PER AARSLEFF A/S, Plaintiff, v. UNITED STATES, Defendant, and Exelis Services A/S, Defendant-Intervenor.
Nos. 15-215C, 15-272C, and 15-330C (consolidated)
United States Court of Federal Claims.
May 28, 2015
Reissued: June 5, 2015
121 Fed. Cl. 603
LETTOW, Judge.
James J. McCullough, Fried, Frank, Harris, Shriver & Jacobson LLP, Washington, D.C. for Greenland Contractors I/S, plaintiff in No. 15-272C. With Mr. McCullough on the briefs and at the hearing was Michael J. Anstett, Fried, Frank, Harris, Shriver & Jacobson LLP, Washington, D.C. With him on the briefs were Aaron T. Tucker and Samuel W. Jack, Fried, Frank, Harris, Shriver & Jacobson LLP, Washington, D.C.
Kevin J. Cosgrove, Hunton & Williams LLP, Norfolk, Virginia for Copenhagen Arctic A/S, plaintiff in No. 15-330C.
William P. Rayel, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C., for the United States. With Mr. Rayel on the briefs were Benjamin C. Mizer, Acting Assistant Attorney General, United States Department of Justice, Washington, D.C., Robert E. Kirschman, Jr., Director, and Scott D. Austin, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C.
Kevin P. Connelly, Vedder Price P.C., Washington, D.C. for Exelis Services A/S. With Mr. Connelly on the briefs were Eric J. Marcotte, Marques O. Peterson, Kelly E. Buroker, and Caroline A. Keller, Vedder Price P.C., Washington, D.C.
Consolidated post-award bid protests; limitation on competition due to international agreement;
OPINION AND ORDER1
LETTOW, Judge.
In this tripartite bid protest, plaintiffs Per Aarsleff A/S (“Per Aarsleff”), Greenland Contractors I/S (“Greenland Contractors”), and Copenhagen Arctic A/S (“Copenhagen Arctic”) challenge the decision of the United States Department of the Air Force Space Command (“Air Force” or “government”) to award a contract to Exelis Services A/S (“Exelis Services”) under Request for Proposals (“RFP” or “Solicitation”) No. FA2523-12-R-0006 to operate, maintain, and support Thule Air Base, a United States Air Force Base located in a remote area of northwestern Greenland. Although all four offerors in this Solicitation were rated as technically acceptable by the Air Force, Exelis Services received the contract (“Thule Contract”) based upon the Air Force’s evaluation that it had the lowest-price, technically acceptable proposal.
The protestors previously raised similar claims before the Government Accountability Office (“GAO”), which denied relief in a decision dated February 18, 2015. See Per Aarsleff A/S, B-410782, et al., 2015 CPD ¶ 86, 2015 WL 1004252 (Comp.Gen. Feb. 18, 2015).
Each of the three plaintiffs has submitted motions for judgment on the administrative record pursuant to
FACTS2
A. Thule Air Base
1. Location and environment.
Thule Air Base is sited in an austere area of the world, surrounded by glaciers and North Star Bay. AR 83-4608 (Thule Air Base Acquisition Plan (approved Mar. 3, 2014)).3 Specifically, this northernmost military installation is located in northwestern Greenland, approximately 600 miles north of the Arctic Circle and 900 miles south of the North Pole. AR 20c-668 (Contracting Officer’s Statement of Facts (Dec. 12, 2014)). Due to its position within the Arctic Circle, the ground of the Air Base is permanently frozen to a depth of at least 1,000 feet throughout the year. AR 83-4607. Temperatures are severe, averaging from 0 to -30 degrees Fahrenheit during the winter months and dropping to -75 degrees Fahrenheit with wind chill. Id. While the days are 24 hours long from April through August, there is no sunlight between November and January. Id. The “storm season,” in which Thule Air Base faces the most extreme weather conditions, occurs from September 15 through May 15. Id.
By virtue of its location, Thule Air Base offers strategic military advantages in the Arctic region. Its mission is to “provide early warning and attack assessment of ballistic missile launches, provide space surveillance data and . . . provide tracking, telemetry and command[ ] of earth orbiting
The Defense Area of Thule Air Base is approximately 275 square miles. AR 83-4608. The Defense Area and adjacent land lack paved roads and amenities common on most military installations, such as banks, a commissary, and fast food chains. Id. There is no “downtown” area and the closest village, Qaanaaq (population 700), is located 75 miles away, accessible by helicopter or dog-sled during the winter and by boat during the summer. AR 83-4648. Unlike a majority of bases serving the United States military, all personnel supporting Thule Air Base live within the Thule Defense Area in facilities provided by the United States government. Id. Thule Air Base houses 700 to 900 individuals, with the highest number of staff living on the base during the summer construction season. AR 83-4603.
Given the harsh Arctic environment, profound logistical challenges arise in supplying fuel, materials and non-perishable items to individuals working and living on Thule Air Base. AR 83-4608. The seaport is only available during several summer months; for the remaining months, airlift is the sole type of transportation to and from the base. Id. Thule Air Base has a lengthy runway that is not always fully available. Prelim. Inj. Hr’g Tr. 103:8-23 (Apr. 2, 2015).4 Specifically, large planes will be unable to land at Thule Air Base this summer. Prelim. Inj. Hr’g Tr. 104:3-10.5 Also, flight delays and cancellations are not infrequent during the winter, which can “result[ ] in passengers, cargo (including mission-critical parts and subsistence) being stranded at the originating or en-route airport.” AR 83-4608.
2. Bilateral agreements and understandings.
With the exception of foreign policy and defense, which is within the competence of the Kingdom of Denmark, Greenland is a self-governing entity of the Danish government. AR 834606. Thule Air Base was created pursuant to the 1951 Defense of Greenland Agreement (“1951 Agreement”) between the governments of the United States and Denmark. See AR 83-4765 (Defense of Greenland Agreement, 2 U.S.T. 1485 (signed Apr. 27, 1951 and effective June 8, 1951)). “The 1951 Agreement is the foundational agreement for the presence of the U.S. armed forces in Greenland and was entered into . . . ‘in accordance with the principles of self-help and mutual aid, and having been requested by the North Atlantic Treaty Organization (NATO) to negotiate arrangements under which armed forces of the parties to [NATO] may make use of facilities in Greenland in defense of Greenland and the rest of the North Atlantic Treaty area.’” AR 32-2650 15 (Legal Opinion of Kevin A. Doherty (Jan. 26, 2015)) (citing 1951 Agreement). Under its terms, the Air Force is permitted “rent-free use of the land on which Thule Defense Area is located.” AR 83-4648.
Since the inception of Thule Air Base, the United States and Danish governments have engaged in negotiations regarding contractual opportunities to support the base. See, e.g., AR 20zf-1463 to 1464 (Letter from William Thurman to Air Force Regarding Danish Participation in U.S. Defense Projects in Greenland (Aug. 29, 1962)); see also Def.’s Opp’n to Pls.’ Motions for Prelim. Inj. App. (“Def.’s Opp’n to Pls.’ Mots. for Prelim. Inj.”) App. at 50, ECF No. 41 (Joint Statement of
In 1991, a Memorandum of Understanding between the two countries stated that “either [p]arty may award contracts to commercial enterprises for goods and services, including construction projects, in Greenland and may procure directly from any U.S. or Danish/Greenlandic source . . . .” Memorandum of Understanding Between the Government of the United States of America and the Government of the Kingdom of Denmark (Including the Home Rule Government of Greenland) Use of Sondrestrom Aviation Facility Kulusuk Airfield and Other Matters Related to United States Military Activities in Greenland (“1991 MOU”), art. IV, ¶ 1, Mar. 13, 1991, T.I.A.S. No. 12285. During the years 2008 and 2009, the United States and Danish governments collaborated to amend the 1991 MOU with the following text:
In accordance with their respective laws and regulations, either [p]arty may award contracts to commercial enterprises for goods and services, including construction projects, in Greenland, and shall procure directly from Danish/Greenlandic sources. When procurement from such sources is not feasible, U.S. requirements may be satisfied by procurement from U.S. or other sources. Either [p]arty may use its own military or civilian personnel to perform services or construction projects.
AR 20z-1443 (Diplomatic Note (Jan. 27, 2009)) (emphasis added). The revision stated in the Note replaced Article IV, paragraph one of the 1991 MOU and “constitute[d] an Agreement between [the] two governments,” which entered into force on January 27, 2009. See AR 20z-1443 to 1444; see also AR 147-11598 (Thule Base Maintenance Contract Recommendation) (setting out the State Department’s acknowledgment that it was “bound by the . . . language from our . . . diplomatic note to the Government of Denmark amending the language of Article IV of the March 13, 1991 [MOU] between the United States and Denmark (including Greenland).”).
Consistent with these international agreements, officials from the Air Force and the State Department entered into discussions with Danish Ministry of Finance officials during the Spring of 2013 to determine whether offerors qualified as “Danish/Greenlandic sources” for the purpose of a Thule Air Base solicitation. See AR 20c-673. As the two countries were negotiating the eligibility requirements, the Danish Ministry of Foreign Affairs intimated that it would not make the eligibility determination because of obligations with European Union procurement regulations and it would likely recommend that the government of Greenland step in, since it is not part of the European Union. See AR 147-11587 (E-mail from [* * *] to [* * *], et al. (Nov. 1, 2013)). This recommendation presented a conflict of interest, however, because the incumbent contractor, Greenland Contractors, is partially owned by the government of Greenland. See id.; see also AR 147-11606 (E-mail from Patrick King to [* * *] (Nov. 5, 2013)).
