NANCY B. FIRESTONE, District Judge.
In this post-award bid protest, Plaintiff EMTA Insaat, A.S. ("EMTA"), a Turkish commercial construction company, challenges the award of a fixed-price construction contract by the United States Air Force 39th Contracting Squadron ("the agency" or "the government") to repurpose a hangar at Incirlik Air Base, Turkey, to serve as the new military headquarters of the Combined Joint Special Operation Task Force-Syria (CJSOTF-S). The awardee is Artek Insaat, A.S. ("Artek"), another Turkish construction company.
EMTA filed its original complaint in this bid protest on September 4, 2015, claiming that the government failed to conduct a proper price realism analysis of Artek's lowest cost proposal, which, if done, would have (1) rendered Artek's proposal ineligible, and (2) resulted in the award of the contract to EMTA. The court held a status conference with the parties on September 8, 2015. On September 9, 2015, the government provided a description of the status of performance under the contract. The government's description included a schedule which anticipates groundbreaking on September 16, 2015 and "beneficial occupancy" by November 20, 2015. On September 10, 2015, EMTA applied for a temporary restraining order and preliminary injunction to prevent the government from going forward with performance while the bid protest is pending. In its motion, EMTA argues that it is likely to succeed on the merits and will be irreparably harmed without a temporary halt to construction.
On September 11, 2015, the government filed a response to EMTA's motion. In its response, the government argues that EMTA is not likely to succeed on the merits and that the government's and the public's interest weigh heavily against granting temporary injunctive relief and halting construction. The government included with its response a declaration from Major General Michael K. Nagata, who has been Commander of the Combined Joint Interagency Task Force-Syria (CJIATF-S) since October 17, 2014. CJIATF-S is a joint military command headquartered in Al Udeid Air Base, Doha, Qatar, with one subordinate organization, CJSOTF-S. CJIATF-S and CJSOTF-S are responsible for conducting the Syria Train and Equip Program.
The government's response to EMTA's motion also included a declaration from Colonel John C. Walker, who has been Commander of the 39th Air Base Wing at Incirlik Air Base since July 31, 2015. Colonel Walker also states that it is necessary to relocate the CJSOTF-S headquarters to Incirlik Air Base as soon as possible. Def.'s Opp'n A6-7. In addition, Colonel Walker states that "[t]here were, and currently are, absolutely no existing facilities at [Incirlik Air Base] that will meet CJSOTF-S's facility needs." Def.'s Opp'n A7. Colonel Walker similarly concludes that maintaining a "beneficial occupancy date" of November 20, 2015, "from an operational standpoint, is critical" and that [u]ltimately, a delay in relocating this headquarters is a threat to the success of the program." Def.'s Opp'n A8.
On September 14, 2015, EMTA filed a reply to the government's opposition, challenging the government's arguments. Also on September 14, 2015, EMTA filed an amended complaint with an additional allegation that the government improperly waived a requirement of the solicitation. Specifically, EMTA argues that Artek failed to provide a list of equipment and materials required to perform the contract and thus was not eligible for award.
On September 15, 2015, EMTA filed a supplemental reply to the government's opposition. EMTA attached to its supplemental reply documents that EMTA had received from the government but that had not been filed as part of the administrative record. These documents included an e-mail exchange regarding the treatment of weakness in various proposals, including Artek's and EMTA's proposals. On September 16, 2015, the government corrected the administrative record to include documents that were omitted from the initially filed record, including the e-mail exchange referenced in EMTA's supplemental reply. Finally, on September 17, 2015, the government filed a sur-reply.
The court has determined that oral argument is not necessary. For the reasons that follow, EMTA's Motion for a Temporary Restraining Order and Preliminary Injunction is
On July 2, 2015, the agency issued a Request for Proposals ("RFP" or "solicitation") to repurpose a hangar at Incirlik Air Base. Administrative Record ("AR") 622. The RFP provided that the government intended to award a firm fixed price contract to the lowest priced technically acceptable offeror in accordance with Federal Acquisition Regulation ("FAR") 15.101-2. AR 63. Also in the RFP, "[t]he Government reserve[d] the right to refrain from awarding to any contractor in the event that all Offerors [were] determined to have offered pricing that [was] not considered realistic, reasonable, or complete." AR 67.
