Public Communications Services, Inc. v. Simmons
409 S.W.3d 538
Mo. Ct. App.2013Background
- PCS challenged Missouri's award of the inmate telephone services contract to Securus, alleging improper consideration of optional paid services and a flawed weighing of Securus' per-transaction prepaid-fee.
- RFP allowed optional products and services; bidders could propose them, but the state reserved the right to evaluate them subjectively and was not required to procure them.
- Securus bid at base rate $0.05/min with four optional services at $0.01/min each; PCS bid base $0.07/min with its own optional-service positions; several bidders included optional services in base pricing.
- Evaluation combined objective cost points and a subjective assessment; prepaid-fee setup and optional services were not properly weighted or compared, according to PCS.
- Notice of Award stated Securus’ proposal was accepted in its entirety, but the contract language and surrounding procurement process suggested only mandatory services were subject to the award.
- Trial court found no procurement of optional services and denied PCS relief; PCS appealed claiming arbitrariness, misweighing of prepaid-fee costs, and improper inclusion of optional services.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing of PCS to challenge award | PCS has standing as a disappointed bidder challenging unfair procurement. | Losing bidders generally lack standing to challenge awards. | PCS has standing to challenge the procurement process. |
| Are Securus' optional services incorporated into the contract? | Acceptance of Securus' bid included optional services; award violated competitive bidding. | Optional services were not part of the awarded contract; only mandatory services were binding. | Optional services were not incorporated; contract valid for mandatory services only. |
| Was the award arbitrary or capricious for not evaluating prepaid fees and optional services? | Prepaid transaction fees and optional services should have affected the cost/quality scoring. | RFP allowed subjective evaluation of prepaid fees; no requirement to adjust base cost. | No arbitrary/capricious action; discretionary evaluation upheld. |
| Did failure to weigh Securus' prepaid fees render the award unlawful? | Ignoring high prepaid-fee costs biased the award against PCS. | RFP reserved right to evaluate prepaid fees subjectively; not mandatory in objective cost. | Not unlawful; subjective evaluation permitted and properly applied. |
| Construction of the Notice of Award and contract scope | Notice of Award read as accepting all of Securus' proposal, including optional services. | Read in context with RFP, 'accepted in its entirety' refers to mandatory services only. | Notice of Award interpreted to cover mandatory services; contract not void for optional-items omission. |
Key Cases Cited
- Mo. Nat. Educ. Ass’n v. Mo. State Bd. Of Educ., 34 S.W.3d 266 (Mo.App. W.D.2000) (de novo review of noncontested agency decisions; due-process considerations)
- La Mar Const. Co. v. Holt County, R-II School Dist., 542 S.W.2d 568 (Mo.App.1976) (public standing when procurement is not fairly bid)
- State ex rel. Johnson v. Sevier, 98 S.W.2d 677 (Mo.1956) (bidders’ challenge to lowest and best bidder fairness)
- Mid-Missouri Limestone, Inc. v. County of Callaway, 962 S.W.2d 438 (Mo.App. W.D.1998) (unfair bidding when equal terms not provided to all bidders)
- Metro. Exp. Servs., Inc. v. City of Kansas City, 23 F.3d 1367 (8th Cir.1994) (unsuccessful bidder standing where bidding procedure not equal)