BOLGER, Justice.
Unsuccessful bidders on a public contract proposal filed a claim for intentional interference with prospective economic opportunity against four individual procurement committee members. The superior court found that
We affirm. The bidders failed to present a genuine issue of material fact regarding the committee members' alleged bad faith. In addition, the exclusive remedy statute bars the bidders' suit. The superior court did not abuse its discretion in awarding attorney's fees to the State.
Bachner Company and Bowers Investment Company (together, Bachner) were unsuccessful bidders on a state contract ultimately awarded to McKinley Development for an Alaska Department of Transportation office building in Fairbanks.
The committee used a three-pass scoring system. In each pass, committee members scored the proposals and then discussed the reasoning behind their scores. In subsequent passes, committee members adjusted their scores based on the discussions from the previous passes. After the second pass, the committee also visited each proposed site.
Separate from the committee scoring process, a procurement officer awarded ten additional points to bidders who qualified for the Alaska Offeror's/Bidder's Preference and up to 50 additional points for the proposal's price score. The committee had no control over the Alaska preference or the price scores. The committee's scores and the procurement officer's scores were then added together, and because McKinley had the highest score, it was awarded the lease.
In 2002, Bachner filed bid protests alleging irregularities in the bid scoring process.
In 2004, Bachner filed a separate suit against four procurement committee members as individuals.
The committee members moved to dismiss, arguing that: (1) Bachner's claims were barred by the exclusive remedy provisions of AS 36.30.690; (2) the committee members were entitled to absolute immunity; and (3) Bachner failed to state a § 1983 claim.
The superior court dismissed Bachner's § 1983 claim for failure to state a claim, but the superior court refused to dismiss Bachner's state-law claim because it found that Bachner's allegations of bad faith, if proven, would fall outside the scope of qualified immunity.
On remand, the committee members reasserted their argument that Bachner's state-law claim was barred by the exclusive remedy statute, but the superior court denied the motion, finding that the scope of the statute was co-extensive with qualified immunity. After discovery, the committee members moved for summary judgment, reasserting their exclusive remedy argument and arguing that they were protected by qualified immunity because Bachner failed to offer admissible evidence that could support an inference of bad faith. Bachner opposed and cross-moved for summary judgment, arguing that the committee members' conduct demonstrated bad faith as a matter of law.
In December 2011, the superior court denied both of Bachner's motions and granted the committee members' motion for summary judgment based on qualified immunity and the exclusive remedy statute. The court reasoned that Bachner presented no genuine issue of material fact and that, as a matter of law, the committee members' conduct could not be considered bad faith. Thus, the court held that qualified immunity barred the suit.
The court also concluded that the exclusive remedy statute barred the suit, but the court did not address whether the exclusive remedy provision extends to bad faith conduct. Bachner moved for reconsideration and moved to supplement the record with an affidavit, but the court denied both motions. The court found the committee members were the prevailing parties and awarded the State $93,871.85 in fees and costs. Bachner appeals.
We review a grant of summary judgment de novo, "reading the record in the light most favorable to the non-moving party and making all reasonable inferences in its favor."
The proper interpretation of a statute presents a question of law that we review de novo, "adopting the rule of law most persuasive
"A trial court's award of attorney's fees is generally reviewed for abuse of discretion."
The superior court, citing State, Department of Health & Social Services v. Doherty,
Collateral estoppel prohibits a party from relitigating an issue of fact if:
In Doherty, the element of privity was also the basis for denying collateral estoppel. Doherty involved a § 1983 claim against an Office of Children's Services social worker.
However, in Doherty we recognized that, generally "employees acting in their personal capacities are not in privity with the government and are not bound by adverse determinations against the government."
We concluded that the fact that the social worker testified and presented evidence did not mean that the social worker "had control over the litigation or the ability to pursue her personal interests."
Here, Bachner argues that the committee members are in privity with the State because: (1) the bid protests focused on the committee members' allegedly illegal actions; (2) the committee members had notice, an opportunity to be heard, and procedures protecting their interests in the administrative proceeding; (3) the Attorney General adequately represented their interests; (4) Madson defended the committee members' actions during the hearing; and (5) Weed was advised to seek independent legal counsel.
Bachner's arguments are very similar to the arguments in Doherty.
The procurement process requires procurement officers to exercise independent judgment and avoid conflicts of interest. Procurement officers are encouraged to utilize their knowledge and experience and to discuss bids with each other during the process. We have held that qualified immunity protects procurement officials in the exercise of these duties.
"Under a rule of qualified immunity, a public official is shielded from liability... when discretionary acts within the scope of the official's authority are done in good faith and are not malicious or corrupt."