- the primary bidder must be registered as a Danish company with the Danish Business Authority—demonstrated by a CVR number . . . and a listing within the Central Business Registry identifying them within a legal category of Danish businesses (not as a subsidiary of a foreign company);
- payable through a Danish bank account;
- maintaining a physical[ ] presence in the Kingdom of Denmark.
AR 147-11600.7
During this time and in furtherance of its proposal to create a “simple, transparent checklist of requirements,” AR 147-11586, a State Department officer, [* * *], sent an e-mail to the contracting officer, Patrick King, regarding the requirements for conducting business in Denmark, AR 20f-873 (E-mail from [* * *] to [* * *], King, and Major John Schoonmaker (Nov. 4, 2013)). Mr. [* * *] informed Mr. King that “[i]n the searchable part of the CVR there is an information point called ‘type of company/virksomhedsform’ that has ‘subsidiary of foreign company’ as a possibility, so there is a way to see if the company is fully registered as Danish or acting as a foreign subsidiary in Denmark.” Id. (emphasis added).8 Accordingly, the United States government was under the belief, later proved to be mistaken, that registering in the CVR would permit the Air Force to determine whether an offeror was genuinely a Danish or Greenlandic entity or was merely acting as a subsidiary of a foreign company.
On November 25, 2013, the Danish Ministry of Foreign Affairs proposed criteria that would limit eligibility to Greenlandic companies: namely, “the enterprise [must be] registered . . . under the legislation applying to Greenland . . . [, t]he registered office of the enterprise [must] be in Greenland and the management of the [contract] [must] be performed in Greenland . . . [, and] [t]he enterprise [must] abide by the labour laws in Greenland.” AR 147-11632 (Criteria for Greenlandic Enterprise). In response, the State Department indicated that limiting competition to Greenlandic enterprises was a “departure from the status quo and beyond what [it has] committed in [the] MOU with Denmark.” AR 147-11631 (E-mail from [* * *] to [* * *], et al. (Nov. 25, 2013));
During a meeting held on December 2, 2013, the two countries ultimately settled on eligibility criteria to be used in a solicitation for Thule Air Base. See AR 20g-874 (Letter from Kim Jørgensen to the United States Embassy in Copenhagen (Dec. 9, 2013)). The agreed language was memorialized in a letter dated December 9, 2013 from the Danish Ministry of Foreign Affairs to United States Ambassador J. Rufus Gifford. See AR 20g-874 to 875 (“2013 Diplomatic Note”); see also AR 20h-888 (Letter from Gifford to Jørgensen (Dec. 13, 2013)). The 2013 Diplomatic Note acknowledged that the “strong wish of the United States [was] not to further limit the number of companies eligible to participate in the procurement.” AR 20g-874. Accordingly, Danish companies would not be excluded from the competition and it “[would] hence be for the United States to assess whether a company qualifies as Danish or Greenlandic based on predefined criteria.” Id. These criteria required an offeror to produce a signed letter from an officer of a bank within Denmark verifying that the company conducts business with that institution and to submit a corporate certificate verifying that the company is registered as a business in Denmark. AR 20g-874 to 875. The letter expressly stated that “THE ENTERPRISE . . . SHALL NOT BE REGISTERED AS A SUBSIDIARY OF [A] FOREIGN COMPANY.” AR 20g-875 (emphasis in original).
The underlying purpose of the criteria “[wa]s to ensure Greenland and Greenlandic society greatest possible benefits from the agreement.” AR 20g-874; see also Per Aarsleff’s Compl. Attach. D (Decl. of Amb. Jonas Bering Liisberg (“Liisberg Decl.”), ¶ 24 (Mar. 2, 2015)). The Under-Secretary for Legal Affairs in Denmark, Ambassador Liisberg,9 has confirmed the Danish government’s understanding that these eligibility criteria “notif[ied] all interested offerors that the Thule Contract could not be lawfully awarded to a registered Danish company owned and controlled by a foreign company.” Liisberg Decl. ¶ 25 (emphasis added); see also id. ¶ 48 (“The language in the 2013 letters plainly excludes all registered Danish companies that are owned and/or controlled by [a] foreign company. The language serves the purpose of ensuring . . . that eligible companies for the Thule Contract not only have a formal link by registration to Denmark or Greenland, but a real and genuine link, avoiding shell companies owned and controlled by foreign companies.”).
B. Request for Proposals
1. Draft solicitation.
The Air Force issued a draft solicitation in December 2013 that included the eligibility criteria to which Denmark and the United States had agreed. See AR 75-4162 (Draft Solicitation No. FA2523-12-R-0006 (Dec. 5, 2013)); see also AR 8-548 (Decl. of Carlo Mosca (Dec. 14, 2014)) (stating the administrative contracting officer’s acknowledgement that “I do not speak Danish and I am not versed in our treaty obligations under international law. As a result, I determined it was appropriate to rely upon the language provided to [me] by the Danish government for inclusion in the RFP without altering it.”). As set forth in Section L-6 of the draft solicitation, responsive proposals were required to include:
2) Corporation certificate (Selskabscertifikat m. oblat) verifying that your company is registered as a business in the Kingdom of Denmark. (Det Central Virksomhedsregister (CVR); Det Grønlandske Erhervsregister (GER); Skráseting Føroya (Skrás. Nr.))
NOTE: THE REGISTERED OFFICE OF THE ENTERPRISE SHALL BE IN THE KINGDOM OF DENMARK AND SHALL NOT BE REGISTERED AS A SUBSIDIARY OF FOREIGN COMPANY.
3) Signed letter from an officer of a bank within the Kingdom of Denmark verifying that your company conducts business with that institution.
NOTE: ELECTRONIC FUNDS TRANSFER OF INVOICE PAYMENTS WILL ONLY BE MADE TO A BANK IN THE KINGDOM OF DENMARK.
AR 75-4162; see also AR 75-4155 (setting out Section L-3 of the draft solicitation, limiting “participation in this acquisition . . . to Danish/Greenlandic enterprises.”).
Prospective offerors responded with questions to the Air Force regarding the eligibility requirements. On December 10, 2013, the Air Force received the following inquiry: “What do you mean by ‘not be registered’?” AR 20e-826 (Draft RFP Question and Answer (“RFP Q & A”)). Relying solely on the e-mail from an official with the State Department, see supra, at 610, and without taking steps to verify the accuracy of the statement in the e-mail, the Air Force posted an answer stating that “[i]n the searchable part of the CVR there is an information point called ‘type of company/virksomhedsform’ that has ‘subsidiary of foreign company’ as a possibility, so there is a way to see if the company is fully registered as Danish or acting as a foreign subsidiary in Denmark.” See AR 20e-826 (RFP Q & A); see also AR 20c-674. On January 28, 2014, a prospective offeror requested that the Air Force “provide further clarification as to what a ‘Danish Enterprise’ is as will be interpreted by the U.S. Air Force.” AR 20e-827 (RFP Q & A). The Air Force responded that “[t]o be eligible for award, an offeror must present: [the documents set forth in Section L-6 of the draft solicitation].” Id. Finally, on February 13, 2014, Exelis Services’ initial Danish teaming partner, Danbor A/S (“Danbor”), posed the following question:
If the Danish registered company is owned by a foreign company but still can provide following:
- Corporate certificate ver[i]fying that your company is regist[e]red as a business in the Kingdom of Denmark[;]
- Signed letter from an officer of a bank within the [K]ingdom of Denmark verifying that your company conducts business with that institution[; and]
- In the CVR register your company is registered as a A/S (limited company) [;]
Will [that company,] based on above[,] be eligible for award?
AR 271-2873 (Danbor Question and Answer (“Danbor Q & A”) (Feb. 13, 2014)) (emphasis added).10 The Air Force did not answer this inquiry in the affirmative, but instead it again copied the eligibility requirements from Section L-6 of the draft solicitation. See id. Together, these responses show the Air Force’s understanding that the CVR database would permit it to identify companies “acting as a foreign subsidiary in Denmark,” see AR 20e-826 (RFP Q & A), so it could exclude those entities from the procurement. Moreover, the Air Force’s response to Danbor suggests that a “company . . . owned by a foreign company” would not meet the RFP’s requirement even if it was “registered as a [Danish company].” See AR 271-2873 (Danbor Q & A).11
2. Final solicitation.
On March 28, 2014, the Air Force issued RFP No. FA2523-12-R-0006 to obtain operation, support, and maintenance services at Thule Air Base. The services include “supply and purchasing, fuels management, airfield and airport operations, air traffic and transportation management, water port operations, civil engineering operations, vehicle operations and maintenance, fire protection, environmental management, health services, food services, recreation and community services, and non-sensitive communication management.” AR 88-5143. The statutory authority for the Solicitation included
The RFP sought a hybrid firm-fixed-price contract, comprising economic-price-adjustment and cost-reimbursable contract line items to be awarded on a low-price, technically acceptable (“LPTA”) basis, as governed by FAR Part 15, Contracting by Negotiation. See AR 88-5143, 5251; see also FAR §§ 15.000-.609. Regarding technical acceptability, the RFP provided that an offeror was required to be acceptable under the following seven technical sub-factors: (1) program management; (2) infrastructure operation and maintenance plan; (3) logistics plan; (4) vehicle/equipment replacement plan; (5) resource utilization plan; (6) downward pricing; and (7) experience. AR 88-5256 to 5258. An unacceptable rating under any one of the sub-factors would result in an offeror’s proposal being rated technically unacceptable. See AR 88-5261 to 5262. The RFP further stated that an offeror’s proposed price had to be “reasonable, affordable[,] and balanced,” pursuant to the price-analysis techniques outlined in FAR § 15.404-1. AR 88-5265; see also FAR § 15.404-1 (titled “Proposal analysis techniques”). In Section M of the RFP, offerors were also “advised to clearly show justification for unique practices that significantly lower pricing.” AR 88-5265 (emphasis added). They were warned that “[a]n assessment that the proposal is not reasonable or affordable w[ould] result in the offer being unacceptable for award.” Id.
