Elcon Enterprises, Inc. v. WMATA, Civ. A. No. 89-3410-SSH.

• Decision Date: 31 May 1991
• Docket Number: Civ. A. No. 89-3410-SSH.
• Citation: 770 F. Supp. 667
• Parties: ELCON ENTERPRISES, INC., Plaintiff, v. WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY and Schindler Elevator Corporation, Defendants.
• Court: U.S. District Court — District of Columbia

770 F. Supp. 667

ELCON ENTERPRISES, INC., Plaintiff, v. WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY and Schindler Elevator Corporation, Defendants.

Civ. A. No. 89-3410-SSH.

United States District Court, District of Columbia.

May 31, 1991.

Michelle L. Gilbert, David B. Dempsey, Joseph F. Cunningham, Washington, D.C., for plaintiff.

Frank R. Filiatreau, Jr., Asst. Gen. Counsel, Washington, D.C., for WMATA.

Frederick V. Lyon, S. Scott Morrison, Julie A. Guagliano, Washington, D.C., for Schindler Elevator Corp. and Westinghouse Elevator Co.

OPINION

STANLEY S. HARRIS, District Judge.

Now before the Court are the Washington Metropolitan Area Transit Authority's (WMATA's) motion for summary judgment and the cross-motions for summary judgment filed by plaintiff Elcon Enterprises, Inc., and defendant Schindler Elevator Corporation.¹ For the reasons set forth below, defendants' motions are denied and plaintiff's motion is granted, with limited relief.

Background²

In April 1989, WMATA issued RFP-N-47886, requesting proposals for a three-year contract to maintain the 460 escalators in its Metrorail system (Metro).³ WMATA procurement regulations require that services of this type be procured by competitive negotiation, and that award "be made to that responsible proposer whose proposal is most advantageous to the Authority, price, technical and other factors considered."⁴ Specifically, the regulations provide, in relevant part:

7. RESPONSIBLE PROSPECTIVE CONTRACTORS

a. General Policy. Contracts shall be awarded only to responsible prospective contractors who possess the capability to successfully perform a proposed contract. Consideration shall be given to integrity, record of past performance, availability of necessary financial and technical resources, and other relevant matters.

g. Determinations of Responsibility or Non-Responsibility

No contract shall be awarded to any person or firm unless the Contracting Officer first makes an affirmative determination that the prospective contractor is responsible.... If a Contracting Officer has doubts about the productive capacity or financial strength of a prospective contractor which cannot be resolved affirmatively, he or she will determine that the prospective contractor is nonresponsible. A determination and findings supporting the determination will be prepared and placed in the contract file.

12. SELECTION OF CONTRACTOR. Upon the conclusion of discussions and after the review of "best and final offers", the Contracting Officer shall select that offeror whose proposal he determines to be most advantageous to the Authority, price and all other factors considered....

14. APPROVAL OF AWARD. When an offeror is selected for award, the Contracting Officer will request approval of the award by preparing WMATA Form "Action No. 2, Request for Approval of Award" in accordance with Section 15, Chapter I. All necessary concurrences, including General Counsel, shall be obtained.

In addition, a contract for an amount in excess of $100,000.00 requires final approval by WMATA's Board of Directors.

The Request for Proposal (RFP) stated that the "procurement would be conducted utilizing the procedures of competitive negotiation of technical and price proposals." Under the heading "INSTRUCTIONS TO PROPOSERS," the following relevant provisions were set forth:

9. Negotiations. After receipt of initial proposals, written or oral discussions may be conducted with all responsible proposers. Factors (including technical quality) will be considered to the extent necessary to resolve uncertainties relating to the technical requirements. Basic questions will not be left for later agreement during supplemental proceedings. When negotiations are conducted with more than one proposer, the relative price positions shall not be revealed. If negotiations are conducted with several proposers whether successively or not, all proposers selected to participate in negotiations will be offered an equal opportunity to submit revisions as required. Complete agreement on all basic requirements shall be the objective of these negotiations.

10. Best and Final Offer. Upon conclusion of negotiations, all responsible proposers will be informed of the specified time and date to submit their Best and Final Offer. The Best and Final Offer shall be each contractor's most favorable price proposal for the technical proposal which had been clarified and agreed to during negotiations.

