Nat'l Mall Tours of Wash., Inc. v. U.S. Dep't of the Interior, Civil Action No. 15-0529 (ABJ)

• Court: United States District Courts. United States District Court (Columbia)
• Writing for the Court: AMY BERMAN JACKSON United States District Judge
• Parties: NATIONAL MALL TOURS OF WASHINGTON, INC., Plaintiff, v. UNITED STATES DEPARTMENT OF THE INTERIOR, et al., Defendants.
• Decision Date: 18 March 2016
• Docket Number: Civil Action No. 15-0529 (ABJ)

NATIONAL MALL TOURS OF WASHINGTON, INC., Plaintiff,
v.
UNITED STATES DEPARTMENT OF THE INTERIOR, et al., Defendants.

Civil Action No. 15-0529 (ABJ)

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

March 18, 2016

UNDER SEAL

MEMORANDUM OPINION

Plaintiff National Mall Tours of Washington, Inc. ("National Mall Tours") has brought this action against the United States Department of the Interior, Secretary of the Interior Sally Jewell, the National Park Service ("Park Service"), and Director of the Park Service Jonathan Jarvis, challenging the Park Service's award of a concession contract for guided bus tour services in Washington, D.C. Compl. [Dkt. # 1]. Plaintiff alleges that there was a change in the controlling interest of the awardee, City Sightseeing Washington D.C, Inc., d/b/a Big Bus Tours ("Big Bus Tours"), after the proposals had been submitted but before the award was finalized. Id. ¶ 2. According to plaintiff, this rendered the Big Bus Tours proposal invalid, and since the Park Service failed to give adequate consideration to the change, the award to Big Bus Tours was improper. Id. ¶ 3. Plaintiff also asserts that the Park Service failed to comply with its statutory obligation to submit a contract with anticipated gross receipts over $5 million to Congress for a period of sixty

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days before awarding the contract. Id. ¶ 4. Plaintiff asks the Court to declare the contract award invalid and to direct the Park Service to redo the solicitation. Id., Prayer for Relief, at 27-28.¹

Plaintiff endeavors to create the impression that there has been a recent, nefarious foreign takeover of the tour operator for the nation's capital. It contends that the Park Service failed to give due consideration to this change in ownership, which in plaintiff's view, should have barred Big Bus Tours from receiving the contract. Compl. ¶¶ 2-3 (asserting that Big Bus Tours "had been purchased by a foreign-owned corporation . . . and therefore its controlling interest had changed," and that the Park Service "had the legal authority to review this change in ownership . . . but failed to do so"); id. ¶ 50 ("[T]he intended awardee was purchased by Exponent Private Equity."); id. ¶ 51 ("National Mall Tours is unaware of why the intended awardee would agree to be taken over by a new owner."). But that is simply not what took place. Throughout the entire contract award process, Big Bus Tours was a wholly-owned subsidiary of Open Top Sightseeing USA ("Open Top Sightseeing"), a U.S. company, which has always been a wholly-owned subsidiary of Big Bus Tours Limited, a U.K. company. So what this case turned out to be about is whether the award should be invalidated because between the time Big Bus Tours submitted its proposal and the time the Park Service reached its decision, a U.K. private equity firm acquired an ownership stake in Big Bus Tours Limited, the U.K.-owned grandparent company of Big Bus Tours, or because the Park Service failed to submit the contract to Congress and wait sixty days before awarding it.

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This case is not only marred by a gap between the facts and the rhetoric; it is also a case in search of a theory. While plaintiff has advanced different legal theories in its complaint, its motion for summary judgment, and at oral argument, it has yet to supply the Court with any legal basis for overturning the contract award under the APA. Because the Court finds that the certifications made by Big Bus Tours in its proposal concerning its ownership were not invalidated by the change in the grandparent company's ownership, and because the Park Service properly considered this information in any event, it will not invalidate the award on that basis. The Court also finds that it was not unreasonable for the Park Service to determine that it could only anticipate annual gross receipts based on the services required under the contract, and that the anticipated amount was below the threshold at which Congressional notification was required. Therefore, plaintiff's motion for summary judgment will be denied, and defendant's cross-motion for summary judgment will be granted.

BACKGROUND

I. Factual Background

This case arises out of a National Park Service solicitation for a ten-year concession contract to provide "interpretive transportation services" - guided bus tours - for visitors to the National Mall and other landmarks in Washington, D.C. Administrative Record ("AR")² 3105-559 ("Prospectus"). These services had been previously provided by Big Bus Tours under a

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contract that was due to expire on March 31, 2015. AR 1041; AR 3136. The Park Service issued the Prospectus for the new contract on October 23, 2014, and it called for all proposals to be submitted by December 12, 2014. AR3107.