The eligibility criteria remained the same as those requirements recited in the draft solicitation:
L-3. OFFEROR ELIGIBILITY
Participation in this acquisition is limited to Danish/Greenlandic enterprises. Enter-
prises must possess a corporation certificate (Selskabscertifikat m. oblat) verifying the company is registered as a business in the Kingdom of Denmark (Det Central Virksomhedsregister (CVR); Det Grønlandske Erhervsregister (GER); Skráseting Føroya (Skrás. Nr.)). NOTE: THE REGISTERED OFFICE OF THE ENTERPRISE SHALL BE IN THE KINGDOM OF DENMARK AND SHALL NOT BE REGISTERED AS A SUBSIDIARY OF FOREIGN COMPANY. Enterprises must produce a signed letter from an officer of a bank within the Kingdom of Denmark verifying the company conducts business with that institution. NOTE: ELECTRONIC FUNDS TRANSFER OF INVOICE PAYMENTS WILL ONLY BE MADE TO A BANK IN THE KINGDOM OF DENMARK.
AR 88-5252 to 5253 (emphasis in original). Those criteria were restated in Section L-6 of the RFP, which provided:
L-6. INFORMATION TO OFFERORS (ITO) AND INSTRUCTIONS FOR PROPOSAL PREPARATION . . . (IPP)
b. Contract Documents. As part of the proposal submission, include the following . . .
2) Corporation certificate (Selskabscertifikat m. oblat) verifying that your company is registered as a business in the Kingdom of Denmark. (Det Central Virksomhedsregister (CVR); Det Grønlandske Erhervsregister (GER); Skráseting Føroya (Skrás. Nr.))
NOTE: THE REGISTERED OFFICE OF THE ENTERPRISE SHALL BE IN THE KINGDOM OF DENMARK AND SHALL NOT BE REGISTERED AS A SUBSIDIARY OF FOREIGN COMPANY.
2) Signed letter from an officer of a bank within the Kingdom of Denmark verifying that your company conducts business with that institution.
NOTE: ELECTRONIC FUNDS TRANSFER OF INVOICE PAYMENTS WILL ONLY BE MADE TO A BANK IN THE KINGDOM OF DENMARK.
AR 88-5253, 5259 (emphasis in original). Also, Section L of the Solicitation included a provision governing staffing. There, the Solicitation explained that in accordance with agreements between the United States and the Kingdom of Denmark, “personnel working at Thule [Air Base] must be Danish, Greenlandic or American citizens, and must adhere to Danish/Greenlandic labor law.” AR 88-5257.
Of further relevance in this bid protest, a provision of the Performance Work Statement (“PWS”) was incorporated in Section H-6 of the Solicitation, which read as follows:
H-6. STATUTORY RESTRICTIONS ON FOREIGN ACQUISITIONS
The requirements at PWS 3.1.16 to maximize and document contract related purchases and subcontracts for Danish and Greenlandic sources required by the 1962 International Agreement (Aide Memoire) between the U.S. and Denmark take precedence in the performance of this contract. Products not acquired by Danish and/or Greenlandic sources must be procured [in accordance with] the following FAR/[Defense Federal Acquisition Regulation Supplement (‘DFARS’)] clauses if applicable:
Procurement of Biobased Products shall utilize
FAR CLAUSE 52.223-2 . The Contractor shall notify the Contracting Officer when purchase of Biobased products cannot be acquired from U.S. sources as and when needed in a satisfactory quality and sufficient quantity at market prices and take action in accordance with the Contracting Officer’s direction.The Contractor agrees to deliver to the Government items that comply with the requirements of [DFARS] clauses 252.225-7012, and 252.225-7030 in Section I of this contract.
Delivery is defined as transfer of title from the contractor to the Government or incorporation of Contractor-owned material or parts into Government-owned property.
AR 88-5227 to 5228 (emphasis in original); see also AR 88-5279 (setting out PWS 3.1.16, as incorporated into Section H of the RFP, requiring a contractor to “[m]aximize and document contract-related purchases and subcontracts from Danish and Greenlandic
C. Evaluation of Offers
1. Offerors.
Four offerors—Exelis Services, Per Aarsleff, Greenland Contractors, and Copenhagen Arctic—submitted timely proposals in response to the Solicitation. See AR 20u-1419 (Source Selection Decision Document (Oct. 21, 2014)). Greenland Contractors is registered as a Danish partnership, i.e., an “Interessentskab” or “I/S,” and is owned in part by the government of Greenland. See Prelim. Inj. Hr’g Tr. 61:13-16. Greenland Contractors is the current contractor for Thule Air Base operation and maintenance, and it has been the incumbent contractor for the base since 1972. Greenland Contractors’ Compl. ¶ 10. Each of the other offerors, Per Aarsleff, Copenhagen Arctic, and Exelis Services, is registered as a Danish limited company, i.e., an “Aktieselskab” or “A/S.” See AR 20s-1280 (Legal Registration Certificate for Exelis Services (Apr. 29, 2014)); see also AR 20zh-1525 (Mem. from René Streander to King (May 11, 2014)); see also Def.’s Opp’n to Mots. for Prelim. Inj. at 13. Exelis Services was established in Denmark in April 2014, Copenhagen Arctic was established in March 2014, and Per Aarsleff was established in December 1961. AR 20zh-1525.15 For the purposes of this procurement, Per Aarsleff listed an American company, [* * *], as a subcontractor, see AR 98-6449 to 6450 (Mem. to King Regarding Contracting Squadron (May 11, 2014)), and Copenhagen Arctic’s proposal included the United States-based entity, [* * *], AR 168-14312, 14319 (Presentation of Copenhagen Arctic and Partners).
Although a Danish-registered enterprise, Exelis Services is a wholly-owned subsidiary of Vectrus Systems Corporation (formerly known as Exelis Systems Corporation) (“Vectrus”), a United States-based company. See Rule 7.1 Disclosure Statement of Def.-Intervenor Exelis Services, ECF No. 20 (No. 15-215) (certifying that “Vectrus Systems Corporation is Exelis Services A/S’ sole corporate parent, owning 100% of its stock”); see also AR 251-28526 (Notice of Award (Oct. 31, 2014)) (“On October 31, 2014, a Danish company owned by Vectrus was awarded a $411M base maintenance contract.... Work will be performed at Thule Air Base, Greenland and is expected to be complete by September 30, 2022.”).16 In addition, the
2. Evaluations.
All four proposals were initially evaluated as technically unacceptable in varying degrees due to defects related to technical sub-factors, but each was nevertheless included in the competitive range. See AR 103-6903-16 (Initial Evaluation Report (June 3, 2014)). The Air Force issued 85 Evaluation Notices (“ENs”) to Copenhagen Arctic, 83 ENs to Exelis Services, 82 ENs to Per Aarsleff, and 54 ENs to Greenland Contractors, AR 20c-677; see also AR 20i-912 (Overall Evaluation Summary), and undertook oral discussions with all four offerors “to ensure complete understanding of the evaluator’s concerns,” AR 20c-677; see also AR 20k-1050 to 1057 (Letters Initiating Discussions with Offerors (June 13, 2014)). As a result of discussions, the Air Force found Greenland Contractors’ proposal to be technically acceptable, while the other three proposals remained technically unacceptable. See AR 20m-1161 (Evaluation Summary after Discussions (July 2014)). Thereafter, the Air Force held a second round of discussions, after which it found all four proposals to be technically acceptable. See AR 20c-677 to 678. The Air Force then requested Final Proposal Revisions. AR 20c-678.
During the evaluation stage of the procurement, an Air Force contract specialist contacted the Danish Ministry of Foreign Affairs for assistance in determining whether the four offerors “[could] be considered Danish Firms and not a subsidiary of a foreign firm.” AR 20g-878 to 879 (E-mail from Streander to Ulrik Petersen (July 30, 2014)). The Danish Ministry of Foreign Affairs declined to “assist [the Air Force] in the assessment of the companies in question,” stating that the purpose of the agreed-upon criteria was to “simplify and streamline the procedure” for determining eligibility and for the United States to determine eligibility based upon “concrete, prior defined criteria[ ].” AR 20g-878 (E-mail from Petersen to Streander (July 30, 2014)).17 The Air Force subsequently sought assistance in this matter from the Danish Business Authority, whose response illuminates the salient issue in this case.18 In an e-mail dated August 6, 2014, the Danish Business Authority wrote, in pertinent part:
Attached please find four CVR reports/certificates on four companies that are all understood to be Danish companies.
Are you permitted to or are you able to help by confirming that they are in actual fact considered to be Danish companies and not subsidiaries of foreign companies?
I do not have experience enough to judge this and need your help. It does look as if they are autonomous Danish companies.
Following efforts by the Air Force to have Danish authorities provide guidance on the eligibility criteria, all four offerors submitted Final Proposal Revisions by September 17, 2014. AR 20c-678. To “ensure[ ] all offerors were still eligible for award . . . [the] CVR was checked to verify that all [o]fferors were registered as a business in the Kingdom of Denmark,” and it was found that “[a]ll [o]fferors . . . had offices that were legally registered as a business in the Kingdom of Denmark.” Id. Not surprisingly, “[t]here was no information [in the CVR] indicating that any offeror . . . had offices registered as subsidiaries of a foreign company.” Id. (emphasis added).20 The Air Force ultimately concluded that all four offerors were eligible for the contract award as Danish or Greenlandic enterprises and that all proposals were technically acceptable.
