by material facts.
Sunshine's claims regarding the Certificate of Occupancy and control of its location are intertwined.
The Sunshine Protest alleged that Anchor Towing's proposal did not contain a copy of the firm's Certificate of Occupancy for business premises from which to conduct the services, as required by the RFP, and consequently Anchor Towing enjoyed the competitive advantage of submitting its proposal with only a potential location.
Although the ALJ concluded Anchor's failure to include a certificate of occupancy was a minor irregularity that was waivable by the Department, Sunshine had a factual basis for asserting that the Certificate of Occupancy and actual location was required as set forth above.
Sunshine also had a legal basis for asserting failure to include the Certificate of Occupancy was more than a minor irregularity. A deficiency is generally not deemed minor if, as a result of the deficiency, the proposer gains a competitive advantage. See Ad Team of Florida Department of Lottery, 1992 Fla. Div. Adm. Hear. LEXIS 6269 (recognizing that failure to supply information requested by the RFP may afford a bidder a competitive advantage). Here Sunshine asserted Anchor was receiving an advantage because of the point award it received from the evaluators based upon the appearance created in the proposal that it did in fact possess a facility which it did not.
Without this requirement, a proposer could include a description of any imaginary facility in its proposal from which it intended to perform the services required in the RFP, and then obtain a high award of points from the evaluators based upon that description while never disclosing to the evaluators that the proposer did not own, lease, or otherwise have any right to possess that fictitious facility.
Accordingly, Sunshine's claim was supported by material facts and existing law and does not provide a basis for an award of fees to Anchor.
ORDER
Based on the foregoing Findings of Fact and Conclusions of Law, it is
ORDERED that Sunshine's Fee Motion is GRANTED as follows and Anchor's Fee Motion is DENIED as follows:
Sunshine shall receive an award of attorney's fees pursuant to Section 57.105, Florida Statutes, for defending against the following three claims asserted by Anchor in the First Protest:
Sunshine's bid submittal was non- responsive because it allegedly failed to follow the Technical Proposal Format set forth in the RFP;
Sunshine's bid submittal was non- responsive because it allegedly failed to provide information regarding its litigation history as required by the RFP; and
Sunshine's bid submittal was non- responsive because it allegedly failed to provide an acknowledgement of an alleged "Addendum Two" to the RFP.
Fees shall be awarded against Anchor and its counsel in the amount of $69,158.75.
Anchor's Fee Motion is denied with respect to each of the claims asserted therein.
DONE AND ORDERED this 6th day of June, 2008, in Tallahassee, Leon County, Florida.
S
ROBERT S. COHEN
Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675 SUNCOM 278-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 6th day of June, 2008.
ENDNOTE
1/ All references to statutes are to Florida Statutes (2007) unless otherwise noted.
COPIES FURNISHED:
John C. Shawde, Esquire Kelly A. O'Keefe, Esquire Berger Singerman, P.A.
200 South Biscayne Boulevard, Suite 1000 Miami, Florida 33131
C. Denise Johnson, Esquire Department of Transportation
Haydon Burns Building, Mail Station 58 605 Suwannee Street
Tallahassee, Florida 32399-0450
Miguel A. De Grandy, Esquire Stephen M. Cody, Esquire Miguel De Grandy, P.A. Douglas Entrance
800 Douglas Road, Suite 850 Coral Gables, Florida 33134
Daniel H. Thompson, Esquire
315 South Calhoun Street, Suite 712 Tallahassee, Florida 32301
James C. Myers, Clerk of Agency Proceedings Department of Transportation
Haydon Burns Building, Mail Station 58 605 Suwannee Street
Tallahassee, Florida 32399-0450
Alexis M. Yarbrough, General Counsel Department of Transportation
Haydon Burns Building, Mail Station 58 605 Suwannee Street
Tallahassee, Florida 32399-0450
Stephanie Kopelousos, Secretary Department of Transportation
Haydon Burns Building, Mail Station 57 605 Suwannee Street
Tallahassee, Florida 32399-0450
NOTICE OF RIGHT TO JUDICIAL REVIEW
A party who is adversely affected by this Final Order is entitled to judicial review pursuant to Section 120.68, Florida Statutes. Review proceedings are governed by the Florida Rules of Appellate Procedure. Such proceedings are commenced by filing the original Notice of Appeal with the agency clerk of the Division of Administrative Hearings and a copy, accompanied by filing fees prescribed by law, with the District Court of Appeal, First District, or with the District Court of Appeal in the Appellate District where the party resides. The notice of appeal must be filed within 30 days of rendition of the order to be reviewed.
| Issue Date | Document | Summary |
|---|---|---|
| Jun. 06, 2008 | DOAH Final Order | Sunshine Towing, Inc., is entitled to an award of attorney`s fees pursuant to Subsection 57.105(1), Florida Statutes, in the amount of $69,158.75, for defending against three of the claims raised by Anchor Towing, Inc. |
DEPARTMENT OF CHILDREN AND FAMILY SERVICES vs ADOPTIONS BY CHOICE, INC., 04-004481F (2004)
DEPARTMENT OF TRANSPORTATION vs. HINSON OIL COMPANY, 04-004481F (2004)
DEPARTMENT OF TRANSPORTATION vs SUN CITY SHELL, INC., 04-004481F (2004)
DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION vs LISA ROBERTSON, 04-004481F (2004)
