Applications Research Corp. v. Naval Air Dev. Center

• Citation: 752 F. Supp. 660
• Decision Date: 04 December 1990
• Docket Number: Civ. A. No. 89-9007.
• Parties: APPLICATIONS RESEARCH CORPORATION v. NAVAL AIR DEVELOPMENT CENTER, Frank J. Drummond, H. Lawrence Garrett, III, and SelectTech Services Corporation.
• Court: U.S. District Court — Eastern District of Pennsylvania

752 F. Supp. 660

APPLICATIONS RESEARCH CORPORATION v. NAVAL AIR DEVELOPMENT CENTER, Frank J. Drummond, H. Lawrence Garrett, III, and SelectTech Services Corporation.

Civ. A. No. 89-9007.

United States District Court, E.D. Pennsylvania.

October 24, 1990.

As Amended December 4, 1990.

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John C. Fenningham, Corr, Stevens & Fenningham, Trevose, Pa., for plaintiff.

Joel R. Feidelman, Alan R. Grayson, Washington, D.C., Gregory T. Magarity, Philadelphia, Pa., for SelectTech.

James G. Sheehan, U.S. Atty., John N. Joseph, Asst. U.S. Atty., for the Federal Defendants.

MEMORANDUM OF DECISION

McGLYNN, District Judge.

Plaintiff Applications Research Corporation (ARC), the then incumbent contractor for computer management and support services at the Naval Air Development Center (NADC or Center), was unsuccessful in its bid to remain as contractor when a 1989 procurement was awarded to SelectTech Services Corporation (SelectTech). Distressed by this turn of events, ARC brought this action charging the Secretary of the Navy—acting through NADC and Contracting Officer Frank J. Drummond¹ —with an abuse of discretion and a violation of federal procurement laws.

Specifically, in Counts I and II of its amended complaint, ARC seeks judicial review under Section 702 of the Administrative Procedure Act (APA), 5 U.S.C. § 702. ARC avers: (1) that the Federal Defendants abused their discretion by irrationally concluding that SelectTech's bid was responsive to a key personnel clause in the procurement solicitation, notwithstanding the known intention of SelectTech to staff the contract with personnel different from those listed in the company's technical proposal; (2) that by allowing SelectTech to misrepresent its intention to staff the contract with the key personnel listed in its proposal, the Federal Defendants illegally ignored the terms of the key personnel and evaluation criteria clauses in the solicitation and arbitrarily evaluated ARC and SelectTech's proposals as technically equal; (3) that the Federal Defendants abused their discretion by finding SelectTech to be a responsible bidder despite that company's misrepresentation of its women-owned business status; (4) that the Federal Defendants showed favoritism toward SelectTech and abused their discretion by permitting amendments to the solicitation that accommodated only SelectTech; (5) that the Federal Defendants arbitrarily denied ARC the opportunity to supplement its award protest and to inspect NADC's files; and (6) that the Federal Defendants have acted illegally and have abused their discretion by allowing SelectTech to perform the contract with fewer personnel than were required in the solicitation, thus materially modifying the contract.

Accordingly, ARC asks the court to provide the following relief: to declare ARC to be the successful bidder on the NADC contract; to enjoin the Federal Defendants to set aside the award to SelectTech and to prevent SelectTech's further performance; and to enjoin the Federal Defendants to award the contract to ARC.

Additionally, in Count III of its amended complaint, ARC seeks to set aside the award of the contract to SelectTech and to collect damages from SelectTech resulting from that company's alleged staffing and women-owned status misrepresentations in its contract proposal to NADC.

SelectTech filed a motion to dismiss ARC's amended complaint. The administrative record was filed and the Federal Defendants moved for summary judgment against ARC. Thereafter, ARC moved for summary judgment against all defendants. SelectTech responded to ARC's motion by filing a cross-motion for summary judgment and by renewing its motion to dismiss.² These motions are now before the court. For the reasons stated below, ARC's motion will be denied and the defendants' motions will be granted.

I. JURISDICTION AND STANDARD OF REVIEW

A. Subject Matter Jurisdiction and Standing

At the outset, it is noted that because ARC does not seek specific performance of its previous contract with NADC but, rather, seeks to have the recent award to SelectTech set aside and made to itself, this action is not within the United States Claims Court's exclusive jurisdiction.³ ARC's amended complaint predicates this court's subject matter jurisdiction to decide Counts I and II on several regulations and statutes, including Section 10 of the APA, 5 U.S.C. § 702 (1977). Section 702 does not, however, provide an independent grant of subject matter jurisdiction to review agency action. Califano v. Sanders, 430 U.S. 99, 105, 107, 97 S.Ct. 980, 984, 985, 51 L.Ed.2d 192, 199, 200-01 (1977). Nevertheless, the court does have jurisdiction under 28 U.S.C. § 1331 (West Supp.1990): Counts I and II "arise under" not only the Federal Acquisition Regulations (FARs) codified in 48 C.F.R., chapter 1, but also the federal common law of government procurement.

