127 Fed. Cl. 539
Fed. Cl.2016Background
- HHS PSC issued an LPTA, small-business set-aside RFQ (Nov 2014) for operational support of UFMS; Starry was incumbent and licensed two proprietary systems (MACCS, GovNet). Three quotes were received; Intellizant was lowest-priced.
- A three-member TEP (Thompson, Slater, Peoples) produced split evaluations: Thompson (unacceptable), Peoples (qualified but with gaps), Slater (acceptable based on prior experience with Intellizant). CO/SSA Cassandra Ellis found Intellizant technically acceptable and awarded the contract (Dec 2014).
- Starry protested to GAO; HHS first said it would ‘‘strengthen’’ documentation, then agreed to reevaluate. A second TEP review again yielded disagreement; SSA reaffirmed award (Apr 2015). Starry filed a second GAO protest.
- GAO sustained in part (Aug 2015), finding the agency failed to evaluate whether Intellizant’s personnel could meet PWS/key-personnel requirements, and recommended reevaluation or termination if appropriate. GAO rejected bias allegations based on HHS representations that John Davis had recused.
- After GAO’s ruling, John Davis (HHS manager with prior Intellizant ties) decided to cancel the solicitation, stating MACCS and GovNet support duplicated separate license agreements; HHS canceled and planned to re-solicit. Starry protested again to GAO (denied) and then sued in the Court of Federal Claims.
- The court conducted limited supplementation (depositions). The court found no contemporaneous analysis supporting the agency’s claim that license agreements duplicated UFMS support; Davis admitted he had not compared documents and license provisions were narrower than UFMS support. The court held the cancellation arbitrary and capricious and enjoined it; certain agency personnel (Ellis, Slater, Davis) were barred from further involvement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether procurement was prejudicially tainted by bias | Davis unduly influenced TEP composition and outcome; cancellation was pretext to benefit Intellizant | Agency argues Davis recused; GAO found bias allegations without merit | Court did not decide bias issue; found other ground dispositive |
| Whether cancellation of the solicitation was rational | Cancellation was pretextual; agency made no meaningful review of needs re: MACCS/GovNet | Cancellation justified because MACCS and GovNet support duplicated separate license agreements | Cancellation was arbitrary and capricious — set aside |
| Whether agency complied with GAO remedial recommendations after second GAO decision | Agency avoided reevaluation and instead cancelled to evade GAO recommendation | Agency claims cancellation was a reasonable alternative to reevaluation | Court found agency failed to document a rational basis; must proceed consistent with GAO and court holdings |
| Appropriate remedy and injunctive relief | Requests reinstatement of procurement posture pre-cancellation and injunctive relief | Government opposes injunction, argues pecuniary harm insufficient and cancellation reasonable | Court granted injunction, set aside cancellation, barred Ellis/Slater/Davis from further involvement |
Key Cases Cited
- Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 (Fed. Cir. 2001) (standard for reviewing procurement decisions: rational basis/violation of procedure)
- Weeks Marine, Inc. v. United States, 575 F.3d 1352 (Fed. Cir. 2009) (deferential standard of review for agency procurement judgments)
- PGBA v. United States, 389 F.3d 1219 (Fed. Cir. 2004) (four‑factor test for injunctive relief in bid protests)
- L-3 Commc’ns, Inc. v. United States, 87 Fed. Cl. 656 (2009) (deference to agency views of its needs)
- Gulf Grp. Inc. v. United States, 61 Fed. Cl. 338 (2004) (agency must examine relevant data and articulate satisfactory explanation)
- AshBritt, Inc. v. United States, 87 Fed. Cl. 344 (2009) (agency action set aside where it failed to undertake or document the required review)