Office Design Grp. v. United States

• Decision Date: 06 March 2020
• Docket Number: 2019-1337
• Citation: 951 F.3d 1366
• Parties: OFFICE DESIGN GROUP, Plaintiff-Appellant v. UNITED STATES, Cuna Supply, LLC, Defendants-Appellees GovSolutions, Inc., Defendant
• Court: U.S. Court of Appeals — Federal Circuit

951 F.3d 1366

OFFICE DESIGN GROUP, Plaintiff-Appellant

v. UNITED STATES, Cuna Supply, LLC, Defendants-AppelleesGovSolutions, Inc., Defendant

2019-1337

United States Court of Appeals, Federal Circuit.

Decided: March 6, 2020

Joseph Anthony Whitcomb, Whitcomb, Selinsky, PC, Denver, CO, argued for plaintiff-appellant. Also represented by Timothy Turner.

Tanya Koenig, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for defendant-appellee United States. Also represented by Joseph H. Hunt, Denver, CO, Robert Edward Kirschman, Jr., Washington, DC, Douglas K. Mickle.

Matthew Thomas Schoonover, Koprince Law LLC, Lawrence, KS, for defendant-appellee Cuna Supply, LLC.

Before Lourie, Reyna, and Hughes, Circuit Judges.

Reyna, Circuit Judge.

Office Design Group appeals from an order of the United States Court of Federal Claims granting judgment on the administrative record for the government and Cuna Supply, LLC. Because Office Design Group fails to establish that the government’s evaluation of its proposal was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, we affirm.

I.

On May 5, 2017, the United States Department of Veterans Affairs ("VA") issued five Requests for Proposals ("RFP") for the provision of healthcare furniture and related services for VA facilities. The five RFPs were essentially identical, except that each related to a separate geographic region. Each RFP contemplated awarding three to five contracts for indefinite delivery, indefinite quantity, with each contract having a five-year base period and one five-year option period.

The RFP¹ established that the VA would award contracts based on a best-value trade off selection process that considered three primary evaluation factors: Technical Capability, Past Performance, and Price. The VA deemed Technical Capability more important than Past Performance, and Past Performance more important than Price.

Central to this appeal is Technical Capability subfactor 3. Subfactor 3 specified that an offeror’s technical proposal must include a narrative "addressing each of the items listed under SV1, SV2, SV3, and SV4 as defined" in the Statement of Work ("SOW"). J.A. 128. SV1, SV2, SV3, and SV4 are codes corresponding to the specific services and products sought by the RFP. Subfactor 3 also required an offeror to address eight "key" elements, which included an offeror’s staffing plan, inventory and cataloging process, personnel experience and qualifications, and process used for warranty repairs.

Subfactor 3 also provided that the VA would evaluate each offeror’s technical volume of its proposal, i.e., its "technical proposal," based on the offeror’s ability "to meet all services as defined in the Statement of Work." The RFP noted that an "unacceptable" rating for any technical subfactor would result in an overall "unacceptable" technical proposal. An offeror with an unacceptable Technical Capability subfactor was ineligible for a contract award.

The RFP also included "Attachment 15," an evaluation questionnaire containing thirty-three yes or no questions regarding the service requirements from the SOW and the eight key elements listed under subfactor 3. The questionnaire was divided into four sections, each corresponding to the four SOW sections—SV1, SV2, SV3, SV4. Reproduced below are the first seven questions of Attachment 15, which correspond to SV1 of the SOW.

J.A. 166

In an amendment to the RFP, the VA clarified that Attachment 15 was to be used by the agency as a checklist to evaluate offerors’ technical proposals. The amendment provided that "Attachment 8 Sample Project Tech Evaluation and Attachment 15 Service Technical Questions are informational only. They are the checklists that will be used to evaluate the technical proposals. " J.A. 141 (emphasis added).

During contract evaluation, the VA assigned an offeror 2 points for each question in Attachment 15 that the offeror sufficiently addressed in its technical proposal. To receive a passing score for its technical proposal, an offeror needed to receive a minimum of 40 points, i.e., a "yes" for twenty of the thirty-three questions in Attachment 15.

Office Design Group ("ODG") submitted a proposal for all five regions. The VA assigned ODG an unacceptable rating for its technical proposal, rendering ODG’s overall proposal ineligible for award. The VA noted in its evaluation report that it was only able to locate responses to six of the thirty-three questions in Attachment 15 in ODG’s technical proposal, resulting in a failing score of 12 points. The VA explained that ODG’s technical proposal "lacked detail" and contained "vague info." J.A. 120. The VA also noted that ODG’s technical proposal failed to address the following seven SOW service requirements: (1) a staffing plan, (2) information regarding inventory, cataloging, and protecting VA property information, (3) information about protecting furniture from damage and loss, (4) information about executing a warranty, (5) information about providing AUTOCAD or PDF files, (6) information about its team members’ experience in the healthcare and federal industries, and (7) information about whether its personnel had knowledge about life safety, infection control, and patient privacy standards.