For example, in Smith v. Stafford, we held that the plaintiff's affidavit "contain[ed] assertions indicating that a genuine issue of material fact exists concerning [the defendant's] state of mind with regard to the [plaintiff's claims]."
Similarly, in J & S Services, Inc. v. Tomter, the plaintiff alleged that a procurement official, "motivated by animosity against [the
Bachner's claim for intentional interference with prospective economic opportunity alleged that the committee members acted in bad faith. In response, the committee members claimed qualified immunity and submitted affidavits stating that they acted in good faith. The superior court viewed Bachner's evidence in the light most favorable to Bachner and drew all reasonable inferences in Bachner's favor. The court found that Bachner failed to present a genuine issue of material fact and that, as a matter of law, the committee members' conduct could not be considered bad faith.
We address each of Bachner's arguments in turn.
The Request for Proposals (RFP) and the RFP Evaluator's Guide for this project required the committee to evaluate, among other things, public convenience, including "location with other state agencies." Before the superior court, Bachner argued that Bennett and Senkow considered proximity to other state agencies in bad faith because they are both "long time DOT employees who wanted a new facility as close to the DOT headquarters ... as possible." Bachner argued that Madson told Bennett and Senkow that proximity to existing facilities was an impermissible criterion, but Bennett and Senkow ignored her and "recruited Weed into their conspiracy" to award the contract to McKinley. Bachner also claimed that Madson told the bidders at a pre-bid conference that proximity to the DOT site would not be considered.
The superior court noted that "location with other state agencies" was a published criterion in the RFP guide and observed that all parties agreed that adherence to the written criteria in the RFP guide was important. The superior court concluded, "Without some evidence suggesting the actions of the [committee] members were in fact wrongful on some level, the court cannot find bad faith."
On appeal, Bachner makes the same arguments. Bachner quotes the affidavit of Tom Roberts, a realtor who attended the pre-bid conference. Roberts stated that Madson told the bidders that proximity to DOT would not be considered and that it was not a published criterion.
Bachner does not appear to argue that any oral statements at the prebid conference actually modified the written terms of the RFP.
The RFP required all proposed buildings to have regularly scheduled bus service and a bus stop within 720 feet of a building entrance. A bid from Fountainhead Development was declared non-responsive because it included no plans to secure bus service. The McKinley proposal included a compliant bus stop, but the McKinley bus stop did not have bus service at the time of the proposal.
During a committee meeting, Madson (in the presence of Bennett and Senkow and another committee member) called the Fairbanks Bus Authority and spoke with acting Transportation Director Glenn Miller to determine
Before the superior court, Bachner claimed that the committee members wrongfully determined that the McKinley proposal met the public transportation requirement. Bachner argued that Miller's affidavit established that he told the committee that bus service "could" be provided if certain conditions were met, whereas Madson told Jones that bus service "would" be provided. In response, the committee members argued that: (1) the McKinley proposal included a bus stop; (2) the Committee called Miller, who told the Committee that service could be provided; (3) Jones advised Madson that the McKinley proposal met the public transportation requirement; and (4) the committee members swore that they acted in good faith.
The superior court concluded that, at best, Bachner's evidence established that the committee members incorrectly or imprecisely reported Miller's statements to Jones and incorrectly concluded that McKinley's proposal met the public transportation requirement. The superior court quoted Prentzel v. State, Department of Public Safety, where we said:
Citing Prentzel and Pauley v. Anchorage School District,
On appeal, Bachner again points to Miller's affidavit and argues that the committee members acted in bad faith when determining that the McKinley proposal complied with the bus service requirement. The committee members respond that, at best, Miller's affidavit establishes that "Madson imprecisely reported the details of her conversation to Vern Jones, misunderstood the nature of the city's bus service assurances, and/or negligently failed to ensure that the McKinley proposal met the public transportation requirement of the RFP," but it does not establish that Madson acted with an evil or a corrupt motive.
The committee members assert that Madson reasonably relied on the McKinley site plan proposal which showed a bus stop near the entrance to the McKinley building and a letter from Transportation Director Max Lyon to McKinley, which states:
(Emphasis added.) Further, Chief Procurement Officer Jones confirmed that McKinley's proposal met the requirement.
Given this evidence, we agree with the superior court's conclusion that Bachner failed to present a genuine issue of material fact regarding the public transportation issue. Madson and the committee followed a
In March 2002, after consulting with Chief Procurement Officer Jones and another state employee, Madson denied Bachner's bid protests.
Before the superior court, Bachner argued that Madson denied the bid protests in bad faith. The superior court rejected this argument, explaining that at the summary judgment stage malice cannot be a disputed question of fact, unless the record contains some objective evidence that would support an inference of malice.
