Government’s motion for a stay pending appeal is denied. The court had sustained an underlying protest, ordering the government to disqualify the awardee and make award to the protester. The government appealed that order and asked the court to stay execution of the judgment pending appeal. The court refused. The court found that the government was unlikely to prevail on the merits of its appeal. Also, the government would not suffer irreparable harm in the absence of a stay, but the protester would.
The State Department issued a solicitation seeking local guard services for the US embassy in Senegal. The agency received proposals from SAGAM Securite Senegal and Torres-SAS Security LLC Joint Venture. The State Department selected Torres. SAGAM filed a protest with GAO, alleging the Torres’s price was too low. The agency took corrective action to reevaluate.
While the State Department was reevaluating, it discovered that the contracting officer had violated the Procurement Integrity Act by disclosing SAGAM’s proposal information to Torres. Accordingly, the agency decided to cancel the solicitation. SAGAM then filed suit with the Court of Federal Claims, challenging the cancellation. The court determined that the State Department had erred in cancelling the solicitation. The court ordered the agency to reinstate the solicitation, disqualify Torres from the competition, and make the award to SAGAM.
The government filed a notice of appeal with the Federal Circuit. The government them moved the COFC to stay execution of the judgment pending appeal.
In deciding to a motion to stay pending appeal, the court analyzes the same factors it considers for injunctive relief: (1) likelihood of success of on the merits, (2) irreparable injury to the moving party, (3) the balance of harms between the parties, and (4) the public interest.
As to the first factor, the court found that the government was not likely to succeed on the merits of its appeal. The government argued the COFC had erred because it had failed to consider alternatives to mitigate the improper disclosure to Torres. But the court found this argument was unlikely to succeed. First, the government had not raised this argument before, and the Federal Circuit is unlikely to consider an argument raised for the first time on appeal. Second, the argument was based on speculation about the potential effectiveness of an unspecified mitigation plan. This speculation could not counter the irrationality of the government’s cancellation decision.
With regard to the second, irreparable harm, factor, the government argued that it would be harmed because execution of the judgment in this case would moot the appeal. If it just went ahead and awarded the contract to SAGAM, it was likely the Federal Circuit would find there is no longer a controversy. The COFC was not persuaded. The court reasoned there are exceptions to the mootness doctrine, and the Federal Circuit had recently applied them. The court did not believe potential mootness posed irreparable harm to the government.
Under the third, balance of harms factor, the court found that SAGAM would suffer a substantial injury if the judgment was stayed. It would lose the benefit of a new contracting opportunity and suffer from the uncertainty created by a stay. If the judgment were stayed, SAGAM would not be able to assure its employees of long-term employment, and they could leave.
Lastly, the court found that the public interest militated against a stay. There were no extraordinary circumstances in Senegal where the mission of the State Department would be better served by a stay. Absent extraordinary circumstances, there was no public interest in intruding on the normal course of the judicial process.
SAGAM is represented by Thomas A. Coulter. The government is represented by James W. Poirier of the Department of Justice.
