IAP Worldwide Servs. v. United States

• Decision Date: 28 March 2022
• Docket Number: 21-1570C
• Parties: IAP WORLDWIDE SERVICES, INC., Plaintiff, v. THE UNITED STATES, Defendant, and VECTRUS SYSTEMS CORPORATION, Defendant-Intervenor.
• Court: U.S. Claims Court

IAP WORLDWIDE SERVICES, INC., Plaintiff,
v.
THE UNITED STATES, Defendant,

and VECTRUS SYSTEMS CORPORATION, Defendant-Intervenor.

No. 21-1570C

United States Court of Federal Claims

March 28, 2022

Reissued for Publication: April 5, 2022

Kara L. Daniels, Arnold & Porter Kaye Scholer LLP, Washington, D.C., for Plaintiff. Of counsel were Nathaniel E. Castellano, Thomas A. Pettit, and Aime JH Joo.

Tanya B. Koenig, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C., for Defendant. With her on the briefs were Brian M. Boynton, Acting Assistant Attorney General, Martin F. Hockey, Jr., Acting Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel was Major Seth Ritzman, Contract Litigation & Intellectual Property Division, United States Army Legal Services Agency, Fort Belvoir, VA.

Adam K. Lasky, Seyfarth Shaw LLP, Seattle, WA, for Defendant-Intervenor. Of counsel were Edward V. Arnold, Stephanie B. Magnell, and Bret C. Marfut, Seyfarth Shaw LLP, Washington, DC.

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MEMORANDUM OPINION ^[*]

MATTHEW H. SOLOMSON, JUDGE

This case involves a billion dollar procurement; the range and number of the parties' arguments reflect the stakes of the dispute.

In this post-award bid protest action, Plaintiff, IAP Worldwide Services, Inc. ("IAP"), challenges the decision of Defendant, the United States - acting by and through the U.S. Department of the Army, Army Contracting Command-Aberdeen Proving Ground (the "Army") - to award the Operations, Maintenance, and Defense of Army Communications in Southwest Asia and Central Asia ("OMDAC-SWACA") contract to Defendant-Intervenor, Vectrus Systems Corporation ("Vectrus"). IAP contests that contract award as arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, including provisions of the Federal Acquisition Regulation (the "FAR"). The parties filed cross-motions for judgment on the administrative record pursuant to Rule 52.1 of the Rules of the United States Court of Federal Claims ("RCFC").

For the reasons set forth below, the Court finds for IAP on a single issue, but declines to issue either monetary or injunctive relief, at least on the record as it currently stands. Instead, the Court orders supplemental briefing on the question of appropriate relief. Whether this case ultimately yields IAP a pyrrhic victory remains to be seen.

I. FACTUAL BACKGROUND^[1]

A. The Solicitation

On April 3, 2019, the Army issued Solicitation No. W91RUS-19-R-0018 (the "Solicitation" or "RFP") for the OMDAC-SWACA contract, seeking operations and

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maintenance services for communications and information systems supporting the 160th Signal Brigade of the U.S. Army Central, its subordinate units, U.S. Central Command, and the U.S. Army Regional Cyber Center Southwest Asia.^[2] The services are for various locations, including sites in Afghanistan, Iraq, Kuwait, Bahrain, the United Arab Emirates, Jordan, and Qatar.^[3]

The Solicitation informed potential offerors that the Army intended to award a single performance-based contract utilizing cost-plus-fixed-fee and cost-reimbursable contract line items ("CLINs"), with a performance period of two sixty-day phase-in periods, an eight-month base period, and four one-year option periods. AR 3756 (§ B.2); AR 3974. The planned contract is estimated to be worth over one billion dollars.^[4] Vectrus is the incumbent contractor for the services sought in the RFP. AR 301 (Acquisition Plan). Proposals were due on May 17, 2019. AR 3951 (§ L.4.1.A).

The Solicitation instructed offerors to submit proposals addressing four factors (in descending order of importance): (1) mission support/technical approach ("MS/TA"); (2) past performance; (3) cost; and (4) small business participation. AR 3113 (§ M.1.A). The RFP similarly specified that this is a "best value" procurement and that "[a]ll non-cost factors[, ] when combined[, ] are significantly more important than the cost factor." AR 3113 (§ M.1.A). The Solicitation emphasized that "[o]fferors must clearly demonstrate their ability to meet all requirements specified in [the] solicitation" and that "[f]ailure to furnish full and complete information that demonstrates the [o]fferor's ability to satisfy the specified requirements may cause an offer to be considered unacceptable and therefore will be ineligible for award." AR 3114 (§ M.1.A). The Army cautioned offerors that "the [o]fferor with the lowest overall estimated cost to the [g]overnment" is not guaranteed to win the award, as the government may determine that "the non-cost benefits offered by another [o]fferor [may] warrant paying a higher cost." AR 3113 (§ M.1.A).^[5]

