COFC Clarifies When Awardees Have Standing to Protest; Sirius Federal, LLC (f/k/a Force 3, LLC), CDW Government LLC, CounterTrade Products, Inc. and Blue Tech Inc. v. United States, COFC Nos. 21-1030C, 21-1041C, 21-1043C & 21-1053C

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Intervenors’ motions to dismiss for lack of standing are denied. Several protesters challenged multiple awards made under an RFQ. The protesters were members of some of the winning teams, but the quotations they submitted as team leads had been rejected. The intervenors argued that as members of the winning teams, the protesters lacked standing to protest. The court rejected this argument, reasoning that an awardee lacks standing to challenge its own award, but it still has standing to protest awards it did not receive. Moreover, as members of winning teams, the protesters were not necessarily awardees of the contracts. Their interest in protesting the awards they lost as team leads was distinct from the interests they had as team members on winning teams.

The General Services Administration issued an RFQ seeking to award multiple information technology blanket purchase agreements. The RFQ did not preclude individual companies from participating in more than one quote as a member of different contracting teams. Thus, the RFQ allowed an offeror to submit a quotation as a team lead and to also participate as a team member on other quotations. The RFQ provided that unlike subcontractors, all the members of a single contracting team would be considered in privity with the government.

GSA received 27 quotes in response to the RFQ. As permitted, many of the vendors submitted quotations as a team lead but also participated as team members in other quotations. GSA selected nine quotations for award. Four companies, Sirius Federal, LLC, CDW Government LLC, CounterTrade Products, Inc., and Blue Tech Inc., filed protests with the Court of Federal Claims. Sirius, CounterTrade, and Blue Tech were all members of other winning teams, but their quotations as team leads had been rejected. CDW had submitted a quotation as team lead but was not a member of any winning team. The four protests were consolidated.

Two vendors that had received awards as team leads, Telos Corporation and Red River Technology, LLC, intervened in the protests. Telos and Red River moved to dismiss the protests of Sirius, Blue Tech, and CounterTrade for lack of standing. CounterTrade and CDW moved for a preliminary injunction seeking prevent GSA form proceeding with the awards.

The court first addressed the motions to dismiss. Telos and Red River argued that most of the protesters lacked standing to protest because they were members of other teams that had received awards. Essentially, the protesters were awardees, so they lacked a direct economic interest that would be affected by GSA failure to award them a contract.

The court, however, did not find the intervenors’ arguments convincing. As an initial matter, the notion that awardees can never have bid protest standing had been soundly rejected by the COFC. An awardee still has an economic interest in stopping the government from stepping outside stated procurement terms in making further awards.

Additionally, the court reasoned that the cases the intervenors cited in support of their motions all held that awardees lack standing to challenge their own contract award. In many of those cases, the protester/awardees had challenged the terms of awarded contracts. Cases challenging the terms of an existing contract need to be brought under the Contracts Disputes Act. In this case, however, the protesters, while members of winning teams, were alleging that GSA made evaluation errors that prevented them from obtaining separate awards.

The intervenors argued that the protester could not qualify as “interested parties” because they already had BPAs as team members. But the court found that this argument rang hollow. Both intervenors had moved to intervene in the case arguing that they had spent time and preparing proposals and thus had an interest in intervening to protest their investment. It was hard for the court to accept that the intervenors could have an interest in defending their award as team leads while the protesters did not.

Moreover, the court reasoned, being a mere member of a winning team was not that same as being a team lead. The RFQ provided that team leads may add or remove members from their teams. Thus, members of a winning team did not have the same assurances that they would retain their status as team members they did not lead. Accordingly, the protesters’ interest in winning a contract as team lead was distinct from their interest in participating on a winning team.

The court next turned to CDW’s and CounterTrade’s motions for preliminary injunctions. Applying the factors for injunctive relief, the court found that the protesters had not established a likelihood of success on the merits. CDW challenged the evaluation of its proposal and the best value tradeoff. The court found that GSA had properly applied evaluation factors and made appropriate discretionary decisions. CounterTrade argued that the RFQ required vendors to offer an expensive Advanced Web Security Gateway, and that some of the awardees had not proposed this expensive Gateway. The court, however, found that a less expensive Gateway satisfied RFQ’s requirements.

The court found that CDW and CounterTrade would be irreparably harmed without an injunction. Nevertheless, the court reasoned that the harm to the protesters in lost profits did outweigh the security risk that an injunction posed to the government.

Protester Sirius is represented by David A. Edelstein and Laurence Schor of Asmar, Schor & McKenna, PLLC. Protester CDW Government is represented by David Y. Yang, Stuart B. Nibley, Erica L. Bakies, Sarah F. Burgart, Melody A. Alemansour of K&L Gates. Protester CounterTrade is represented by Scott F. Lane, Katherine S. Nucci, and Jayna Marie Rust of Thompson Coburn LLP. Protester Blue Tech is represented by Paul F. Khoury, Brian G. Walsh, Cara L. Lasley, Sarah B. Hansen, and Adam R. Briscoe of Wiley Rein LLP. Intervenor Telos Corporation is represented by C. Peter Dungan, Roger V. Abbott, and Jarrod R. Carman of Miles & Stockbridge. Intervenor Red River Technology is represented by Gregory R. Hallmark, Amy L. Fuentes, and Kelsey M. Hayes of the Holland & Knight LLP. The government is represented by Reta E. Bezak, Brian M. Boynton, Robert E. Kirschman, Jr., Patricia M. McCarthy, Catharine Parnell, and Bret Vallacher of the Department of Justice as well as Jaron E. Chriss of the General Services Administration.

COFC - Sirius Federal