11. Proposal Evaluation. Initially technical proposals will be evaluated based on material submitted in response to Paragraph 23, page RFP-9, entitled "TECHNICAL PROVISIONS REQUIREMENTS". Upon determination that the proposer meets the minimum requirements of Paragraph 23, successful proposal will be evaluated based on the factors specified in Paragraph 25, EVALUATION CRITERIA. The relative weight of importance of various items listed in the requirements has been pre-determined by a numerical scoring method and is known only by the Authority. On the basis of these submissions and their weight, the technical proposal will be scored on the established scale. The business/cost proposal will be evaluated based on the material submitted in response to Paragraph 24, page RFP-9 and 10, entitled "BUSINESS/COST PROPOSAL REQUIREMENTS." The proposal will be reviewed on the basis of all proposers being technically acceptable. Essentially, business/cost proposal will be evaluated on the amount, depth and utility of the information supplied to determine which proposal presents the most favorable overall cost parameters.

The Authority's award decision shall be based on the most favorable combination of technical score and total price.

12. Basis for Award. The contract shall be awarded to that proposer submitting the most favorable technical and business/cost proposal as determined through the evaluation procedures established for this procurement. Cost will be a factor in the award decision, although the award may not necessarily be made to that proposer submitting the lowest total price. Likewise, award will not necessarily be made for technical capabilities that would appear to exceed that needed for successful performance of the work.

13. Award of Contract. The Authority reserves the right to reject any or all proposals at any time prior to award; to negotiate with any or all proposers; to award a contract to that responsive, responsible proposer whose proposal conforming to this Request for Proposal, is most advantageous to the Authority, all factors considered. Technical proposal will be carefully evaluated to determine the proposer's capability to perform this contract. Proposers are advised that award may be made without discussion or any contact with the proposers concerning the proposals received. Therefore, proposals should be submitted initially on the most favorable terms that a proposer can submit to the Authority.

21. Disadvantaged Business Enterprise.

f. Offeror must demonstrate a specific plan to achieve a minimum DBE participation goal of 36% of the total contract expenditures. The Offeror's overall plan for DBE participation will be evaluated both as to the likelihood of meeting or exceeding the aforementioned minimum goals and regarding consistency with efficient performance of the contract.

Appendix B to the RFP set forth the requirements for meeting the 36% DBE goal. In the absence of achieving the 36% goal, a proposer could request a waiver of the goal by submitting documentation showing a good faith effort to achieve it. A proposer who failed to supply the requisite documentation or request for a waiver would be deemed a nonresponsive bidder and would not be eligible for award of the contract.

In June 1989, WMATA received initial proposals from Elcon, Westinghouse, and National Elevator Company.⁵ In accordance with the procurement regulations and the terms of the RFP, a technical review team and a business/cost review team were appointed to evaluate the proposals from the three contractors. The technical review team members, all experienced in escalator maintenance, initially evaluated the proposals on the basis of preliminary criteria.⁶ Once a determination was made that a proposer satisfied the preliminary criteria, the team members individually scored each proposal in accordance with a memorandum issued by the Director of the Office of Procurement which set forth the maximum scores available for each evaluation criterion.⁷ They did not discuss their respective scores with anyone else on the team. In addition, they were instructed not to discuss the technical proposals with anyone on the business/cost team, in order to ensure that they would not be influenced by information obtained by the other team. The team members then submitted the individual scores to the Chairman of the team, who then averaged the individual scores and determined a composite score.

After the proposals were evaluated initially, Elcon received a composite score of 50, the highest score possible, for its technical proposal. Westinghouse received a score of 49.2.⁸ The scores, together with a written explanation of how the team arrived at the scores, were forwarded to the Office of Procurement. After receiving the scores, officials from the Office of Procurement called a meeting with the Chairman and Vice Chairman of the technical team. At the meeting, Charles Stalzer, WMATA's Supervisor of the Equipment Supply and Services Section, questioned how it could be that the incumbent Westinghouse, with its staff and experience, would not receive a higher score than a competing proposer.⁹ Stalzer asked the technical team members to reevaluate their proposals based on his comments.

The technical team members rescored their proposals, with Westinghouse receiving a composite score of 46.5 points and Elcon receiving 44 points. In reevaluating the proposals, most of the team members eliminated all of Elcon's points for past experience on a large transit...