Me. Behavioral Health Care v. Dahl

• Decision Date: 29 November 2016
• Docket Number: SUPERIOR COURT AUGUSTA DOCKET NO. AP-16-26
• Parties: MAINE BEHAVIORAL HEALTH CARE, Petitioner v. EDWARD DAHL et. als., Respondents
• Court: Maine Superior Court

MAINE BEHAVIORAL HEALTH CARE, Petitioner v. EDWARD DAHL et. als., Respondents

SUPERIOR COURT AUGUSTA DOCKET NO. AP-16-26

Superior Court of Maine

November 29, 2016

STATE OF MAINE

KENNEBEC, ss.

ORDER ON RESPONDENT'S MOTION TO DISMISS

I. Posture of the Case:

This case is before this Court on Respondents' Motion to Dismiss Petitioner's 80C Petition For Review Of Final Agency Action.

Oral argument on Respondents' Motion To Dismiss was conducted for October 5, 2016.

II. Procedural Background:

1. On April 28, 2016, Petitioner Maine Behavior Health filed a petition for review of final agency action pursuant to M.R. Civ. P. 80C against Respondents Edward Dahl, Director, State of Maine Bureau of General Services ("BGS"); Richard W. Rosen, Commissioner, Department of Administrative and Financial Services; and Appeal Panel, State of Maine, RFP #201506114, Crisis Mobil Resolution and Stabilization Unit Services (the "Panel").

2. On May 18, 2016, Intervenors Sweetser and The Opportunity Alliance ("TOA") filed a joint entry of appearance and statement of position requesting that this Court deny the relief sought by Petitioner.

3. On July 8, 2016, Respondents filed a Motion to Dismiss Petitioner's petition, claiming that Petitioner lacks standing.

4. On July 20, 2016, Party-in-Interest State of Maine Department of Health and Human Services ("DHHS") filed a memorandum of interested party in support of Respondents' Motion to Dismiss.

5. On July 22, 2016, this Court granted Petitioner's unopposed motion to extend the time for filing 80C briefs. Pursuant to this Court's Order, Petitioner's 80C brief shall be filed within 21 days after this Court issues its decision on Respondents' Motion to Dismiss.

6. On August 1, 2016, Petitioner filed an opposition to Respondents' Motion to Dismiss.

7. On August 9, 2016, Respondents filed a reply to Petitioner's opposition to Respondents' Motion to Dismiss.

8. On August 10, 2016, Sweetser and TOA filed a memorandum in reply to Petitioner's opposition to Respondents' motion to dismiss. Sweetser and TOA support Respondents' Motion to Dismiss.

III. Factual Background:

9. In the summer of 2015,¹ DHHS issued an RFP seeking proposals to provide certain services as part of the State of Maine Crisis Intervention System. (R, Vol. 1: Tab 1.) "The RFP sought proposals for each of eight geographic districts within the state, referred to as Districts 1 through 8. Bidders were required to submit separate proposals for each district in which they sought to provide the relevant services." (Pet'r's Pet. ¶ 9.)

10. Petitioner and Sweetser each submitted proposals for Districts 1, 2, and 4. (Pet'r's Pet. ¶ 13.) TOA submitted a proposal for District 2. (Pet'r's Pet. ¶ 13.) DHHS granted conditional awards for Districts 1 and 4 to Sweetser and for District 2 to TOA. (Pet'r's Pet. ¶ 15.)

11. Pursuant to 5 M.R.S. § 1825-E(2), Petitioner requested an appeal hearing regarding the validity of the conditional awards for Districts 1, 2, and 4, and Respondent Dahl granted Petitioner's request. (Pet'r's Pet. ¶ 17.) Sweetser and TOA were granted intervenor status in the appeal proceedings. (Pet'r's Pet. ¶ 18.) Pursuant to 5 M.R.S. § 1825-E(3), BGS convened the three-member Committee and appointed a hearing officer. (Pet'r's Pet. ¶ 19.) Petitioner, DHHS, Sweetserand TOA all participated in the appeal hearing held on March 4 and 7, 2016. (Pet'r's Pet. ¶¶ 20- 21.) Petitioner argued before the Appeal Committee that multiple portions of the RFP were legally invalid and that the method of scoring the proposals was arbitrary and capricious. (Pet'r's Pet. ¶ 23.)

12. The Appeal Committee issued its decision to BGS on March 29, 2016. The Appeal Committee found that one section of the RFP was "inconsistent" with RFP requirements, but that the RFP was still valid. However, the Committee also found that "[t]he proposals were scored in a manner that was arbitrary and capricious," and it invalidated the awards on that basis.

13. On April 15, 2016, DHHS "communicated to the bidders" that it would rescore the previously submitted proposals pursuant to the Appeal Committee's decision. (Pet'r's Pet. ¶ 26.) On April 20, 2016, Petitioner submitted a letter to BGS and DHHS requesting that DHHS reissue the RFP rather than simply rescore the previously submitted proposals. (Pet'r's Pet. ¶ 27.) On April 26, 2016, DHHS "advised the bidders" that it would continue with its plan to rescore the previously submitted proposals rather than reissue the RFP. (Pet'r's Pet. ¶ 28.)²

14. On April 28, 2016, Petitioner filed its 80C petition with this Court. Petitioner alleges that the Appeal Committee erred by failing to invalidate the contract awards on the basis of the invalidity of the RFP. It requests that this Court modify the Appeal Committee's decision accordingly.