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The Solicitation repeatedly advised offerors that "the [g]overnment intends to award a contract without discussions, but reserves the right to hold discussions, if necessary," and, thus, "cautioned" offerors "to examine [the] solicitation in its entirety and to ensure that their proposal[s] contain[] all necessary information, provide[] all required documentation, and [are] complete in all respects." AR 3952 (§ L.5.1.A); see also AR 3113 (§ M.1.A) ("[I]t is the [g]overnment's intention to award without discussions. Offerors are encouraged to present their best technical proposal and costs in their initial proposal submissions. Should the Contracting Officer determine discussions are necessary[, ] the [g]overnment reserves the right to hold them."); AR 3123 (§ M.5) (noting government's intent to award without discussions based upon initial offers). Nevertheless, the RFP provided that, in the event the Army decided to engage in discussions, "a competitive range will be determined and [o]fferors [will be] notified of inclusion/exclusion," but "[t]he competitive range may be limited for purposes of efficiency." AR 3113 (§ M.1.A).

1. Factor 1 - Mission Support/Technical Approach

Pursuant to the Solicitation, the MS/TA factor is the most important evaluation factor in the best value calculus. AR 3113 (§ M.1.A). For this factor, the RFP required offerors to propose their management and technical solution based on the specific requirements listed in the Performance Work Statement ("PWS") and supporting documents, including technical exhibits and attachments. AR 3960-61 (§ L.8.2). The MS/TA evaluation factor is divided into four subfactors: (1) management ("Subfactor 1"); (2) technical ("Subfactor 2"); (3) property management ("Subfactor 3"); and (4) quality control ("Subfactor 4"). AR 3113 (§ M.1.A), 3115 (§ M.3). Subfactor 1 is the most important subfactor, while Subfactor 2 is more important than Subfactors 3 and 4. AR 3113 (§ M.1.A).

The RFP instructed Offerors that MS/TA proposals should be "sufficiently specific, detailed, and complete as to demonstrate clearly and fully that the [o]fferor has a thorough understanding and knowledge of the complexities inherent in the performance of this requirement." AR 3960 (§ L.8.2). Offerors were encouraged to provide "a holistic approach versus addressing each PWS element." AR 3961 (§ L.8.2). Furthermore, offerors were warned that "[s]tatements that the [o]fferor understands, can, or will perform the requirements of the PWS without supporting information or

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narratives are inadequate." AR 3960 (§ L.8.2); see also AR 3953 (§ L.6.2) (warning offerors that "[u]nless specifically stated," offerors shall not "paraphrase the requirements of the PWS, or use phrases such as 'unsurpassed levels of reliability,' or 'standard techniques will be employed'"); AR 3961 (§ L.8.2) (similar instructions); AR 3961 (§ L.8.2) (cautioning that "[p]roposals that merely mimic the PWS may receive a less favorable evaluation rating"); AR 4112 (Source Selection Plan) ("mere promises to comply with contractual requirements are insufficient basis for a favorable rating; evidence is required in support of any statements relating to promised performance").

For Subfactors 1 and 2, the RFP provided that proposals would be adjectivally rated as "Outstanding," "Good," "Acceptable," "Marginal," or "Unacceptable."^[6] AR 3116 (§ M.4.a). These ratings were to be based on the Army evaluation team's "consideration of risk" together with an offeror's assessed "strengths, weaknesses, significant weaknesses, uncertainties, and deficiencies." AR 4113 (Source Selection Plan). Subfactors 3 and 4, in contrast, were rated on a pass/fail basis. AR 3116 (§ M.3.1). For each offeror's overall MS/TA rating, the Army evaluators developed a consensus for the adjectival rating utilizing the same scale as for Subfactors 1 and 2. AR 3116 (§ M.3.1).

To be considered for award, an offeror had to receive an overall MS/TA rating of "Acceptable" or higher. AR 3113 (§ M.1.A). An offeror that received a rating of less than "Acceptable" (i.e., "Marginal" or "Unacceptable") on "Sub-factors 1 and 2," or a failing score on "Sub-factors 3 and 4," would "not move forward in the source selection process, and [would] not be considered for award." AR 3113-14 (§ M.1.A) (emphasis added).

a. Subfactor 1 - Management

For Subfactor 1, the RFP directed offerors to propose an "effective management approach/solution," and "describe, in detail, [their] overall experience and [m]anagement approach for this effort, understanding of the requirement, feasibility of the approach, and completeness of the proposed solution." AR 3116-17 (§ M.4), 3961

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(§ L.8.2.A). This portion of the proposal had to contain: (1) the offeror's methodologies related to its corporate and program management organizational approach/solution (§ L.8.2.A.1); (2) methodologies and solution to provide government "oversight and/or tracking in . . . key areas," including key personnel (§ L.8.2.A.2); (3) "managing multiple locations across the theater with varying types and size sites" (§ L.8.2.A.3); (4) a contract "phase-in" plan and procedures for in-processing new employees (§ L.8.2.A.4); (5) "change management and...