The Prospectus set forth five statutorily-mandated Principal Selection Factors upon which proposals would be evaluated:

Principal Selection Factor 1. The responsiveness of the proposal to the objectives, as described in the Prospectus, of protecting, conserving, and preserving resources of the park[;]

Principal Selection Factor 2. The responsiveness of the proposal to the objectives, as described in the Prospectus, of providing necessary and appropriate visitor services at reasonable rates;

Principal Selection Factor 3. The experience and related background of the Offeror, including the past performance and expertise of the Offeror in providing the same or similar visitor services as those to be provided under the new concession contract;

Principal Selection Factor 4. The financial capability of the Offeror to carry out its proposal; and

Principal Selection Factor 5. The amount of the proposed minimum franchise fee and other forms of financial consideration to the Service. . . .

AR3113;see also 54 U.S.C. § 101913(5)(A); 36 C.F.R. § 51.17(a). The Prospectus also identified a Secondary Selection Factor: "[t]he quality of the Offeror's proposal to conduct its operations in a manner that furthers the protection, conservation, and preservation of the park and other resources through environmental management programs and activities, including, without limitation, energy conservation, waste reduction, and recycling." AR 3113; see also 54 U.S.C. § 101913(5)(B); 36 C.F.R. § 51.17(b). Finally, the Prospectus required any offeror to submit a transmittal letter certifying that the information provided in its proposal was "complete, true, and correct," including any representations regarding "individuals or entities acting as Offeror or with an ownership interest in the Offeror." AR 3118.

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The Prospectus noted that "[c]oncession contracts issued for a term of more than ten years, or when the annual gross receipts are anticipated to exceed $5,000,000, are required by law to be submitted to the Congress for sixty days before they may be awarded." AR 3114. Because the Park Service determined that the contract at issue did not meet those requirements, it advised offerors that "[t]he new concession contract will not be submitted to the Congress." AR 3114.

Three companies submitted proposals in response to the Prospectus: Big Bus Tours, City Sights DC, and National Mall Tours, the plaintiff in this action. AR 1037-230 (Big Bus Tours); AR 1292-379 (City Sights DC); AR 1380-767 (National Mall Tours). In response to Principal Selection Factor 3, Big Bus Tours, the eventual awardee, stated that it "is fully responsible for all aspects of operations" in Washington, D.C., "including Vehicle Maintenance and Operations, Sales & Marketing, Finance, Training, Safety, and Human Resources." AR 1063.³ It also explained that Big Bus Tours "is a wholly owned subsidiary of Open Top Sightseeing USA, which in turn is a wholly owned subsidiary of Big Bus Tours Limited," based in London. AR 1061. It characterized Big Bus Tours Limited as "a major international company, operating on three continents," and it further clarified that "[n]o individual or Entity owns greater than 25% of Big

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Bus Tours Ltd." AR 1059. Big Bus Tours also included a business organization form for itself and for Open Top Sightseeing, and it stated that "[h]igh level management support of the local operation" and "[f]unding, as needed," is provided by both Open Top Sightseeing and Big Bus Tours Limited. AR 1060-61.

From December 15, 2014 through December 19, 2014, and again on January 21, 2015, a Park Service evaluation panel convened to review the three proposals based on the criteria set forth in the Prospectus. AR 1775-814.⁴ The panel "consisted of one voting chair, eight voting [Park] Service employees, and three technical advisors from the Park, the Region and a contractor." AR 1776. Based on the five Principal Selection Factors and the Secondary Selection Factor, the panel gave Big Bus Tours the highest score of 20.0 points, with City Sights DC and National Mall Tours receiving 17.0 and 16.5 points, respectively. AR 1777. The panel ultimately recommended that the Big Bus Tours proposal be found responsive and that Big Bus Tours receive the contract. AR 1815. On February 16, 2015, Steve LeBel, the Park Service's Deputy Associate Regional Director, transmitted this recommendation to Robert Vogel, the Park Service's Regional Director, who approved it on March 15, 2015. AR 1816. On March 23, 2015, the Park Service sent Big Bus Tours a letter indicating that on March 16, 2015, two copies of the concession contract had been provided to Rich Goldstein, the company's General Manager, for his signature. AR 3059.

On March 19, 2015, plaintiff's CEO contacted Deputy Associate Regional Director LeBel by email and asked whether he was aware that, as he put it, "Big Bus was sold in February of this

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year." AR 3046. On March 26, 2015, plaintiff's counsel sent a more-detailed letter to LeBel, asserting that "as of February 2015, Exponent Private Equity LLP, a foreign entity, took over control of Big Bus Tours." AR 3560-62 ("Garden Letter").⁵ Since the proposals had been submitted in...