3. Award.
Exelis Services submitted the lowest-priced proposal, offering to perform the work for 2,020,333,220 Danish kroners (code, “DKK,” symbol, “kr”) ($363,925,645), and it received the award. AR 20c-678 to 679.21 Per Aarsleff proposed the second-lowest price of DKK [* * *] ($[* * *]), Copenhagen Arctic proposed the third-lowest price of DKK [* * *] ($[* * *]), and Greenland Contractors proposed the fourth-lowest price of DKK [* * *] ($[* * *]). AR 20c-678.22 The three unsuccessful bidders were notified of the award decision on October 31, 2014, and post-award debriefings were held on November 6 and 7, 2014. AR 20c-679.
Upon receiving the Thule Contract, Exelis Services immediately began the eight-month process of transitioning, or “phasing-in,” its responsibilities at Thule Air Base. See AR 88-5153, 5217; see also Prelim. Inj. Hr’g Tr. 106:10 to 107:10. Exelis Services maintains that after transition of the Thule Contract, it will “[* * *].” See Exelis Services’ Cross-Mot. at 22 (citing Exelis Services A/S’ Opp’n to Pls.’ Per Aarsleff
4. Danish reaction.
In response to the award of the Thule Contract to a foreign subsidiary, the Danish government expressed “concerns relating to the interpretation of international agreements between the two governments pertaining to the definition of a Danish/Greenlandic enterprise.” Def.’s Opp’n to Pls.’ Mots. for Prelim. Inj. App. at 50; see also Liisberg Decl. ¶ 48. Given the diplomatic tension created by the award to Exelis Services, the United States government recently negotiated a framework with the Danish government, reflected in the Joint Statement issued in March 2015:
The United States and the Kingdom of Denmark are endeavoring to address the concerns [regarding the award of the Thule Contract] as follows:
- The United States and the Kingdom of Denmark have established an expert working group to develop a mutually acceptable definition of a Danish/Greenlandic enterprise.
- The U.S. Air Force intends to conduct a new acquisition and issue a new request for proposals for the Thule Air Base Maintenance Contract once there is agreement between the United States and the Kingdom of Denmark regarding what constitutes a Danish/Greenlandic enterprise.
- The U.S. Air Force intends then to competitively award a Thule Air Base Maintenance Contract. The United States and the Kingdom of Denmark will determine to what degree, if any, competition will be limited.
Def.’s Opp’n to Pls.’ Mots. for Prelim. Inj. App. at 50 (emphasis added). The contemplation of a re-competition in the procurement provides salient evidence that the Air Force committed a fundamental error in awarding the Thule Contract to Exelis Services. The government nonetheless emphasizes that “this [J]oint [S]tatement is not corrective action and does not render these cases moot.” Def.’s Opp’n to Pls.’ Mots. for Prelim. Inj. at 58 n.24.
D. Protests at GAO
In November 2014, Per Aarsleff, Copenhagen Arctic, and Greenland Contractors filed separate protests at GAO challenging the award to Exelis Services.24 Although these
GAO disagreed, holding that “the Air Force reasonably evaluated Exelis Services’ proposal, and reasonably found that Exelis Services was eligible for award under the terms of the solicitation.” Per Aarsleff A/S, 2015 WL 1004252, at *9. GAO explained that the issue turned wholly on registration as a subsidiary, not whether the awardee actually was owned by a foreign, not Danish, parent:
[T]he RFP was clear on its face as to the issue of registration in the CVR. Specifically, we agree with the Air Force and Exelis Services that the RFP’s eligibility analysis addressed whether the offeror was registered as a subsidiary of a foreign company. Apart from the RFP’s language concerning registration, there are no other criteria in the RFP that explain how the agency would evaluate whether a firm was a Danish or Greenlandic enterprise. Although the parties seek to add the issue of ownership or control to the RFP, nothing in the solicitation provides for consideration of these criteria.
Id., at *8 (emphasis added). Even if the language in the Solicitation created doubt as to how the agency was planning to interpret the registration requirement, GAO concluded that any doubt was clarified by the Air Force’s Q & A regarding the meaning of that criterion. See id. (“[The agency’s] response clearly advised offerors that the Air Force believed that there was within the CVR a place for a firm to indicate that a firm was a subsidiary of a foreign firm.”). Furthermore, GAO found that to the extent there was any ambiguity in the language of the Solicitation, it was patent and the protests were therefore untimely. See id., at *9 (“Where a patent ambiguity in a solicitation is not challenged prior to the submission of bids, we will dismiss as untimely any subsequent challenge to the meaning of the solicitation term.”) (citing
GAO also rejected several other protest grounds asserted by the parties, including a challenge by Greenland Contractors regarding the Air Force’s price evaluation. See Per Aarsleff A/S, 2015 WL 1004252, at *13. Greenland Contractors had argued “that the Air Force failed to evaluate whether Exelis Services’ proposed price was too low, and also argue[d] that the awardee’s low price demonstrates that the awardee will not comply with Danish and Greenlandic labor law, as required by the RFP.” Id. GAO found no merit in this argument because it “conclude[d] that the solicitation did not require the Air Force to conduct a price realism evaluation.” Id., at *14. Although the price evaluation required offerors to “show justification for unique practices that significantly lower pricing,”
Following the decision by GAO, the stay under CICA was lifted, and Exelis Services resumed its phase-in activities pursuant to the Thule Contract. See Prelim. Inj. Hr’g Tr. 100:1021, 103:1 to 107:6.
E. Protests in this Court
Per Aarsleff, Greenland Contractors, and Copenhagen Arctic filed separate suits in this court challenging the Air Force’s award of the Thule Contract to Exelis Services. See Per Aarsleff’s Compl. in No. 15-215C ¶ 18; Greenland Contractors’ Compl. in No. 15-272 ¶ 18; Copenhagen Arctic’s Compl. in No. 15-330 ¶ 11. Per Aarsleff filed the first complaint on March 3, 2015, and the next day the court granted a motion by Exelis Services to intervene. Order of Mar. 4, 2015, ECF No. 12. The court set an accelerated briefing schedule to culminate in a hearing scheduled for mid-May. See Scheduling Order of Mar. 4, 2015, ECF No. 13 (No. 15-215). Per Aarsleff subsequently filed a motion for preliminary injunction on March 11, 2015, see Per Aarsleff’s Mot. for Prelim. Inj., ECF No. 23,26 and Greenland Contractors followed with its complaint and a motion for preliminary injunction on March 17, 2015, see Greenland Contractors’ Motion for Prelim. Inj., ECF No. 6 (No. 15-272). The cases were consolidated, see Order of Mar. 20, 2015, ECF No. 19, and the court set a date for a hearing on the motions for a preliminary injunction, see
Briefing on the motions for judgment on the administrative record has proceeded on an accelerated basis. The administrative record was submitted and supplemented twice,28 cross-motions for judgment on the administrative record were received, briefing was completed on May 19, 2015, and a hearing on the merits was held on May 22, 2015. Given the importance of the contract at issue, the expedited schedule has allowed the court to reach a resolution of this bid protest very promptly.
A. 28 U.S.C. § 1491(b)(1)
As an initial matter, this court has jurisdiction over bid protests pursuant to the Tucker Act,
render judgment on an action by an interested party objecting to a solicitation by a [f]ederal agency for bids or proposals for a proposed contract or to a proposed award or the award of a contract or any alleged violation of statute or regulation in connection with a procurement or a proposed procurement.
B. The “Treaty Bar”
The government challenges this court’s subject matter jurisdiction, arguing that
Except as otherwise provided by Act of Congress, the United States Court of Federal Claims shall not have jurisdiction of any claim against the United States growing out of or dependent upon any treaty entered into with foreign nations.
The Court of Claims has interpreted the term “treaty” to include “international executive agreements,” Hughes Aircraft Co. v. United States, 534 F.2d 889, 903 n.17 (Ct.Cl.1976), and that interpretation is binding upon this court.29 “The reason for this [interpretation] is that the fundamental separation-of-powers policy underlying [§] 1502, i.e., to avoid undue judicial interference (e.g., by construction of particular treaty terms and
The government contends that because plaintiffs’ allegations are dependent on an international executive agreement, i.e., the 1951 Defense of Greenland Agreement and the 1991 MOU (as amended by the 2009 Diplomatic Note), this court is divested of jurisdiction under
Assuming that the amendment to the 1991 MOU forms an “international executive agreement” or “treaty,” it is nonetheless appropriate to hear plaintiffs’ claims in these bid protests because these claims neither directly nor proximately stem from an international agreement. See Weld, 127 U.S. at 57, 8 S.Ct. 1000 (“[T]he statute contemplates a direct and proximate connection between the treaty and the claim.”). Contrary to the government’s argument, the court exercises its juridical power to construe the provisions in the Solicitation that were explicitly drafted to satisfy and incorporate the international understanding. In this endeavor, the court will look to the underlying agreements as a guide to interpreting the text of the Solicitation. See Dalles Irrigation Dist. v. United States, 71 Fed.Cl. 344, 354 n. 11 (2006) (“Because this is a situation where the contract was entered to satisfy a statutory requirement . . . the interpretation of the contract must be guided by an examination of the underlying statute.”); see also Roedler v. Department of Energy, 255 F.3d 1347, 1352 (Fed.Cir.2001) (“For determination of contractual and beneficial intent when, as here, the contract implements a statutory enactment, it is appropriate to inquire into the governing statute and its purpose.”) (citing Rendleman v. Bowen, 860 F.2d 1537, 1541-42 (9th Cir.1988); American Hosp. Ass’n v. Schweiker, 721 F.2d 170, 183 (7th Cir.1983); Busby School of Northern Cheyenne Tribe v. United States, 8 Cl.Ct. 596, 602 (1985)). The court will not, however, be directly enforcing the terms of the bilateral agreement between the United States and Denmark. See Hughes Aircraft, 534 F.2d at 906 (“[W]e find plaintiff’s claim no more directly or proximately intertwined with the 1970 MOU than was the escrow agreement with the Byrnes-Blum treaty in Societe Anonyme, the Court of Commissioners Act with the Alabama Claims Treaty in Weld, or the taking claim with the Italian Peace Treaty in Fratelli. Accordingly, we conclude that § 1502 presents no bar to our exercise of jurisdiction in this case.”) (emphasis added) (referring to Weld, 127 U.S. at 57, 8 S.Ct. 1000; S.N.T. Fratelli Gondrand, 166 Ct.Cl. at 478; and Societe Anonyme Des Ateliers Brillie Freres v. United States, 160 Ct.Cl. 192, 196-99 (1963)).
