Res-Care, Inc. v. United States
107 Fed. Cl. 136
Fed. Cl.2012Background
- This is a pre-solicitation protest challenging DOL's designation of Blue Ridge Job Corps Center's contract as a 100% small business set-aside.
- Res-Care, the incumbent, is not a small business under the relevant NAICS size standards and thus unavailable for award.
- DOL conducted a sources sought process in December 2011, receiving five capabilities statements; four from small businesses.
- On March 9, 2012, DOL designated the contract as a small business set-aside after finding two small businesses capable and a reasonable expectation of award at fair market prices.
- A formal solicitation issued September 11, 2012, with performance beginning April 1, 2013; prior protest and record proceedings occurred.
- Res-Care sought to supplement the administrative record with a second Myers declaration and the Rell & Doran Report; court limited consideration of extra-record materials.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether small business set-asides are permissible under WIA §2887 | Res-Care argues §2887 precludes small business set-asides unless expressly exempted. | DOL and the agency view small business set-asides as compatible with §2887 and consistent with regulations. | Small business set-asides permitted; agency receives deference. |
| Whether the agency properly applied the 'rule of two' under FAR 19.502-2 | Res-Care contends there is substantial evidence that small businesses generally underperform. | Agency relied on the record to find two capable small businesses; general performance is irrelevant to the specific bid. | Agency's finding of two capable small businesses stands. |
| Whether the court should consider extra-record evidence | Res-Care seeks supplementation with Myers declaration and Rell & Doran Report for broader context. | Extra-record materials are inadmissible for this bid protest and should be struck. | Court denies supplementation and strikes references to extra-record materials. |
| Whether the contracting decision complied with federal procurement framework | Res-Care argues WIA and related statutes require a different competitive framework than §3303/3304. | Agency appropriately used §3303(b) to exclude non-small businesses within a competitive framework; CICA and related regulations support this. | Record supports that the set-aside complied with applicable procurement framework; cross-motions resolved accordingly. |
Key Cases Cited
- Nielsen v. Shinseki, 607 F.3d 802 (Fed. Cir. 2010) (statutory interpretation of ambiguous terms; ordinary meaning governs)
- Chevron, U.S.A., Inc. v. Natural Resources Def. Council, Inc., 467 U.S. 837 (U.S. 1984) (agency deference in statutory interpretation)
- Perrin v. United States, 444 U.S. 37 (U.S. 1979) (dictates ordinary-meaning approach when terms are undefined)
- American Federation of Government Employees, AFL-CIO v. United States, 258 F.3d 1294 (Fed. Cir. 2001) (interested party status and procurement standing)