Rochester City Lines Co. v. City of Rochester, A16-1515
| Decision Date | 15 October 2018 |
| Docket Number | A16-1515 |
| Parties | Rochester City Lines Co., Relator, v. City of Rochester, et al. Respondents, First Transit, Inc., Respondent. |
| Court | Minnesota Court of Appeals |
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2016).
Affirmed
City of Rochester
James A. Godwin, Rick A. Dold, David L. Liebow, Godwin Dold, Rochester, Minnesota; and
Gary A. Van Cleve, Rob A. Stefonowicz, Bryan J. Huntington, Larkin Hoffman Daly & Lindgren Ltd., Minneapolis, Minnesota; and
Steven A. Diaz (pro hac vice), Law Office of Steven A. Diaz, Washington, D.C. (for relator)
John M. Baker, Monte A. Mills, Katherine M. Swenson, Greene Espel PLLP, Minneapolis, Minnesota (for respondents City of Rochester and Justin L. Templin)
Charles K. Maier, Richard C. Landon, Gray, Plant, Mooty, Mooty & Bennett, P.A., Minneapolis, Minnesota (for respondent First Transit, Inc.)
Considered and decided by Kirk, Presiding Judge; Schellhas, Judge; and Bratvold, Judge.
UNPUBLISHED OPINION
On remand of a moderator's denial of relator bus company's pre-bid protest issues in a competitive-bidding process, the supreme court directs this court to address whether respondent city (1) unfairly deprived relator of references and the ability to effectively compete, (2) unfairly deprived relator of the full benefit of its prior performance as respondent's bus company, (3) acted unfairly as to the competition regarding the bus company that was awarded the contract, and (4) unfairly deprived relator, a small business, of an opportunity. Because we see no basis to overturn the moderator's decision for respondents on any of these issues, we affirm.
Relator Rochester City Lines Co. (RCL) began providing bus service to respondent City of Rochester (Rochester) in about 1966. In 2011, Rochester learned that it must conduct a competitive-bidding process for its bus-service contract. Rochester duly issued a request for proposals (the 2012 RFP); relator was among the proposers. A committee (the 2012 committee) evaluated the proposals, and Rochester awarded the 2012 contract to respondent First Transit, Inc. (FT), which began operating in Rochester.
RCL sued respondents, and the district court granted summary judgment to respondents. Relator appealed, and this court affirmed. Rochester City Lines, Co. v. City of Rochester, 846 N.W.2d 444 (Minn. App. 2014) (RCL). The supreme court reversed the affirmance of one issue and remanded that issue to the district court for trial. Rochester City Lines, Co. v. City of Rochester, 868 N.W.2d 655 (Minn. 2015), cert. denied, 136 S. Ct. 849 (2016) (RCL I). Following trial, the district court granted judgment to respondents, and this court affirmed. Rochester City Lines, Co. v. City of Rochester, No. A17-1944 (Minn. App. Aug. 6, 2018) (RCL IV).
In 2016, Rochester issued an RFP for 2017-2021 bus service (the 2016 RFP). The 2016 RFP provided a process whereby proposers could submit pre-bid protests that a moderator of the RFP process would decide. FT and RCL were among the proposers, and RCL challenged the 2016 RFP with a pre-bid protest. The moderator denied the protest, and Rochester awarded the 2016 contract to FT. RCL sought certiorari review of the moderator's denial of its protest.1 This court reversed the denial on one issue and declined to consider the other issues raised in RCL's protest. Rochester City Lines, Co. v. City of Rochester, 897 N.W.2d 792, 800 (Minn. App. 2017) (RCL II). The supreme court reversed and remanded to this court for consideration of RCL's remaining issues. Rochester City Lines, Co. v. City of Rochester, 913 N.W.2d 443, 449 (Minn. 2018) (RCL III).2
The remaining issues are:
(1) that [Rochester] unfairly deprived RCL of references and the ability to effectively compete; (2) that [Rochester] unfairly deprived RCL of the full benefit of its prior performance; (3) that [Rochester] acted unfairly as to the competition regarding [FT]; and (4) that [Rochester] unfairly denied opportunities for small business.
