Whr Group, Inc. v. United States
115 Fed. Cl. 386
Fed. Cl.2014Background
- The FBI issued a January 2013 solicitation for relocation services (up to four Blanket Purchase Agreements (BPAs)), evaluated on technical acceptability, price (lowest cost among technically acceptable), and pass/fail past performance; solicitation included a 100% financial-capability self-certification, a 2,000-move annual estimate, and a rotating task-order assignment system.
- The FBI awarded three BPAs (Allegiance/Franconia, Lexicon, WHR) to the three lowest-priced technically acceptable offerors; several other offerors (including Brookfield, CapRelo, TRC) were technically acceptable at higher prices.
- Brookfield filed a GAO protest alleging the FBI failed to meaningfully evaluate the supporting documentation underlying the 100% financial-capability self-certifications; GAO informally predicted Brookfield would prevail and the parties settled: FBI agreed to add a fourth BPA to Brookfield (and contemplated eliminating the 100% requirement if dismissal failed).
- CapRelo and TRC subsequently protested the Brookfield award; the FBI issued internal "notes to file" and announced corrective action: cancel all four BPAs and resolicit under a revised solicitation that would (inter alia) remove the 100% requirement, revise pricing methodology, drop the rotation system (to conform with FAR ordering rules), and reflect a reduced projected demand (≈40% reduction).
- WHR and Lexicon filed suit in the Court of Federal Claims challenging the FBI’s cancellation/resolicitation and seeking permanent injunctive relief to block cancellation, prevent the revised procurement, and stop further non-competitive extensions/use of Brookfield’s task order.
- The Court found the FBI’s stated rationales for wholesale cancellation and resolicitation insufficient and arbitrary: it permanently enjoined the FBI from cancelling the BPAs, conducting a replacement procurement, or extending/using Brookfield’s task order except for a reasonable transition period.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FBI's blanket cancellation/resolicitation was a reasonable corrective action under the APA | Cancellation was arbitrary because defects identified were either non-existent or remediable without resolicitation; plaintiffs would suffer irreparable harm from needless recompetition and exposed pricing | FBI argued multiple defects (100% financial-capability requirement, inadequate evaluation, rotation system conflict with FAR, reduced demand) justified revising the solicitation and resoliciting | Court: Cancellation/resolicitation was arbitrary and unreasonable; FBI failed to articulate record-based rationales tying defects to the chosen corrective action; injunction granted |
| Whether removal of the 100% financial-capability requirement justified resolicitation | Requirement removal does not appear in the record to produce more competition or cost savings; plaintiffs had relied on solicitation terms | FBI claimed removal would lower barriers to entry and alter pricing, justifying new bids | Court: FBI gave only conclusory assertions with no record support; removal cannot rationally support cancellation |
| Whether alleged inadequate review of supporting financial documents justified cancellation | Plaintiffs: FBI’s facial check for contradictions was reasonable and consistent with solicitation; deeper review was unnecessary | FBI: GAO predicted sustainment; evaluation flaw exists because agency didn’t evaluate supporting documentation substantively | Court: Even assuming an evaluation flaw, a targeted remedy (re-evaluate or request limited additional info) — not full resolicitation — was the appropriate response; evaluation issue does not justify cancellation |
| Whether the rotation-based task-order system conflicted with FAR and justified cancellation | Plaintiffs: Solicitation expressly reserved FBI’s right to waive rotation on a case-by-case basis; no irreconcilable conflict shown | FBI: FAR §8.405-3 requires competition for orders over the SAT; rotation could produce orders exceeding the SAT | Court: No clear conflict in the solicitation because waiver language allowed compliance with FAR; potential SAT-triggered issues do not justify cancelling awards |
Key Cases Cited
- Motor Vehicle Mfrs. Ass'n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983) (agency action must show reasoned decisionmaking and a rational connection between facts and choice)
- Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 (Fed. Cir. 2001) (administrative decisions must be supported by reasoned explanation)
- Sheridan Corp. v. United States, 95 Fed. Cl. 141 (2010) (corrective action must target identified defects; wholesale resolicitation for perceived evaluation errors is improper)
- Sierra Nevada Corp. v. United States, 107 Fed. Cl. 735 (2012) (upholding corrective action where record showed broader taint and post-proposal discussions; corrective-action review must be reasonable under circumstances)
- Centech Group, Inc. v. United States, 554 F.3d 1029 (Fed. Cir. 2009) (sets equitable factors for injunctive relief in bid protests)