Bachner's argument was based principally on Madson's inconsistent statements regarding the end date of the existing lease. Madson appears to have made a mistake about the ending date for the lease when she denied a stay of the award during Bachner's bid protest appeals. But there is nothing in the record that indicates that this mistake was made in bad faith. We therefore affirm the superior court's decision on the bid protest issue.
Before the superior court, Bachner claimed that Weed acted in bad faith by lowering his score for the Bachner proposal in order to counteract Madson's overly high scores for Bachner. Furthermore, Bachner alleged that Weed told Jerry Bowers, the principal owner of Bowers Investment, that he was opposed to the Bachner proposal because if it won, Weed and his staff would have to spend the next 40 years split between the ground floor and the basement in the Bachner building. And Bachner alleged that Weed told Bowers that Bennett and Senkow had pressured him not to vote for the Bachner proposal.
Weed's affidavit states that after the first round of scoring he became aware of the identity of the building described in the Bachner proposal and considered his personal knowledge of that building. Weed and Chief Procurement Officer Jones stated that the committee members may appropriately consider their personal knowledge and vary their scores between rounds. Weed argued that his score change to remedy perceived bias was a mistake in the scoring process and did not establish bad faith.
The superior court concluded that Weed may have placed "undue emphasis on indoor environment" when Weed considered that his staff would be split between basement and ground floors for the next 40 years. The court reasoned that Weed's attempt to correct the perceived bias of other committee members was a misunderstanding of his role in the procurement process. The court compared the facts to J & S Services, Inc. v. Tomter
A claim of unfair scoring of a public bid proposal does not show bad faith unless the misconduct is motivated by malice or personal interests.
The exclusive remedy state statute provides: "Notwithstanding AS 44.77 or other law to the contrary, AS 36.30.560-36.30.699 and regulations adopted under those sections provide the exclusive procedure for asserting a claim against an agency arising in relation to a procurement under this chapter."
In this case, all of the committee members were acting within the scope of their duties to review the RFP responses. Even Weed's decision to "shuffle his scores" was related to his official responsibility to identify the best proposal and not by any personal motive or advantage. And as we explained above, Bachner presented no genuine issue of material fact regarding bad faith acts by the committee members. We therefore do not have occasion to consider whether the exclusive remedy provision bars suits against individual committee members for bad faith acts done within the course and scope of official duties.
After the superior court's grant of summary judgment, Bachner moved for reconsideration and asked the court to consider Jerry Bower's December 30, 2011 supplemental affidavit. Citing Civil Rule 77(k) and Katz v. Murphy,
On appeal, Bachner argues that the superior court erred by refusing to consider Bowers's supplemental affidavit because the superior court's initial decision invented a new legal test by requiring affirmative proof of targeted animosity rather than inferential proof. Bachner claims that Bowers's affidavit could have met the new legal test.
The committee members argue that the superior court did not abuse its discretion in refusing to consider Bowers's affidavit because it is hearsay, in that it recites excerpts of an informal interview with a witness, John Burns. The committee members also argue that the affidavit was untimely because it was signed the day after the court issued its summary judgment order. In the alternative, the committee members argue that any error was harmless because Bowers's affidavit would not have changed the outcome.
Bachner's claims that the superior court enunciated a new standard of "targeted animosity"
Generally, a motion for reconsideration cannot be based on new information or arguments.
The court found the committee members were the prevailing parties and awarded the State $93,871.85 in fees and costs under Alaska Civil Rules 79 and 82. Bachner argues that the superior court should not have awarded fees because the committee members were represented by State attorneys and did not personally incur any legal costs. Bachner claims that the purpose of Rule 82 is to "partially compensate a successful litigant for actual fees incurred." This is incorrect. The purpose of Rule 82 is to "afford reasonable partial compensation for attorney's fees to the winning civil litigant."
Bachner also argues that fees should not have been awarded because the State acted as "in-house counsel." In response, the committee members correctly note that attorney's fees can be awarded for work performed by Attorney General's Office staff acting as in-house counsel.
Finally, Bachner argues that it is a public interest litigant and therefore protected from adverse fee awards. Again, the committee members correctly note that, even if public interest litigants are protected from adverse fee awards under AS 09.60.010(b)(3)(I), Bachner cannot be considered a public interest litigant due to its significant financial interest in this case. We therefore affirm the superior court's fee award.
Bachner failed to present a genuine issue of material fact that the committee acted in bad faith, and we conclude that the exclusive remedy statute bars Bachner's claim. For these reasons, we AFFIRM the superior court's grant of summary judgment in favor of all committee members. We also affirm the superior court's fee award.
WINFREE, Justice, not participating.