Coastal Environmental Group, Inc. v. United States
114 Fed. Cl. 124
| Fed. Cl. | 2014Background
- EPA issued an IFB (fixed-price, indefinite-quantity) for remediation of up to 2,600 residential properties in Omaha; award to lowest responsible, responsive small-business bidder. Key-personnel resumes were required and material to responsiveness.
- PK Management was low bidder; contracting officer concluded PK was not responsible based on experience/resumes and referred responsibility to SBA (CO did not address responsiveness). SBA issued a Certificate of Competency (COC) finding PK responsible; CO appealed and lost, and awarded the contract to PK.
- Plaintiff (Coastal Environmental Group) protested at GAO (denied) and then filed this suit in the Court of Federal Claims challenging (1) award to a bidder with a nonresponsive bid and (2) SBA’s responsibility determination without a responsiveness finding; sought injunction, declaratory relief, termination, award to plaintiff, and fees.
- While litigation was pending, EPA terminated PK’s contract for convenience and cancelled the procurement, later deciding to meet needs via existing contracts and a smaller procurement. Defendant moved to dismiss as moot; plaintiff sought leave to amend to challenge the cancellation.
- Court held the original award-based claims moot due to termination and cancellation but granted leave to file a supplemental complaint under RCFC 15(d) to challenge the agency’s cancellation decision, rejecting defendant’s futility and laches arguments at that stage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether original protest challenging award remains justiciable after contract termination and procurement cancellation | The court retains jurisdiction; plaintiff could amend to assert new claims (and fees preserve jurisdiction) | Termination and cancellation render the award challenge moot; fees cannot salvage jurisdiction | Moot: award-related claims dismissed as moot because termination/cancellation prevent meaningful relief |
| Whether plaintiff may supplement/amend complaint to challenge EPA’s cancellation (RCFC 15(d) vs 15(a)) | Plaintiff seeks leave to amend to challenge cancellation and cure jurisdictional defect | Defendant argues supplementation would be futile and barred (e.g., by laches or statutory limits) | Grant: supplementation under RCFC 15(d) allowed; plaintiff may file supplemental complaint alleging cancellation-related claims |
| Whether laches or prejudice bars supplementation | Plaintiff did not delay unreasonably in seeking to supplement; no clear prejudice shown | EPA would be prejudiced by undoing actions and potential duplicative costs from delay | Denied on present record: defendant failed to carry burden to show laches/prejudice; may reassert if supported by evidence |
| Whether successful challenge to cancellation would re-litigate moot award claim | Plaintiff: challenge to cancellation is distinct and would not require revisiting awarded contract termination | Defendant: undoing cancellation would return parties to original, moot dispute over award | Plaintiff correct: court would not need to revive award-to-PK claims because PK’s contract was terminated; futility argument rejected |
Key Cases Cited
- Powell v. McCormack, 395 U.S. 486 (describing mootness as absence of live case or controversy)
- Flast v. Cohen, 392 U.S. 83 (mootness and justiciability principles)
- County of Los Angeles v. Davis, 440 U.S. 625 (voluntary cessation and mootness exception)
- Mathews v. Diaz, 426 U.S. 67 (post-filing events may cure jurisdictional defects by supplemental pleading)
- A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020 (laches standard and burden on defendant)
- Black v. Secretary of HHS, 93 F.3d 781 (Rule 15(d) supplementation can cure defects absent express statutory prohibition)