This court therefore has the juridical power to hear plaintiffs’ claims, which neither seek relief based upon a treaty nor the enforcement of a treaty provision subject to
C. Standing
Only an “interested party” has standing to challenge the award of a contract in a bid protest. See
Exelis Services argues that Greenland Contractors, as the highest-priced offeror in the procurement, lacks standing to pursue this protest. Exelis Services’ Cross-Mot. at 56-57. Exelis Services contends that “Greenland Contractors cannot establish standing with respect to the eligibility of Exelis Services, unless and until it has established that: (1) the Agency‘s price evaluation was flawed[;] and (2) it was prejudiced by that flawed evaluation,” id. at 57, and even then, “Copenhagen Arctic would be next in line,” id. at 25 n. 10. Further, Exelis Services avers that Greenland Contractors “cannot establish the requisite prejudice, which defeats its ability to succeed on the merits.” Id. at 25.30
These arguments are not persuasive. Greenland Contractors has plausibly alleged that the Air Force committed errors by failing to adhere to various criteria set forth in the RFP and by engaging in misleading discussions regarding pricing. See Greenland Contractors’ Mot. at 5-6 (“[A]bsent the Air Force‘s eligibility and technical acceptability errors, Greenland Contractors would have been the only technically acceptable offeror. Moreover, the Air Force‘s flawed pricing evaluation left Greenland Contractors’ unreasonably high prices uncorrected and allowed the three lower-priced offerors to propose unjustified lower pricing.“). Contrary to Exelis Services’ position, if the court finds Greenland Contractors’ protest grounds to be persuasive, it would have a substantial chance to receive the award because the offers submitted by the other bidders would have been found to be flawed. See Hyperion, Inc. v. United States, 115 Fed.Cl. 541, 550 (2014) (holding that the fourth-lowest bidder in a LPTA procurement had been sufficiently prejudiced to satisfy the requirement of standing, in a circumstance where the three lower offerors each failed to comply with applicable limitations on subcontracting). Exelis Services’ arguments to the contrary concern the merits of Greenland Contractors’ contentions, and are addressed infra.
In sum, Greenland Contractors has standing to pursue this protest.31
STANDARDS FOR DECISION
The Administrative Procedure Act (“APA“),
Under these standards, the court may set aside a procurement decision where “(1) the procurement official‘s decision lacked a rational basis; or (2) the procurement procedure involved a violation of regulation or procedure.” Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1332 (Fed.Cir.2001). An agency‘s determination lacks a rational basis if the contracting officer “failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or [the result] is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.” Keeton Corrs., 59 Fed.Cl. at 755 (quoting Motor Vehicle Mfrs. Ass‘n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983)). “[T]he disappointed bidder bears a heavy burden of showing that the award decision had no rational basis.” Centech Grp., 554 F.3d at 1037 (internal citations and quotation marks omitted). In challenging an agency action on the second ground, the disappointed bidder must establish “a clear and prejudicial violation of applicable statutes or regulations.” Impresa Construzioni, 238 F.3d at 1333 (quoting Kentron Hawaii, Ltd. v. Warner, 480 F.2d 1166, 1169 (D.C.Cir.1973)).
ANALYSIS
A. Eligibility
1. The terms of the Solicitation.
As previously emphasized, the Solicitation specified that “[p]articipation in this acquisition is limited to Danish/Greenlandic enterprises.” AR 88-5252. The primary dispute in this litigation turns on what was meant by Danish-Greenlandic enterprises and specifically on the meaning and interpretation of the phrase, “THE ENTERPRISE SHALL NOT BE REGISTERED AS A SUBSIDIARY OF [A] FOREIGN COMPANY,” found in Sections L-3 and L-6 of the Solicitation. See AR 88-5252, 5259 (emphasis in original). This restrictive phrase focuses on an enterprise organized as a company rather than under a different economic and organizational structure, e.g., as a partnership, sole proprietorship, association, joint venture, or cooperative. That focus is perhaps understandable from a practical perspective, because the procuring authority would expect that the corporate form would be employed by enterprises large enough to compete for a contract as substantial as the one at hand. In all events, Danish corporate law is at issue.
The government insists that the eligibility restriction concerned the issue of registration and that its intent was to ensure that offerors were fully “registered as Danish” by excluding entities specifically “registered as a subsidiary of a foreign company.” See Def.‘s Cross-Mot. at 17-26; see also Exelis Services’ Cross-Mot. at 31-34. The plaintiffs disagree, arguing that the restrictive language of Section L should be interpreted as being about foreign ownership rather than registration. See, e.g., Per Aarsleff‘s Mot. at 11-17. Under plaintiffs’ interpretation, any subsidiary of a foreign company would not qualify as an eligible Danish or Greenlandic enterprise under the RFP. See, e.g., Greenland Contractors’ Mot. at 8-11.
Pursuant to the canons of contract interpretation, this court “must consider the solicitation as a whole, interpreting it in a manner that harmonizes and gives reasonable meaning to all of its provisions.” Banknote Corp. of Am. v. United States, 365 F.3d 1345, 1353 (Fed.Cir.2004); see also Dalton v. Cessna Aircraft Co., 98 F.3d 1298, 1305 (Fed.Cir.1996) (“We read the language of a particular contractual provision in the context of the entire agreement and construe the con-
The government‘s construction violates these fundamental tenets of contract interpretation. Because it was not possible to register a company in Denmark as a subsidiary of a foreign company during the time of the procurement, the government‘s interpretation eviscerates any significant meaning from the eligibility criterion and renders the restriction illusory. Cf. United States v. Seckinger, 397 U.S. 203, 213-14, 90 S.Ct. 880, 25 L.Ed.2d 224 (1970) (“The view adopted by the Court of Appeals ... would drain this clause [of the contract] of any significant meaning.“). As the government and Exelis Services would have it, foreign entities could create Danish subsidiaries prior to submission of a proposal and then qualify for an award. Under their interpretation, the restriction set forth in Section L-3 that limited participation to “Danish/Greenlandic enterprises” could easily be circumvented and converted into a formalistic non-substantive criterion that would not serve to fulfill the executive agreements between the United States and Denmark regarding Greenland. See AR 88-5252 to 5253. The government maintains its interpretation even though early in this litigation it “acknowledge[d] that the Air Force‘s explanation in the December 2013 question and answer was incorrect and there is not, in fact, a way to register as a ‘subsidiary of foreign company’ in the CVR.” Def.‘s Opp‘n to Pls.’ Mots. for a Prelim. Inj. at 29; see also Def.‘s Cross-Mot. at 29 (“[T]here is not, in fact, a way to register as a ‘subsidiary of [a] foreign company.’ “). The court will not sanction such an unreasonable outcome. See Perry & Wallis, Inc. v. United States, 427 F.2d 722, 726 (Ct.Cl.1970) (“[I]f plaintiff‘s interpretation of the contract is followed literally, it could lead to extremely unreasonable results.... Any interpretation of the contract that would sanction such a result would be patently unreasonable.“).
Some recasting of the language in the Solicitation is necessary due to the defect in the eligibility criteria stated in Sections L-3 and L-6. In that respect, the court strongly prefers to excise the mistaken words, preserving the remainder of the text and comporting with the evident intent of the procuring agency to implement the pertinent bilateral agreements. Cf. Hibbs v. Winn, 542 U.S. 88, 89, 124 S.Ct. 2276, 159 L.Ed.2d 172 (2004) (discussing the cardinal rule against superfluities); see also NVT Techs., 370 F.3d at 1159. Exelis Services provides a list of hypothetical circumstances in which a Danish entity would or would not be eligible for award under plaintiffs’ interpretation. See Exelis Services’ Cross-Mot. at 35-36. For example, “a registered Danish company (A/S) which is owned in its entirety by an individual citizen of any foreign country” would be eligible for award, but “[a] registered Danish company (A/S) whose parent is a corporation of a European Union Member” would be ineligible. Id.; see also Def.‘s Cross-Mot. at 20-21. Any “shortcoming” along these lines is not germane to this bid protest; the underlying executive agreements focus on Danish and Greenlandic sources, not those of the European Union generally. The government also argues that “read[ing] the words ‘registered as’ completely out of the provision ... [v]iolates the ‘cardinal principle of construction of contracts that ... every word in [a contract], will, if possible, be given effect.‘” Def.‘s Cross-Mot. at 20 (citing AMP Inc. v. United States, 389 F.2d 448, 454 (Ct.Cl. 1968)). In making this argument, the government ignores the fact that it was never possible to register as a foreign subsidiary and that its interpretation overlooks the remaining words of the disputed provision, thus disavowing the same legal axiom upon which it relies.32
While creative, this argument is untethered to the administrative record before the court. See Combined Reply of Greenland Contractors I/S in Support of Its Mot. For Judgment on the Admin. Record and in Opp‘n to Def.‘s and Intervenor‘s Cross-Mots. (“Greenland Contractors’ Reply“) at 6 n.3, ECF No. 69. First, Exelis Services’ argument contradicts the position of the Air Force during the protests before GAO. See Copenhagen Arctic‘s Reply at 3. There, the Air Force was asked in a set of interrogatories to “respond to the point raised by the protester that the agency used ‘branches’ and ‘subsidiaries’ as if they were synonyms.” AR 256-28560 (Agency‘s Answers to Interrogatories). The Air Force responded that “[it] reasonably used the term ‘subsidiary’ as a result of its international legal obligations” and stated that “[it] did not use the term ‘subsidiary’ by mistake.” Id. (emphasis added). Second, irrespective of whether Mr. [* * *] mistranslated “branch” for “subsidiary,” see AR 20f-873, the United States Ambassador and the Danish Ministry of Finance negotiated the 2013 Diplomatic Note (written in English) to expressly include the word “subsidiary,” see AR 20g-875. Absent from the negotiated criteria in the 2013 Diplomatic Note were any references to a “branch.” See AR 20g-874 to 875. Finally, the word “subsidiary” was also repeated several times by the contracting officer during the RFP Q & A, as well as by Air Force personnel during the evaluation. See supra, at 612, 616. Based on this evidence, the Solicitation prohibited foreign subsidiaries, not foreign branches. Exelis Services’ argument is not persuasive.
