Collection Technology, Inc. v. United States
17-578
| Fed. Cl. | May 2, 2017Background
- Multiple private debt-collection companies filed bid protests challenging the Department of Education’s (ED) awards under Solicitation No. ED-FSA-16-R-0009 after a GAO decision found ED’s evaluation unreasonable.
- Continental Services filed a complaint with multiple counts; the Government moved to dismiss Count VII and sought dismissal at hearing on May 2, 2017.
- Several plaintiffs (including Collection Technology, Pioneer Credit Recovery, Account Control Technology, Progressive Financial, and others) moved for temporary restraining orders and/or preliminary injunctions to stop ED from allowing awardees to perform or transferring work.
- The court held a hearing, invited parties to draft a joint order to preserve the status quo, but objections prevented agreement; the court reviewed motions and arguments.
- The court dismissed Count VII without prejudice and entered a preliminary injunction preventing ED (and its agents) from: (1) authorizing awardees to perform under ED-FSA-16-R-0009; and (2) transferring the contested work to other contracting vehicles to circumvent the protests.
- The injunction rescinded an earlier modification that favored certain intervenors and remains in effect until close of business on May 22, 2017 (or until DOJ/ED files notice of corrective action or parties agree otherwise).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Count VII should be dismissed | Count VII properly states a claim | Government moved to dismiss Count VII | Court granted Government’s motion; Count VII dismissed without prejudice |
| Whether plaintiffs will suffer irreparable harm absent relief | Continued performance or transfer would irreparably harm bidders and prejudice competition | ED argued corrective processes suffice and pending administrative record review needed | Court found immediate and irreparable injury likely and granted injunctive relief |
| Likelihood of success on the merits of protest | GAO decision indicates ED’s evaluation was unreasonable; plaintiffs likely to prevail | Government noted administrative record not yet produced and merits unbriefed | Court found plaintiffs likely to prevail in part based on GAO decision |
| Public interest and balance of harms | Public interest favors fair competition; plaintiffs’ economic harm outweighs delay harms | ED argued delay could disrupt operations and borrowers | Court held public interest and balance of hardships favor injunction to protect procurement integrity |
Key Cases Cited
- U.S. Ass’n of Importers of Textiles & Apparel v. United States, 413 F.3d 1344 (Fed. Cir. 2005) (four-factor preliminary injunction framework)
- FMC Corp. v. United States, 3 F.3d 424 (Fed. Cir. 1993) (weakness on one injunction factor can be overcome by strength on others)
- Florida Power & Light Co. v. Lorion, 470 U.S. 729 (U.S. 1985) (APA review based on agency record)
- PGBA, LLC v. United States, 57 Fed. Cl. 655 (Ct. Fed. Cl. 2003) (public interest supports preserving procurement competition)