The RFP specified how proposals would be evaluated. The RFP explained that the government would evaluate, in order, price and technical capability. With respect to evaluation of prices, the RFP provided that—
AR 67. Section L of the RFP (titled "Instructions, Conditions and Notices to Bidders") instructed offerors to complete a Construction Cost Estimate Breakdown Form INC 1101 ("Form INC 1101"). AR 86. Offerors were directed to include on Form INC 1101 all associated design, labor, material, overhead, and profit for the requested project.
Section M of the RFP (titled "Evaluation") described the basis for the contract award (Section M-1) and the evaluation factors and award process (Section M-2). AR 90-92. Section M-2 specified that the "[p]rices will be evaluated for completeness, reasonableness, and balance [in accordance with] FAR 15.305(a)(1) and FAR 15.404."
The RFP also explained that the government's technical evaluation team would evaluate proposals on an "acceptable" or "unacceptable" basis, and that only those proposals that clearly met the minimum requirements of the solicitation would be considered for award. AR 67, 91-92. Technical capability included two subfactors: technical capabilities and progress schedule. AR 67. In particular, the RFP required offerors to provide "[a] narrative to demonstrate a sound approach and methodology for accomplishing work requirements identified in the solicitation with the appropriate skills, equipment, and materials, in the appropriate quantities with specifications, and at the appropriate time to meet the Government's desired outcomes." AR 65, 87. This information was to "clearly demonstrate the contractor's capability to manage all resources required to perform the requirements outlined in th[e] solicitation."
The agency received five proposals by the due date of July 20, 2015. AR 622. All of the five proposals were sent to the technical evaluation team on the same day.
Both EMTA and Artek provided detailed price schedules, AR 115-35, 400-19, and narratives to show how they would produce an end product to meet or exceed contract requirements. AR 384-91, 580-84. EMTA and Artek also provided lists of construction materials they would use in the project and identified a manufacturer for each of the materials. AR 391-94, 437-39. EMTA identified 66 types of construction materials and Artek identified 81 types of construction materials.
The Source Selection Decision Document ("SSDD") states that the agency's initial technical evaluation identified five weaknesses in Artek's proposal. AR 625.
(4) "[i]t was determined . . . that the catalog data was in line with the requested specifications per the Statement of Work"; and (5) "[a]lthough specific quantities were not listed for each line item on [Artek's] material list, it was determined that the contractor had a good understanding of work to be performed and that quantities would be solidified during the design phase."
Although the SSDD does not expressly reference the price realism analysis provision from the solicitation, the agency prepared an "abstract of quotations" that compared all of the offers against the independent government cost estimate (IGCE), AR 621, and the SSDD includes the following discussion of Artek's proposed price:
AR 626. Ultimately, the agency determined that the proposal submitted by Artek offered the best overall value to satisfy contract requirements and that Artek met all requirements of the solicitation. AR 622. The SSDD states that the "selection was made [in accordance with] FAR 15.101-2, to the offeror whose evaluated proposal represented the lowest price and was considered to be technically acceptable" and that "[t]he documentation contained within this report indicates the basis of a fair and reasonable price determination." AR 627. On August 7, 2015, the agency awarded the contract to Artek. AR 629-30 (Contract No. FA 5685-15-C-0007).
In a memorandum dated August 7, 2015, the agency notified EMTA that its proposal was not selected for award. AR 662. The memorandum notes that five offerors were solicited and five proposals were received.
On August 11, 2015, EMTA requested a debriefing. AR 672. In a memorandum dated August 13, 2015, the agency provided a description of the source selection procedure and award. AR 675. The memorandum states that no significant weaknesses were identified in EMTA's proposal and presents the results of the government's evaluation findings.
EMTA protested the award at the agency level. EMTA claimed that the contract award to Artek was improper because Artek's price proposal was unrealistically low.
In a bid protest case, the standard of review of an agency's action is governed by the Administrative Procedure Act, 5 U.S.C. § 706. 28 U.S.C. § 1491(b)(4). This standard is "highly deferential."
A challenger may not use a bid protest as an opportunity to challenge the terms or requirements of the solicitation itself. In
Finally, in exercising bid protest jurisdiction, the court gives due regard to the interests of national defense and national security and the need for expeditious resolution of the action. 28 U.S.C. § 1491(b)(3);
In deciding whether to grant injunctive relief, a court considers: (1) whether the plaintiff is likely to succeed on the merits of the case; (2) whether the plaintiff will suffer irreparable harm if the court withholds injunctive relief; (3) whether the balance of hardships to the respective parties favors the grant of injunctive relief; and (4) whether it is in the public interest to grant injunctive relief.