Mindful of the bilateral agreements and understandings between the United States and Danish government and in light of the foregoing, the only reasonable interpretation of the phrase, “SHALL NOT BE REGISTERED AS A SUBSIDIARY OF [A] FOREIGN COMPANY,” is that Danish subsidiaries of foreign entities did not qualify as eligible “Danish/Greenlandic enterprises.” See AR 88-5252 to 5253, 5257 (emphasis in original). Company registration was used mistakenly as a means to ensure genuine Danish or Greenlandic ownership and control. Given that some recasting must be done to take account of this fault, the court‘s reading accords a reasonable meaning to all parts of Sections L-3 and L-6, except for the mistaken words “registered as.” See Banknote Corp. of Am., 365 F.3d at 1353; see also Fortec Constructors, 760 F.2d at 1292.
2. Defect and waiver.
Relying on Blue & Gold Fleet, 492 F.3d 1308, the government argues that plaintiffs should have realized there was a patent defect in the eligibility criterion and that their failure to raise the issue before the close of the bidding process constitutes a waiver barring their reliance on the defect as the basis for a protest in this court. See Def.‘s Cross-Mot. at 26-34; see also Exelis Services’ Cross-Mot. at 40-49. Plaintiffs resist this contention by arguing that the mistake concerning registration constituted a latent error that should be construed against the Air Force, i.e., the drafter of the Solicitation. See Per Aarsleff‘s Mot. at 18-23; see also Greenland Contractors’ Mot. at 16-17; Copenhagen Arctic‘s Mot. at 16-18. The court accordingly must address whether the defect in the Solicitation was latent or patent. See E.L. Hamm & Assocs., Inc. v. England, 379 F.3d 1334, 1342 (Fed.Cir.2004) (“Just as a contractor may recover for a latent ambi-
The doctrine of contra proferentem “puts the risk of ambiguity, lack of clarity, and absence of proper warning on the drafting party which could have forestalled the controversy[,] ... and it saves contractors from hidden traps not of their own making.” Metcalf Const. Co. v. United States, 53 Fed.Cl. 617, 629 (2002) (alteration in original) (citing Sturm v. United States, 190 Ct.Cl. 691, 697, 421 F.2d 723 (1970)). However, an exception to the rule of contra proferentem exists when the defect in the solicitation is found to be patent, rather than latent. See Blue & Gold Fleet, 492 F.3d at 1313 (citing E.L. Hamm & Assocs., 379 F.3d at 1342). In Blue & Gold Fleet, the Federal Circuit held that a plaintiff that “has the opportunity to object to the terms of a government solicitation containing a patent error and fails to do so prior to the close of the bidding process waives its ability to raise the same objection subsequently in a bid protest action in the Court of Federal Claims.” 492 F.3d at 1313 (emphasis added). The court explained,
We have applied the doctrine of patent ambiguity in cases where, as here, a disappointed bidder challenges the terms of a solicitation after the selection of another contractor. See Stratos Mobile Networks USA, LLC v. United States, 213 F.3d 1375, 1381 (Fed.Cir.2000); Statistica, Inc. v. Christopher, 102 F.3d 1577, 1582 (Fed.Cir. 1996). Under the doctrine, where a government solicitation contains a patent ambiguity, the government contractor has ‘a duty to seek clarification from the government, and its failure to do so precludes acceptance of its interpretation’ in a subsequent action against the government. Stratos, 213 F.3d at 1381 (quoting Statistica, 102 F.3d at 1582).
Id.36
A defect is patent “when the contract contains facially inconsistent provisions that would place a reasonable contractor on notice and prompt the contractor to rectify the inconsistency by inquiring of the appropriate parties.” Stratos Mobile Networks, 213 F.3d at 1381. Conversely, a defect is latent when it is hidden or concealed and not apparent on the face of the document. See J.C.N. Const., Inc. v. United States, 107 Fed.Cl. 503, 512 (2012) (distinguishing between “subtle inconsistencies [that] do not put a reasonable contractor on notice” and “obvious, gross, [or] glaring” inconsistencies that are patent) (alteration in original) (quoting Grumman Data Sys. Corp. v. Dalton, 88 F.3d 990, 997 (Fed.Cir.1996) (in turn quoting H & M Moving, Inc. v. United States, 499 F.2d 660, 671 (Ct.Cl.1974))); see also Mountain Home Contractors v. United States, 425 F.2d 1260, 1264 (Ct.Cl.1970) (“The govern-
Here, the mistaken “registered as” language in Sections L-3 and L-6 of the Solicitation appeared to be correct but was in fact defective. Nothing about the text appeared to be implausible or contradicted other portions of the Solicitation. Before the Solicitation was issued, neither the Air Force nor the State Department, nor indeed the Danish Ministry of Foreign Affairs, understood that it was impossible to register as a foreign-owned subsidiary in the CVR. Potential offerors asked for clarification but received incorrect or erroneous answers, reflecting the Air Force‘s mistaken belief at the pertinent time. During procurement, the Air Force repeatedly assured offerors that it was possible to register as a foreign subsidiary. See supra, at 612-13. Only later, in August 2014 (three months before award), did the Air Force discover the error, see AR 20g-883, but it chose to continue with the procurement without correcting the mistake or notifying the offerors of the inaccuracy.37 In these circumstances, the underlying error was not patent. The impossibility of registering as a foreign subsidiary cannot be said to be “obvious, gross, [or] glaring,” H & M Moving, 499 F.2d at 671, when the Air Force specifically confirmed this possibility to offerors, cf. Grumman Data Sys., 88 F.3d at 998 (finding an ambiguity patent when the “agency‘s answer [was] susceptible to more than one meaning on its face“).
The question also arises whether there was reason during the procurement for offerors to investigate the veracity of the language in the Solicitation and the accuracy of the answers provided by the Air Force. See Def.‘s Reply at 7-9. Compare NVT Techs., 370 F.3d at 1162 (Where “a certain set of line items [were] expressed in a manner so different from hundreds of other line items, yielding totals disproportionate to the remainder of the solicitation,” it “should have raised a red flag for [the offeror], requiring [the offeror] to inquire“), with E.L. Hamm & Assocs., 379 F.3d at 1343 (“Without any reason to reverse engineer the daily mowing and policing acreages or, conversely, to calculate a minimum yearly total for policing using the single mowing acreage, [petitioner] had no reason to discern the error [in the solicitation].“). To discover the defect in the Solicitation in this case, the offerors would have had to assume that the Air Force‘s information was factually erroneous and then independently contact the Danish Business Authority to inquire whether it was possible to register as a foreign subsidiary. See Per Aarsleff‘s Mot. at 19. The defect was not “obvious on
Accordingly, Blue & Gold Fleet is not applicable in this case, and having itself discovered the mistake during the evaluation process, the Air Force was responsible for correcting the error. See Metropolitan Van & Storage, Inc. v. United States, 92 Fed.Cl. 232, 267 (2010) (“[I]f [the agency] did not craft the solicitation as artfully as it should have, [the agency] will be responsible for the resulting impact on the procurement.“). The government challenges this conclusion on the ground that FAR § 15.206 does not specifically state that agencies are responsible for correcting known defects in a solicitation before award. See Def.‘s Cross-Mot. at 33. The cited provision of the FAR provides that “when, either before or after receipt of proposals, the [g]overnment changes its requirements or terms and conditions, the contracting officer shall amend the solicitation.” FAR § 15.206(a). The government‘s argument is peculiar and wrong. FAR § 15.206 deals with an agency‘s decision to amend a solicitation to change requirements, terms, or conditions. Drawing a negative inference from a failure to make an amendment is not permissible, and thus the provision cannot be read to exculpate an agency from being responsible for mistaken language it includes in a solicitation.