Id. at 448. "On remand, [this] court must execute court's mandate strictly according to its terms and lacks power to alter, amend, or modify that mandate." Johnson v. Princeton Pub. Utils. Comm'n, 899 N.W.2d 860, 868 (Minn. App. 2017) (quotation omitted). The supreme court selected the above four issues from the six issues listed under "argument" in the table of contents to RCL's principal brief for RCL II. The supreme court omitted two issues: whether "[t]he [c]omposition of the [2016] [v]aluation [c]ommittee is [u]nfair," and whether "[t]he [m]oderator [s]hould [b]e [o]rdered to take [a]ppropriate [a]ctions." We infer from this omission that the supreme court has not instructed this court to address the omitted issues on remand.3
RCL III, 913 N.W.2d at 447 (quotation and citation omitted).
RCL argues on remand, as it argued to the moderator in its pre-bid protest, that Rochester unfairly deprived it of references by stating that members of the 2016 evaluation committee could not be used as references. The moderator noted that the 2016 evaluation committee was composed of Rochester staff members who were in daily contact with the operator of the transit service and of outsiders who had experience in transit operation and maintenance. He continued:
[Rochester] has further concluded that allowing those individual members of the [2016 evaluation committee] to first serve as references and then evaluate the quality of those same references could unfairly prejudice the evaluations. In [Rochester's] judgment, the better process is to seek and obtain outside references who can provide a more objective assessment of any particular responder's past performances. [Rochester] is well aware that those outside references may not be able to speak specifically to a responder's past performance on a contract with [Rochester]. But on balance, [Rochester] deemed an outsider's view of a responder's past performances (including, e.g., services provided, responsiveness and problem solving, attitudes toward customer service and staff, willingness to continue the working relationship in the future) more valuable than the same view given by and then evaluated by a member of the committee charged with recommending a contractor for selection by [Rochester]. That judgment by [Rochester] is reasonable and rational.
RCL relies on language in RCL I in which the supreme court quoted the district court's observation that the withdrawal of two Rochester employees as references in the 2012 RFP process "'effectively left RCL in the lurch.'" 868 N.W.2d at 665. The moderator found this reliance misplaced and unpersuasive.
The specific factual circumstances alleged in [RCL I] are not at issue in this [2016] RFP process. No responder has alleged that it was given any promise that any [Rochester] staff member would serve as a reference, and thus, despite [RCL's] contention, no responder is even alleged to have been "left in the lurch" in the court's terms in this RFP. [RCL's] argument that the "ultimate situation" [in 2016] is the same as it was in [RCL I] is wholly unsupported by the facts.
RCL relies on Galen Med. Assocs. Inc. v. United States, 56 Fed. Cl. 104 (2003), aff'd, 369 F.3d 1324 (Fed. Cir. 2004), for the proposition that "past performance references are allowed regardless of whether the source of a reference is a member of the evaluation committee." But Galen actually holds that "[t]he mere fact that [an incumbent's] references were included on the panel as evaluators does not support a presumption of bias." 56 Fed. Cl. at 111. As the moderator noted, RCL got "the relevant lesson from [the] case backward"; Galen does not hold that excluding an incumbent's references as evaluators supports a presumption of bias, and, in any event, RCL was not the incumbent in 2016.
Finally, the fact that no other proposers were allowed to have references who were evaluation-committee members defeats RCL's argument that it was deprived of the ability to compete by eliminating committee members as references. RCL admits that FT, then the incumbent, was also affected, but argues that FT had references from other locations, while RCL never operated anywhere except Rochester. But, as the moderator noted, "[Rochester's] choices in . . . regard [to the methodology for evaluating proposals] were reasonable, rational, and equally applicable to all responders to the RFP." RCL offers no legal support for its implied argument that preventing references from serving as evaluation committee members would be permissible only if neither the incumbent nor any other prior provider is a responder. Rochester did not unfairly deprive RCL of references and the ability to effectively compete, and we therefore conclude that no basis exists to interfere with the moderator's decision.
RCL challenged Rochester's decision that the "evaluators generally will give less weight to performance on a newly awarded contract without a performance history or on a contract that terminated more than 3 years prior to this RFP process," claiming that "[t]he 3-year rule is unfair because the time period was selected purposefully, and uniquely, to exclude RCL's extensive 46-year history of exemplary operation of public transportation service within [Rochester]." The moderator explained why Rochester gave greater weight to contracts that were either currently in effect or had terminated within the last three years.
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