As a result of ARC and SelectTech's diversity of citizenship, the court also has jurisdiction over Count III. 28 U.S.C. § 1332 (West Supp.1990).

Additionally, as an unsuccessful bidder on a government contract, ARC has constitutional and prudential standing on its own behalf and on behalf of the public to seek judicial review of the award. Coco Bros., Inc. v. Pierce, 741 F.2d 675, 678 n. 2 (3d Cir.1984); Merriam v. Kunzig, 476 F.2d 1233, 1240 (3d Cir.1973); National Gateway Telecom, Inc. v. Aldridge, 701 F.Supp. 1104, 1116 (D.N.J.1988).

B. Standard of Review

A resolution of the pending motions requires an examination of the interplay between the APA and Rule 56 of the Federal Rules of Civil Procedure—a process that has received scant judicial attention.

1.) Summary Judgment

Under Rule 56(c), a party is entitled to summary judgment in his favor "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R. Civ.P. 56(c). Rule 56(e) further provides:

When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party.

Fed.R.Civ.P. 56(e).

Asserted disputes of fact are "material" if their resolution could affect the outcome of the case under the applicable substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202, 211 (1986); Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155, 1158 (3d Cir.1990). Matters of proof and evidentiary requirements are not germane to a materiality determination. Anderson, 477 U.S. at 248, 106 S.Ct. at 2510, 91 L.Ed.2d at 211.

Inquiry into the genuineness of a factual dispute does, however, introduce procedural and substantive evidentiary burdens into a summary judgment action. Mirroring the directed verdict standard of Federal Rule of Civil Procedure 50(a) in all but procedural posture, the "genuine issue" standard focuses on the sufficiency of evidence and is satisfied if the evidence bearing on the disputed fact is such "that a reasonable jury could return a verdict for the nonmoving party." Id. at 248, 106 S.Ct. at 2510, 91 L.Ed.2d at 211-12; Hozier, 908 F.2d at 1158; Turner v. Schering-Plough Corp., 901 F.2d 335, 340-41 (3d Cir.1990). The evidence must be more than "merely colorable"; it must be "significantly probative." Anderson, 477 U.S. at 249, 106 S.Ct. at 2510, 91 L.Ed.2d at 212; United Transp. v. Conemaugh & Black Lick R.R. Co., 894 F.2d 623, 628 (3d Cir.1990). Furthermore, the genuineness inquiry "necessarily implicates the substantive evidentiary standard of proof that would apply at the trial on the merits." Anderson, 477 U.S. at 252, 254, 106 S.Ct. at 2512, 91 L.Ed.2d at 214 (applying clear and convincing standard in libel action). Credibility determinations, the weighing of the evidence, and the drawing of inferences from the underlying facts are, however, jury functions that a judge is not to perform when ruling on a summary judgment motion. Anderson, 477 U.S. at 255, 106 S.Ct. at 2513, 91 L.Ed.2d at 216; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538, 553 (1986); Kronmuller v. West End Fire Co. No. 3, 123 F.R.D. 170, 173 (E.D.Pa.1988).

The oft-cited trilogy of 1986 Supreme Court cases, Anderson, Matsushita, and Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986), refocused the burden of both the moving and the nonmoving parties in summary judgment actions. Regardless of which party would have the burden of persuasion at trial, the initial burden is on the moving party to "show" that there is an absence of evidence to support the nonmoving party's case. Celotex, 477 U.S. at 325, 106 S.Ct. at 2554, 91 L.Ed.2d at 275; First Nat'l Bank of Pa. v. Lincoln Nat'l Life Ins. Co., 824 F.2d 277, 280 (3d Cir.1987). The moving party need not, however, produce evidence showing the absence of a genuine issue of material fact: that is, he need not "negate" the nonmoving party's claim. Celotex, 477 U.S. at 323, 325, 106 S.Ct. at 2553-54, 91 L.Ed.2d at 274-75.

Once the moving party carries his burden, Rule 56(e) requires the nonmoving party to "designate" specific facts showing that there is a genuine issue for trial as to each element essential to the nonmoving party's case and on which that party will bear the burden of proof at trial. Celotex, 477 U.S. at 322, 324, 106 S.Ct. at 2552-53, 91 L.Ed.2d at 273-74; J.F. Feeser, Inc. v. Serv-A-Portion, Inc., 909 F.2d 1524, 1531 (3d Cir.1990). The nonmovant must "do more than...