The VA awarded contracts to nine offerors under each of the five RFPs. Each of the awardees earned at least 40 points for its technical proposal.

ODG filed a bid protest before the Government Accountability Office ("GAO"), alleging that the VA (1) unreasonably and disparately evaluated its technical proposal in comparison to the awardees’ technical proposals and (2) improperly relied on Attachment 15 to evaluate its technical proposal. The GAO denied ODG’s protest on both grounds. ODG then filed a bid protest before the Claims Court, alleging the same two grounds.² The Claims Court determined that the VA’s use of Attachment 15 was proper and that ODG had not shown that the VA’s alleged disparate treatment was prejudicial error. The Claims Court denied ODG’s motion for judgment on the administrative record and granted the government’s and the defendant-intervenor’s cross-motion for judgment on the administrative record. ODG timely appeals. We have jurisdiction under 28 U.S.C. § 1295(a)(3).

DISCUSSION

We review the grant of a motion for judgment on the administrative record in a bid protest action de novo. Glenn Defense Marine (ASIA), PTE Ltd. v. United States , 720 F.3d 901, 907 (Fed. Cir. 2013). In a bid protest case, the inquiry is whether the agency’s actions were "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, and if so whether the error is prejudicial." Id. ; see also Alabama Aircraft Indus., Inc. Birmingham v. United States , 586 F.3d 1372, 1375 (Fed. Cir. 2009). "The court’s task is to determine whether ‘(1) the procurement official’s decision lacked a rational basis; or (2) the procurement procedure involved a violation of regulation or procedure.’ " Savantage Fin. Servs., Inc. v. United States , 595 F.3d 1282, 1285–86 (Fed. Cir. 2010) (quoting Weeks Marine, Inc. v. United States , 575 F.3d 1352, 1358 (Fed. Cir. 2009) ).

On appeal, ODG raises the same two challenges it raised before the GAO and the Claims Court. First, ODG argues that the VA’s reliance on Attachment 15 during the evaluation process was inconsistent with the terms of the RFP. Second, ODG argues that the VA disparately evaluated its technical proposal in comparison to those of various awardees. We address each argument in turn.

I.

ODG argues that the VA unreasonably strayed from the terms of the RFP by relying on Attachment 15 to evaluate its technical proposal. According to ODG, "the problem for the VA, is that it never announced ... that it planned to use responses to Attachment 15 ... as the rubric against which proposals were scored and evaluated." Appellant’s Br. 13. We reject this argument.

The VA informed all offerors, including ODG, that Attachment 15 would be used to evaluate technical proposals. An amendment to the RFP noted that Attachment 15 was to be used as a "checklist[ ]" that "will be used to evaluate the technical proposals." J.A. 141. Thus, contrary to ODG’s contention, the record establishes that the VA provided clear, reasonable notice that the VA planned to use Attachment 15 to evaluate proposals.

II.

ODG argues that the VA disparately evaluated its technical proposal. According to ODG, although its technical proposal was sufficiently similar to the awardees’ proposals, the VA improperly assigned ODG’s technical proposal a failing score. ODG provides seven examples of the VA’s alleged disparate treatment of its technical proposal.

The Federal Acquisition Regulation requires an agency to treat offerors fairly and impartially. 48 C.F.R. § 1.602–2(b) ("Contracting officers shall ... ensure that contractors receive impartial, fair, and equitable treatment."). This obligation necessarily encompasses an agency’s obligation to fairly and impartially evaluate all proposals. Equal evaluation of proposals, however, does not translate into identical evaluations. An agency is under no obligation to assign dissimilar proposals the same evaluation rating. 48 C.F.R. § 1.102–2(c)(3) ("All contractors and prospective contractors shall be treated fairly and impartially but need not be treated the same ." (emphasis added)).

Upon review, it appears that this court has not yet articulated a standard for evaluating disparate evaluation claims. The Claims Court, however, has done so, having adjudicated numerous disparate evaluation claims. To prevail at the Claims Court, a protestor must show that the agency unreasonably downgraded its proposal for deficiencies that were "substantively indistinguishable" or nearly identical from those contained in other proposals. See Enhanced Veterans Solutions, Inc. v. United States , 131 Fed. Cl. 565, 588 (2017) ; see also Red River Comput. Co. v....