Acrow Corp. of America v. United States
2011 U.S. Claims LEXIS 5
Fed. Cl.2011Background
- This bid protest concerns TACOM’s award of Solicitation No. W56HZV-09-R-0480 for LOCB systems to Mabey Bridge & Shore, Inc. (MBSI); Acrow’s protest claims MBSI lacked a satisfactory record of integrity and ethics.
- The solicitation used a best-value evaluation with non-price factors (Experience, Technical, Small Business Participation) and price; experience equals price; overall non-price factors > price.
- MBSI’s affiliate MBL had previously acquired Mabey & Johnson Ltd. (M&J), whose executives faced a Serious Fraud Office investigation and a 2009 UK guilty plea for corrupt practices related to overseas contracts.
- The contracting officer conducted a responsibility review in 2010, requesting information on MBSI/MBL’s integrity and corrective actions in light of the M&J prosecution and related investigations.
- The contracting officer’s Memorandum for Record limited her focus to events surrounding the SFO prosecution of M&J; she acknowledged remedial actions and concluded MBSI/MBL were responsible, awarding to MBSI.
- Plaintiff argues the contracting officer should have reviewed the Danos counterclaim and broader corruption disclosures and that MBSI’s statements about not being involved were misrepresentations that affected the award decision.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether misrepresentation by MBSI vitiates responsibility | Danos counterclaim shows MBSI involvement; misrepresentation rendered officer's reliance prejudicial. | Officer did not rely on false statements; analysis focused on remedial actions and scope limited by her MAR. | No reversible error; misrepresentation not material to the decision. |
| Whether the Danos counterclaim should have been reviewed | Officer had a duty to review readily available Danos counterclaim and broader allegations. | Officer informed by SFO opening notes; Danos counterclaim is extraneous to her scope and not required. | Proper not to require review; decision within officer's discretion. |
| Whether the officer relied on inaccurately framed statements by MBSI | MBSI’s March 26, 2010 letter contained false statements linking MBSI to non-prosecuted events. | Officer narrowed focus to events leading to prosecution and remedial measures; statements not material. | Not material; rational basis supported by remediation evidence. |
| Whether the contracting officer’s scope was rational and based on adequate information | Officer should have considered a broader corruption context and other documents. | Officer’s MAR shows tailored inquiry and consideration of remedial steps; adequate information gathered. | Rational basis shown; no arbitrary or capricious action. |
| Whether injunction should issue given national defense interests | Injunctive relief warranted to prevent unfair procurement and protect national defense. | Public and national defense interests weigh against delay given competitive pricing and remedial actions. | Injunction denied; award to Mabey furthered public interest and defense needs. |
Key Cases Cited
- Domenico Garufi v. United States, 238 F.3d 1324 (Fed. Cir. 2001) (material misrepresentation and rational-basis review guide)
- Grimberg Co. v. United States, 185 F.3d 1297 (Fed. Cir. 1999) (contracting officer's information needs are within wide discretion)
- Bender Shipbuilding & Repair Co. v. United States, 297 F.3d 1358 (Fed. Cir. 2002) (discretion in responsibility determinations)
- Banknote Corp. of Am. v. United States, 365 F.3d 1345 (Fed. Cir. 2004) (best-value and reasonableness in award decisions)
- OSG Product Tankers LLC v. United States, 82 F.3d 570 (Fed. Cl. 2008) (knowledge of rights and contracting officer's information need)
- Watts-Healy Tibbitts AJV v. United States, 82 Fed.Cl. 614 (Fed. Cl. 2008) (court scrutinizes minimal initial review in serious misconduct cases)
- Watts-Healy Tibbitts AJV v. United States, 84 Fed.Cl. 253 (Fed. Cl. 2008) (second review upheld if rational basis exists)
- Domenico Garufi II, 52 Fed.Cl. 421 (Fed. Cl. 2002) (read scope of investigation and control to determine reasonableness)
- Res. Conservation Group, LLC v. United States, 597 F.3d 1238 (Fed. Cir. 2010) (jurisdiction and standard for bid protests under ADRA)
- Camp v. Pitts, 411 U.S. 138 (Supreme Court 1973) (limits on judicial substitution of agency judgment)