Saratoga Development Corp. v. US, Civ. A. No. 90-0474.

• Decision Date: 31 October 1991
• Docket Number: Civ. A. No. 90-0474.
• Citation: 777 F. Supp. 29
• Court: U.S. District Court — District of Columbia
• Parties: SARATOGA DEVELOPMENT CORPORATION, Plaintiff, v. UNITED STATES of America, et al., Defendants.

777 F. Supp. 29

SARATOGA DEVELOPMENT CORPORATION, Plaintiff, v. UNITED STATES of America, et al., Defendants.

Civ. A. No. 90-0474.

United States District Court, District of Columbia.

October 31, 1991.

Bruce A. Baird, Covington & Burling, Washington, D.C., for plaintiff.

Richard N. Reback, Asst. U.S. Atty., Washington, D.C., for defendants U.S. and Pennsylvania Ave. Development Corp.

Steven W. Widerman, Arent, Fox, Kintner, Plotkin & Kahn, Washington, D.C., for defendants intervenors Delta Partnership and Federal Triangle Corp.

MEMORANDUM OPINION

JOHN H. PRATT, District Judge.

Before the Court are plaintiff Saratoga Development Corporation's motion for partial summary judgment, defendant United States' motion for summary judgment, their respective replies, and defendant-intervenor Delta Partnership's opposition to plaintiff's motion.

I.

The parties do not dispute the following facts. This is a "disappointed bidder" case in which plaintiff Saratoga Development Corporation ("Saratoga") challenges the decision of the Pennsylvania Avenue Development Corporation ("PADC") selecting Delta Partnership ("Delta") to develop the Federal Triangle site.

The PADC is a wholly-owned government corporation created by Congress. 40 U.S.C. §§ 871-85. Its mandate is to ensure the suitable development, maintenance, and use of Pennsylvania Avenue and the area adjacent to the Avenue between the Capitol and the White House. The Federal Triangle Development Act, 40 U.S.C. § 1101-09, added the Federal Triangle site to the PADC development area and directed the PADC to prepare a proposal for development of that site in consultation with the General Services Administration ("GSA") and the International Cultural and Trade Center Commission ("ICTCC"). The Act authorized the construction on the Federal Triangle site of a new federal office building, second in size only to the Pentagon, to house an International Cultural and Trade Center ("ICTC") and to consolidate a number of agencies currently scattered in various locations throughout the Washington Metropolitan area. In addition, the Federal Triangle Project is expected to house exhibits, performing arts theatres, retail space, and conference areas.

The PADC began soliciting proposals to develop the Project in November, 1988. Administrative Record ("AR"), tab 2. The PADC issued an elaborate Prospectus for the Federal Triangle Project that set forth eight bid criteria and building requirements. These criteria were: (1) responsiveness of the design to the goals and objectives of the development program; (2) responsiveness of the design to the urban design objectives, architectural criteria, and historic preservation considerations; (3) a schedule that allowed for completion of the facade by January 1993, and completion of the entire project by 1994; (4) the experience, capability, and resources of the development team; (5) the financial experience, resources, and commitment of the developer; (6) the projected costs; (7) project management experience; and (8) an affirmative action plan. AR, tab 20(a) at 29-30. Seven development teams submitted proposals by the June 1, 1989 cut-off date. Each development team then gave an oral presentation of its proposal to the PADC Board of Directors (the "Board"), the PADC staff, and representatives of the GSA and the ICTCC. AR, tab 39. In addition, the PADC engaged both its staff and teams of outside consultants to assist it in reviewing and evaluating the proposals. Extensive reviews ensued, which included numerous written questions to each development team to obtain information for the purpose of clarifying and explaining the given proposal. See, e.g., AR, tabs 22(b), (d), (e).

On October 18, 1989, the PADC Board convened to select the development team for the Federal Triangle Project. It initially met in executive session with its staff, the Mayor of the District of Columbia, the Administrator of the GSA, and the Chairman of the ICTCC. After the executive session was concluded, the Board opened its meeting to the public. Before it proceeded to vote on which proposal to select, however, the Board adopted two resolutions concerning the Federal Triangle Project. First, a resolution eliminating the financial experience, resources, and commitment criteria from the Prospectus was proposed.¹ AR, tab 16. Without discussion, the resolution was adopted. AR, tab 40 at 126.

The second resolution which the Board considered before the selection vote concerned affirmative action. The resolution called for the following: (1) incorporation into the development agreement with the PADC of documented evidence that the selected developer will reach all affirmative action goals required by the Prospectus; (2) the PADC's encouragement of the selected developer to enhance minority participation by recruiting minorities listed in unsuccessful proposals; (3) an agreement for so-called "first source" employment with the District of Columbia Department of Employment Services; and (4) the establishment of a quarterly affirmative action reporting system. AR, tab 17. The resolution was passed unanimously. AR, tab 40 at 130.