3. Arbitrary and capricious nature of the agency‘s decision.
“It is blackletter law that a procuring agency may only accept an offer that conforms to the material terms of the solicitation.” Furniture by Thurston v. United States, 103 Fed.Cl. 505, 518 (2012); see also E.W. Bliss Co. v. United States, 77 F.3d 445, 448 (Fed.Cir.1996) (“[A] proposal that fails to conform to the material terms and conditions of the solicitation should be considered unacceptable and a contract award based on such an unacceptable proposal violates the procurement statutes and regulations.“) (internal citations and quotation marks omitted). A provision in a solicitation is material “if failure to comply with it would have a non-negligible effect on the price, quantity, quality, or delivery of the supply or service being procured.” Furniture by Thurston, 103 Fed.Cl. at 518 (citing USfalcon, Inc. v. United States, 92 Fed.Cl. 436, 457 (2010) (in turn citing Centech Grp., 554 F.3d at 1038)). As previously discussed, a material term in the RFP required the awardee to be a genuine Danish or Greenlandic enterprise, and to that effect, prohibited foreign subsidiaries from competition. The Air Force awarded the Thule Contract to a company that is incorporated as a Danish entity, but one that undeniably is a subsidiary of a United States (foreign) company. See supra, at 615, 617; see also Exelis Services’ Cross-Mot. at 22 (acknowledging that “at the time of its registration, Exelis Services was a subsidiary of [Vectrus] Systems, an American corporation“). On these facts, the Air Force contravened federal procurement law when making an award based upon a proposal that failed to satisfy the material source restriction that limited competition to Danish or Greenlandic entities and not subsidiaries of foreign companies. Further, the government has neither “‘provided a coherent and reasonable explanation of its exercise of discretion‘” in making the award to a Danish subsidiary of a non-Danish company, Impresa Construzioni, 238 F.3d at 1333 (quoting Latecoere Int‘l, Inc. v. United States Dep‘t of Navy, 19 F.3d 1342, 1356 (11th Cir.1994)), nor has it articulated a “rational connection between the facts found and the choice made,” Motor Vehicle Mfrs., 463 U.S. at 43 (quoting Burlington Truck Lines v. United States, 371 U.S. 156, 168, 83 S.Ct. 239, 9 L.Ed.2d 207 (1962)).
In short, the agency‘s decision to award Exelis Services the Thule Contract was arbitrary and capricious and not in accord with federal procurement law. See
Greenland Contractors and Copenhagen Arctic further aver that the Air Force failed to evaluate the proposals in accord with Section H-6 and PWS 3.1.16 of the Solicitation, which required offerors to “[m]aximize ... contract-related purchases and subcontracts from Danish and Greenlandic sources” and to “[d]ocument and justify any exceptions.” AR 88-5227, 5279; see also Greenland Contractors’ Mot. at 18-22; Copenhagen Arctic‘s Mot. at 20-27.38 Both of these plaintiffs contend that if Per Aarsleff should be awarded the contract, work would be performed by the United States-based subcontractor, [* * *], see supra, at 18 n. 23. Greenland Contractors and Copenhagen Arctic argue that the Air Force unreasonably failed to evaluate Per Aarsleff‘s justification for relying on the United States teaming partner. See Greenland Contractors’ Mot. at 20; see also Copenhagen Arctic‘s Mot. at 21-22.39 Per Aarsleff does not deny that it intends to rely on [* * *] if awarded the Thule Contract. Rather, it aligns itself with the government and Exelis Services on this protest ground, arguing that “[S]ection H-6 and PWS 3.1.16 apply only to post-award subcontract arrangements and merely reflect a subjective ‘performance standard’ to maximize purchases from Danish and Greenlandic sources, not a strict and measurable offeror eligibility requirement or minimum proposal qualification.” Per Aarsleff‘s Mot. at 28-29; see also Def.‘s Cross-Mot. at 41 (“Copenhagen Arctic and Greenland Contractors’ arguments are meritless because offerors were not required to justify their use of United States subcontractors in their proposals.“); Exelis Services’ Cross-Mot. at 54 (“[T]hese RFP provisions establish performance standards to be used in the administration of the contract, but do not—as Greenland Contractors asserts—establish eligibility or evaluation criteria.“).
The court agrees that the RFP provisions cited by Greenland Contractors and Copenhagen Arctic establish post-award performance standards that pertain to administration of the contract and do not create a supplementary evaluation criterion. See, e.g., AR 88-5227. (Section H is titled “Special Contract Requirements“) (emphasis added).40
Indeed, there were no instructions in Section L (“Instructions, Conditions, and Notices to Offerors“) to include documentation regarding use of foreign subcontractors, and Section M (“Evaluation Factors for Award“) did not require the Air Force to evaluate offerors in accord with PWS 3.1.16. Cf. Bae Sys. Tech. Solutions & Servs., Inc., B-409914, 2014 WL 5804275, at *7 n. 5 (Comp.Gen. Sept. 16, 2014) (holding that certain criteria were “not part of the key personnel evaluation under section M of the [task order request], but rather, a performance requirement listed in section H.10 of the [task order request] under personnel training and certification requirement.“). And further, the plain text of the Solicitation makes evident that the focus of Section H-6 and PWS 3.1.16 is on “purchases and subcontracts” relating to products, not services. See AR 88-5277.41 Section H notes that “[p]roducts not acquired by Danish and/or Greenlandic sources must be procured [in accord with certain identified FAR provisions],” AR 88-5227 (emphasis added), and PWS 3.1.16 requires compliance with
Nonetheless, teaming arrangements were important insofar as employment opportunities for Danish and Greenlandic citizens were concerned. Copenhagen Arctic emphasizes that Section M of the Solicitation required compliance with “all stated terms, conditions, representations, certifications, and all other information required by Section L of this [S]olicitation,” and “[n]on-compliance with the RFP may be ground to eliminate the proposal from consideration for contract award.” Copenhagen Arctic‘s Mot. at 23 (quoting AR 88-5261, 5254). All four offerors submitted proposals agreeing to comply with paragraph 3.1.16 of the PWS during performance of the contract, see AR 173-15049 (Copenhagen Arctic‘s Proposal Revisions (July 23, 2014)) (“We have no exceptions to the solicitation terms and conditions.“); AR 111-7908 (Per Aarsleff‘s Proposal Revisions (July 3, 2014)) (“We take no exceptions to the terms and conditions included in the solicitation.“); AR 153-12281 (Greenland Contractors’ Initial Proposal (May 9, 2014)) (“Greenland Contractors I/S has no exceptions to any of the solicitation requirements.“); AR 97-6314 (Exelis Services’ Initial Proposal (May 9, 2014)) (“Exelis [Services] will comply with all of the Performance Work Statement (PWS) requirements and takes no exception to any of the terms, conditions, representations, certifications or provisions in this [S]olicitation.“). A contracting officer is ordinarily entitled to rely upon such certifications when determining whether to accept a proposal. See Allied Tech. Grp., Inc. v. United States, 649 F.3d 1320, 1330 (Fed.Cir.2011). Even so, the court may inquire whether there was a basis on the face of the offers for the Air Force to conclude that the offerors could not (or would not) comply with Section H or PWS 3.1.16 during contract performance. See Hyperion, 115 Fed.Cl. at 553 (finding that the agency should have found proposals to be technically unacceptable where it was readily apparent that the offerors “would not and could not comply with the limitations on subcontracting incorporated into the solicitation“) (citing Centech Grp., 554 F.3d at 1038).
Greenland Contractors argues that the court‘s decision in Hyperion “is on all fours with this case ... [b]ecause it was clear from the face of their proposals that Exelis [Services], Per Aarsleff, and Copenhagen Arctic inten[ded] to [***].” Greenland Contractors’ Mot. at 19, 21. In Hyperion, a limitation-on-subcontracting clause, set forth
The court agrees with the government that this case is factually distinguishable from Centech and Hyperion. The proposals submitted by the offerors for this Solicitation lacked facial indications that the offerors could not or would not maximize the use of Danish or Greenlandic employees during contract performance. Besides submitting proposals agreeing to comply with the terms of the Solicitation during performance of the contract, the proposals submitted by Per Aarsleff, Exelis Services, and Copenhagen Arctic were ostensibly compliant with Section H and PWS 3.1.16. Additionally, the Air Force did make some inquiries into whether teaming arrangements between Danish offerors and American subcontractors provided appropriate opportunities for Danish and Greenlandic employees. The ENs were answered, in at least one instance by a change providing that the Danish contractor and not the American subcontractor would be the employer. Hr‘g Tr. 64:11 to 65:8 (May 22, 2015) (describing the EN made to, and the revised proposal submitted by, Copenhagen Arctic).43 Greenland Contractors contends that the Air Force did not effectively query the other offerors even though it “had ... in front of it, based on the proposals, strong indications that the[] offerors were not planning to maximize their use of subcontractors from Denmark or Greenland, and, in fact, were going to use their U.S. partners.” Hr‘g Tr. 46:11-16. There is some validity to the point made by Greenland Contractors about teaming, both respecting Exelis Services and Per Aarsleff, see Hr‘g Tr. 62:1025, but those offerors appear to have been planning to [***]. Hr‘g Tr. 100:14 to 101:3.