EMTA argues that it is likely to prevail because the government failed to conduct a detailed price realism analysis as required by the FAR and the RFP. Specifically, EMTA alleges that the government was required, and failed, to conduct "some due diligence by examining the individual cost elements that each offeror was required to submit with their price proposals." Pl.'s Mem. 9.
In response, the government argues that EMTA has not demonstrated that it will succeed on the merits. The government acknowledges that it is bound by language in the RFP requiring a price realism analysis, but asserts that it adequately performed the price realism analysis required by the solicitation. In this connection, the government acknowledges that the SSDD does not use the term "realism," but argues that "the Government's reasoning supports the conclusion that the Government performed a price realism analysis." Def.'s Opp'n 15. The government adds that where "the RFP [does] not make any commitment[] to perform a price realism analysis in any particular manner[,] the methodology is left to the agency's discretion."
EMTA replies that the government's reliance on
EMTA also argues in its reply that the agency improperly waived a requirement of the solicitation by finding that Artek's technical proposal was acceptable when Artek failed to provide quantities for a number of items in its material list despite the RFP requirement to provide "[a] narrative to demonstrate a sound approach and methodology for accomplishing work requirements identified in the solicitation with the appropriate skills, equipment, and materials, in the appropriate quantities with specifications, and at the appropriate time to meet the Government's desired outcomes." AR 65, 87.
The court finds that EMTA is not likely to succeed on the merits. There is no dispute that the plain language of the RFP required the government to conduct a price realism analysis. The RFP provided that "[a]ll offerors['] proposed prices will be evaluated to ensure they are realistic, reasonable, and complete." AR 67. However, the RFP did not spell out how the price realism analysis would be conducted. While offerors were required to provide a detailed cost breakdown, the RFP made clear that "[e]ach offer received in response to this solicitation will be evaluated based on total proposed price."
In addition, the court agrees with the government that a review of the SSDD shows that even without use of the word "realism," the government examined Artek's price and concluded that it was not unrealistically low. AR 626. The SSDD notes that Artek's price was [. . .] percent lower than EMTA's price, but also discusses that Artek's overhead and profit were [. . .] percent lower than EMTA's rate and that Artek's labor costs were lower as well.
The court also finds that EMTA's second argument is not likely to succeed. The RFP required a narrative and material list in order "to demonstrate a sound approach and methodology for accomplishing work requirements . . . [and] clearly demonstrate the contractor's capability to manage all resources required to perform the requirements outlined in th[e] solicitation." AR 65, 87. Artek provided a detailed narrative to show how it would produce an end product to meet or exceed contract requirements, AR 580-84, and a list of materials it would use in the project and identified a manufacturer for each of the materials. AR 437-39. As noted, Artek did not include an estimated quantity for 32 of its 81 categories of construction materials.
EMTA argues that without early injunctive relief it will be irreparably harmed because it will likely lose the opportunity to be awarded the contract. The government asserts that economic harm for the lost opportunity represented by the pending procurement cannot alone satisfy the irreparable harm prong required for injunctive relief because it is present in nearly every successful bid protest. Instead, the government argues, in order to obtain injunctive relief, a plaintiff must establish that it was denied an opportunity to fairly compete for a contract and that the denial caused imminent harm that was "truly irreparable, e.g., the contractor would be forced out of business." Def.'s Opp'n 18. The government notes that EMTA has had many valuable government contracts and will not be forced out of business if it loses the opportunity to perform this one. Def.'s Opp'n 19 n.2.
As EMTA points out, this court has not required proof that the contractor would be forced out of business to show irreparable harm.
Here, the court concludes that EMTA, as the next lowest offeror, may be irreparably harmed without injunctive relief because it will likely lose the opportunity to perform this contract in light of the government's construction schedule.
Although EMTA recognizes the importance of the project at issue for military operations, it argues that a suspension of performance for less than 30 days to allow the court to review the case under the schedule agreed to by the parties will mitigate any harm. In response, the government argues that where, as here, the procurement implicates national security and foreign policy concerns that are critical to the success of military operations and to the health and safety of our servicemen and women in the field, no injunction should issue. Def.'s Opp'n 20 (citing
While EMTA suggests that a brief delay will not be harmful, the court agrees with the government that the national security, foreign policy, and public interest concerns at stake in this procurement clearly outweigh the potential economic loss to EMTA. The court is required to give due regard to these interests and professional military judgments.
For the reasons stated above, EMTA's Motion for a Temporary Restraining Order and Preliminary Injunction is