IV. Arguments:

a. Respondents' motion to dismiss.

15. Respondents ask this Court to dismiss Petitioner's petition because Petitioner is not an "aggrieved person" under the Administrative Procedures Act ("APA") and accordingly lacks standing.

16. Respondents argue that Petitioner was not aggrieved by the Appeal Committee's decision because the Committee "was statutorily limited to validating or invalidating the DHHS contract awards. It could not modify the...awards or make new awards." (Mot. Dismiss 6.) According to Respondents, the Committee granted to Petitioner the only relief that it was capable of granting - invalidating the awards - thereby leaving Petitioner no standing to appeal. "If a party's sole interest in prosecuting an appeal is to press arguments that were not fully addressed or rejected by an agency, it does nothave standing to appeal." (Mot. Dismiss 6 (citing Desmond v. Persina, 381 A.2d 633, 638 (Me. 1978).)

b. DHHS's memorandum in support of Respondents' Motion to Dismiss.

17. DHHS argues that Petitioner has failed to assert a particularized injury because Petitioner did not have a property interest in the contract awards. (DHHS' Mem. 4 (citing Carrol F. Look Construction Co., Inc. v. Town of Beals, 2002 ME 128 ¶¶ 11-16, 802 A.2d 994).) According to DHHS, Petitioner must wait until "the rescoring, reissuing, cancellation, or some other action" relating to the RFP has occurred before Petitioner may properly appeal. (DHHS' Mem. 5 (citing 5 M.R.S. § 1825-E; Nelson v. Bayroot, 2008 ME 91, ¶ 10, 953 A.2d 378).)

18. In addition, DHHS requests that this Court expedite its decision in this matter, arguing that Petitioner's appeal has "delayed implementation of all related Crisis Intervention System contracts" and "prompted DHHS to refrain from taking any action following the [Panel's] decision." (DHHS' Mem. 6 (citing York Hosp. v. Dep't of Health & Human Servs., 2008 ME 165, ¶¶ 31-37, 959 A.2d 67).)

c. Petitioner's opposition to Respondents' Motion to Dismiss.

19. Petitioner argues that "If DHHS simply rescores the previously submitted proposals, the resulting awards will be impaired by the same legal deficiencies [as the invalidated awards], meaning that the bidders, including [Petitioner], Sweetser and TOA, will not be competing fairly...and that the losing bidders will almost certainly appeal...." (Pet'r's Opp'n to Mot. Dismiss 10.)

20. Further, Petitioner argues, the Law Court has held that parties have standing to appeal a favorable ruling if that ruling "awarded less than the relief requested." (Pet'r's Opp'n to Mot. Dismiss 11 (citing Sevigny v. Home Builders Ass'n of Maine, 429 A.2d 197, 201-02 (Me. 1981); Pinkham v. Dep't of Transp., 2016 ME 74, ¶ 5 n.3, 139 A.3d 904).)

21. Finally, Petitioner argues, the Appeal Committee's favorable ruling, "does not divest the Court of its power to provide meaningful relief, as Respondents would suggest," because the APA empowers this Court to modify the Appeal Committee's decision if it finds that the decision "is affected by an error of law." (Pet'r's Opp'n to Mot. Dismiss 11 (citing 5 M.R.S.A. § 11007(4)).)

d. Respondents' reply to Petitioner's opposition to Respondents' Motion to dismiss.

22. Respondents reply that the Committee's decision "has no precedential value and any future initiative will be independent of the process now on appeal." (Resp'ts' Reply to Pet'r's Opp'n to Mot. Dismiss 2.) Respondents distinguish Sevigny v. Home Builders Ass'n of Maine because the nominally favorable judgment in Sevigny was based on a finding that might prejudice eventually the appealing party via collateral estoppel, while collateral estoppel does not apply to the Committee's decision in this case. (Resp'ts' Reply to Pet'r's Opp'n to Mot. Dismiss 3 (citing Sevigny v. Home Builders Ass'n of Maine, 429 A.2d 197 (Me. 1981)).)

23. Furthermore, Respondents argue,

the failure of [Petitioner] to receive an award was not because of the evaluation and scoring of Cost or Economic Impact. Rather it was because [Petitioner's] proposal was rated significantly lower than proposals of the other bidders on criteria measuring Organization, Qualifications and Experience, and on Specifications of work to be Performed.

(Resp'ts' Reply to Pet'r's Opp'n to Mot. Dismiss 2.)

24. Finally, Respondents argue, by invalidating the awards, the Committee granted to Petitioner all the relief it sought and all the relief that the Committee was authorized to grant. (Resp'ts' Reply to Pet'r's Opp'n to Mot. Dismiss 3.) Respondents distinguish Pinkham v. Dep't of Transp. because the nominally favorable judgment in Pinkham granted less compensation than Pinkham sought and less than the Superior Court was authorized to grant. (Resp'ts' Reply to Pet'r's Opp'n to Mot. Dismiss 3-4 (citing Pinkham v. Dep't of Transp., 2016 ME 74, 139 A.3d 904).)

e. Intervenors' reply to Petitioner's opposition to Respondents' motion to dismiss.

25. Intervenors Sweetser and TOA "join fully" in Respondent's motion to dismiss, "concur with much of [DHHS's] supporting memorandum,"³ and reply to Petitioner's opposition. (Intervenors' Reply to Pet'r's Opp'n to Mot. Dismiss 1.)

26. Sweetser and TOA argue that "[Petitio...