The Air Force specifically acknowledged that Danish and Greenlandic offerors could use United States-based subcontractors to compete for the contract. In response to a question asking whether or not “subcontractors [can] come from ... the US,” the Air Force stated that the “only requirements that the [g]overnment know[s] of until the [Danish Ministry of Foreign Affairs] criteria give more guidance” were that the prime contractor had be a “Danish company” and employees had to be “US or Danish citizens.” AR 62-3509 (Industry Day Question Answer Matrix). Absent from this answer was any requirement that subcontractors had to be Danish or Greenlandic. See id. Per Aarsleff correctly notes that “these statements from [the Air Force] reinforce the interpretation that the RFP did not prohibit U.S. teaming partners, and that the preference for Danish or Greenlandic subcontractors pertained to acquisition of supplies during performance.” Per Aarsleff‘s Mot. at 32. The government also argues that “[e]xcluding offerors for not justifying their use of United States companies as teaming partners or subcontractors would have introduced unstated evaluation criteria in violation of [FAR] § 15.305(a).” Def.‘s Cross-Mot. at 46 (citing Coburn Contractors, LLC, B-408279.2, 2013 WL 5718848 (Comp.Gen. Sept. 30, 2013)); see also
In short, Copenhagen Arctic and Greenland Contractors have not shown that the Air Force misapplied Section H-6 and PWS
C. Prejudice
Relief in a bid protest may be available to a protestor that demonstrates not only that there was a significant error in the procurement process but also that it was prejudiced by the error. See PGBA, LLC v. United States, 60 Fed.Cl. 196, 203 (2004), aff‘d, 389 F.3d 1219 (“To prevail in a bid protest, a disappointed offeror must show both significant error in the procurement process and prejudice to its posture in the process.“) (citing Advanced Data Concepts, 216 F.3d at 1057). In this respect, a protestor must show that there was a “substantial chance it would have received the ... contract award, but for the alleged error in the procurement process.” McAfee, Inc. v. United States, 111 Fed.Cl. 696, 712 (2013) (quoting Gentex Corp. v. United States, 58 Fed.Cl. 634, 653 (2003)) (citing cases). This inquiry into “prejudice” is separate from the inquiry into standing, see supra, at 622. “While both use the ‘substantial chance’ doctrine, prejudice at the jurisdictional threshold can be satisfied on the basis of the plaintiff‘s allegations, whereas prejudice on the merits can only be satisfied by the effect of an agency decision adjudged to be unlawful.” Hyperion, 115 Fed.Cl. at 556 (citing Linc Gov‘t Servs., LLC v. United States, 96 Fed.Cl. 672, 696 (2010)).
Here, the Air Force knowingly awarded the Thule Contract to a wholly-owned shell company created by a non-Danish, non-Greenlandic parent company in contravention of a material term in the Solicitation that prohibited subsidiaries of such entities from competing in the procurement. The Air Force has indicated that it will conduct a new acquisition at some future date based on new eligibility criteria. Plaintiffs were prejudiced by the Air Force‘s error respecting eligibility. Each of them was a Danish company or a Danish partnership, and each was principally owned by Danish or Greenlandic sources. Had the Air Force properly applied the eligibility criteria during the procurement, it would have found Exelis Services’ proposal to be unacceptable, the plaintiffs would have had a substantial chance of receiving the award, and one of the plaintiffs would have won the competition with a lowest-priced, technically acceptable and eligible proposal. This second inquiry into prejudice has been satisfied. See Hyperion, 115 Fed.Cl. at 556; see also Linc Gov‘t Servs., 96 Fed.Cl. at 696.
D. Equitable Relief
Having found that the Air Force‘s contractual award was arbitrary, capricious and contrary to the terms of the Solicitation, the court is guided by traditional equitable considerations in addressing if it should grant equitable relief barring the Air Force from giving effect to the improperly granted contract. In making this determination, “the court must consider whether (1) the plaintiff has succeeded on the merits, (2) the plaintiff will suffer irreparable harm if the court withholds injunctive relief, (3) the balance of hardships to the respective parties favors the grant of injunctive relief, and (4) the public interest is served by a grant of injunctive relief.” Centech Grp., 554 F.3d at 1037 (citing PGBA, 389 F.3d at 1228-29). If all four criteria are satisfied, the court may award declaratory or injunctive relief that is appropriate in the circumstances. See
It is well-established that the loss of potential work and profits from a government contract constitutes irreparable harm.
The court must balance the potential harm to plaintiffs in not granting an injunction against the potential harm to the government should an injunction be granted. See PGBA, 389 F.3d at 1231-32; see also Hyperion, 115 Fed.Cl. at 557. The government indicates that the Air Force “does not want to rush the transition and risk operational issues [with a new contractor phase-in],” and therefore it may extend Greenland Contractors’ performance into fiscal year 2016. See Def.‘s Cross-Mot. at 60, 62. The government estimates that a bridge contract with Greenland Contractors will cost the Air Force [***] more than the price reflected in the contract awarded to Exelis Services. Id. at 60-61. Based on its estimates, the government argues that a bridge contract may cost the Air Force an additional “[***] [USD] per month.” Id. at 61. Alternatively, the government argues that a contractor given an award after the court‘s decision “would not be able to take over performance until July 2016[,] ... which would result in another nine months of performance by Greenland Contractors at a cost of approximately $[***] to $[***], plus re-procurement costs and any additional costs resulting from the award to a higher-priced offeror.” Id. at 63; see also Def.‘s Reply at 22 n.16 (“[E]ven a two or three month delay and award to [a contractor] would likely cost the Air Force [***].“).45
Although “[e]conomic harm to the [g]overnment is ... a relevant factor,” Def.‘s Reply at 22 (citing cases), the “burden of re[-]procurement costs” occurs whenever an improper award of a contract is set-aside. See Huntsville Times Co. v. United States, 98 Fed.Cl. 100, 122 (2011) (“[T]he government would, of course, bear ... the burden of re[-]procurement costs.“). Further, even if the Air Force is harmed in the ways the government asserts, such harm is attributable to “delays of [the Air Force‘s] own creation.” Sheridan Corp. v. United States, 95 Fed.Cl. 141, 155 (2010); see also Parcel 49C Ltd. P‘ship v. United States, 31 F.3d 1147, 1153 (Fed.Cir.1994) (rejecting the government‘s attempt “to preserve its ill-gotten gain” and affirming a trial court‘s injunction that “returned the contract award process to the status quo ante any illegality“). The Air Force “could have forestalled this controversy simply by excluding Exelis Services from the competition when it explicitly informed the agency that it was a wholly-owned subsidiary [of a U.S. company] (June 2014), or when the [Danish Business Authority] informed AFSPC that it was not possible to register as a foreign subsidiary in the CVR (August 2014).” Per Aarsleff‘s Mot. at 37.
In short, the government has awarded the contract to an ineligible offeror, and it has not demonstrated that the additional financial costs to the Air Force associated with granting injunctive relief outweigh the harm to plaintiffs denied an opportunity to compete based upon properly applied eligibility criteria. Cf. ARKRAY USA, Inc. v. United States, 118 Fed.Cl. 129, 138 (2014) (finding that the balance of hardships weighed in bid-protestor‘s favor, even though the government represented “that it will save as much as $64.8 million per year” if it were allowed to proceed with an award issued in error).
Finally, the public interest in maintaining the integrity of the procurement process weighs heavily in favor of granting a permanent injunction. See Hyperion, 115 Fed.Cl. at 557; see also PGBA, 60 Fed.Cl. at 221. The public interest is best served by abiding by the required eligibility criteria and evaluative steps in a procurement. BCPeabody Constr. Servs., Inc. v. United States, 112 Fed.Cl. 502, 514 (2013). Moreover, the Danish and United States governments are currently collaborating to correct the mistake regarding the eligibility criteria. Permitting Exelis Services to continue as the contractor for Thule Air Base and receive the benefits of the Thule Contract not only is inconsistent with these diplomatic discussions, but it “betray[s] the spirit of the [bilateral] agreements and intent of the original eligibility criteria.” Per Aarsleff‘s Mot. at 38.
There is also no reason to believe that an injunction will cause any interruption of vital services to Thule Air Base or affect the critical missions of the base. See Greenland Contractors’ Reply at 28-29; see also Def.‘s Cross-Mot. at 60-63 (discussing costs associated with an injunction, but omitting any argument that an injunction would prevent the Air Force from ensuring continuity of service at Thule Air Base); Def‘s Reply at 21-23 (same).
The requirements for issuance of equitable relief have been satisfied, and the Air Force‘s contractual award to Exelis Services should be set aside. Despite plaintiffs’ urgings, the court declines to provide any more specific instruction to the Air Force regarding its further actions in this procurement.
CONCLUSION
For the reasons stated, plaintiffs’ motions for judgment on the administrative record are GRANTED, and the government‘s and Exelis Services’ cross-motions for judgment on the administrative record are DENIED. The award by the Air Force of the Thule Contract to Exelis Services is set aside, and the Air Force is enjoined from proceeding with that contract. The clerk is directed to issue final judgment in accord with this disposition.
Plaintiffs are awarded their costs of suit.
It is so ORDERED.
Notes
(c) The head of an agency may use procedures other than competitive procedures only when—
(4) the terms of an international agreement or a treaty between the United States and a foreign government or international organization, or the written directions of a foreign government reimbursing the agency for the cost of the procurement of the property or services for such government, have the effect of requiring the use of procedures other than competitive procedures[.]
(a) Authority....
(2) Full and open competition need not be provided for when precluded by the terms of an international agreement or a treaty between the United States and a foreign government or international organization, or the written directions of a foreign government reimbursing the agency for the cost of the acquisition of the supplies or services for such government.
(b) Application. This authority may be used in circumstances such as—
(1) When a contemplated acquisition is to be reimbursed by a foreign country that requires that the product be obtained from a particular firm as specified in official written direction such as a Letter of Offer and Acceptance; or
(2) When a contemplated acquisition is for services to be performed, or supplies to be used, in the sovereign territory of another country and the terms of a treaty or agreement specify or limit the sources to be solicited.
For the purposes of this opinion, the court will refer to Exelis Services’ current parent company as Vectrus.
Greenland Contractors’ Mot. at 13 (translating AR 20g-881 (E-mail from Streander to Benedicte Schleimann (Aug. 5, 2014))) (emphasis added).Attached please find four CVR reports/certificates on four companies that are all understood to be Danish companies.
Are you permitted to or are you able to help by confirming that they are in actual fact considered to be Danish companies and not subsidiaries of foreign companies?
I do not have experience enough to judge this and need your help. It does look as if they are autonomous Danish companies.
Before or after beginning the hearing on a motion for a preliminary injunction, the court may advance the trial on the merits and consolidate it with the hearing. Even when consolidation is not ordered, evidence that is received on the motion and that would be admissible at trial becomes part of the trial record and need not be repeated at trial.