Progressive Financial Services, Inc v. United States
132 Fed. Cl. 191
| Fed. Cl. | 2017Background
- Multiple private debt-collection contractors (Plaintiffs and Intervenor-Plaintiffs) filed bid protests challenging the Department of Education’s (ED) awards under Solicitation No. ED-FSA-16-R-0009 after a GAO decision (Gen. Revenue Corp.) found ED’s prior evaluation unreasonable.
- Several related cases and motions for temporary restraining orders / preliminary injunctions were pending before the Court of Federal Claims; the Government moved to dismiss Count VII of one complaint.
- The court held a consolidated argument and invited parties to draft a joint order to preserve the status quo until ED takes corrective action; some parties objected to the draft.
- The court granted the Government’s motion to dismiss Count VII without prejudice.
- The court found Plaintiffs would suffer immediate and irreparable injury if ED allowed awardees to perform or transferred work to other vehicles, and entered a preliminary injunction halting performance and transfers until ED announces corrective action (or until May 22, 2017).
- The injunction rescinded a prior modification that had advantaged certain intervenors and was narrowly tailored to preserve competition and allow a global solution among the cases.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Count VII should survive the Government’s motion to dismiss | Count VII raises viable claims that warrant judicial review | Government moved to dismiss Count VII | Court granted Government’s motion; Count VII dismissed without prejudice |
| Whether plaintiffs will suffer immediate and irreparable harm absent injunctive relief | Allowing awardees to perform or transferring work will irreparably harm plaintiffs’ economic and competitive interests | Government argued motions premature given lack of administrative record and pending corrective action | Court found irreparable harm likely and granted preliminary injunction |
| Likelihood of success on the merits sufficient to support injunctive relief | GAO’s decision showing ED’s unreasonable evaluation supports plaintiffs’ likelihood of success | Government noted absence of administrative record and no briefing on merits yet | Court concluded plaintiffs likely to prevail at least in part, given GAO decision; factor favors injunction |
| Public interest and balance of hardships | Public interest favors fair, open competition; economic harm to plaintiffs outweighs disruption from delay | ED and others would be disrupted by delay in performance | Court found public interest and balance of hardships favor injunction given $2.8 billion at stake |
Key Cases Cited
- U.S. Ass’n of Importers of Textiles & Apparel v. United States, 413 F.3d 1344 (Fed. Cir. 2005) (articulates the four-factor preliminary injunction test used in bid protests)
- FMC Corp. v. United States, 3 F.3d 424 (Fed. Cir. 1993) (one weak injunction factor may be overborne by strength of others)
- Florida Power & Light Co. v. Lorion, 470 U.S. 729 (1985) (judicial review of agency action is based on the administrative record)
- PGBA, LLC v. United States, 57 Fed. Cl. 655 (2003) (public interest in protecting integrity of procurement process supports injunctive relief)