The Board then proceeded to the vote on whom to select for the Federal Triangle Project. After brief discussion, the Board, voting by secret ballot, selected the defendant-intervenor Delta. AR, tab 18. The tally was Delta, seven votes; BPT, three votes; Great Plaza, two votes; and Prentiss, one vote.² AR, tab 40 at 142. Delta having received the necessary majority, the Board then formally adopted a resolution selecting it as the developer for the Federal Triangle Project. AR, tab 18.

Approximately one week later, Saratoga sent a letter to the PADC "taking exception to the outcome of the competition and the manner in which it was reached." Memorandum in Support of Saratoga's Motion for Partial Summary Judgment and in Opposition to Defendants' Motions to Dismiss and for Summary Judgment, exhibit B, tab 2 ("Saratoga Motion"). On November 8, 1989, the Chairman of the PADC responded by referring Saratoga to the selection criteria in the Prospectus and stating that "each proposal was carefully reviewed, analyzed and considered in light of the stated criteria." Id. By letter dated November 22, 1989, Saratoga replied by again stating its position that it believed "the PADC had departed, both obviously and materially, from its own articulated criteria." Id.³

Ultimately, on March 1, 1990, Saratoga filed this cause of action seeking judicial review of the PADC's actions in connection with the award of the Federal Triangle Project.

II.

As a preliminary matter, defendants raise numerous procedural defenses. Defendants assert that plaintiff lacks constitutional and prudential standing, that plaintiff has failed to join an indispensable party, that the complaint is barred by laches, and that the PADC's action in this case is unreviewable as a matter of law. We will discuss these in turn.

A. Constitutional Standing

Defendants assert that plaintiff lacks constitutional standing because it was not a bidder in this instance. While defendants admit that it is well-settled that a disappointed bidder who can show injury in fact can have standing to challenge the award of a government contract, Scanwell Laboratories, Inc. v. Shaffer, 424 F.2d 859 (D.C.Cir.1970), defendants analogize the instant dispute to the facts of Control Data Corp. v. Baldrige, 655 F.2d 283, 292 (D.C.Cir.), cert. denied, 454 U.S. 881, 102 S.Ct. 363, 70 L.Ed.2d 190 (1981), where the plaintiff was not a bidder.

Defendants argue that plaintiff in this cause of action does not satisfy the test for constitutional standing because plaintiff did not submit a bid for the development. Instead, plaintiff was merely half of a team (along with James Crozier & Company) that submitted a bid as co-developers. Control Data does not so limit Scanwell Laboratories. In Control Data, plaintiff was not part of a bid team; it was a nonbidder claiming the right to challenge rules promulgated by the Secretary of Commerce. Indeed, Control Data was not a "disappointed bidder" case at all because there was no contract at issue being bid upon. Saratoga, unlike the plaintiff in Control Data, was a bidder. Control Data does not stand for the proposition that every member of a bid team must be a party to an action for constitutional standing to exist, nor have defendants cited to any cases which so hold. Plaintiff here has constitutional standing as a "disappointed bidder" under Scanwell Laboratories.

B. Prudential Standing

Defendants also argue that plaintiff lacks standing on prudential grounds because it was not within the "zone of active consideration." National Fed'n of Fed. Employees v. Cheney, 883 F.2d 1038 (D.C.Cir.1989), cert. denied, ___ U.S. ___, 110 S.Ct. 3214, 110 L.Ed.2d 662 (1990). The court in National Federation stated that

Not every bidder in a solicitation may assert disappointed bidder standing, otherwise nuisance suits could handicap the procurement system. Rather, standing is conferred only to those bidders who are "`within the zone of active consideration' for the bid's award."

Id. at 1053 (quoting National Maritime Union of Am. v. Commander, Military Sealift Command, 824 F.2d 1228, 1237-38 n. 12 (D.C.Cir.1987); other citations omitted).

The language of National Maritime makes it apparent that this doctrine should be invoked sparingly. It is designed to weed out those cases where the "bidder ... believed that it would have no significant likelihood of obtaining the bid," but nonetheless brings suit "for its nuisance value." National Maritime, 824 F.2d at 1237 n. 12. As the Federal Circuit stated in an opinion cited to approvingly in National Maritime, a disappointed bidder need not show that the activity it complains about was the but for cause of its failure to procure the contract, only that it had a "substantial chance" of receiving the award. CACI, Inc.-Federal v. United States, 719 F.2d...