U.S. West Communications Services, Inc. v. U.S.

• Decision Date: 29 July 1991
• Docket Number: 90-1052,Nos. 89-1662,s. 89-1662
• Citation: 940 F.2d 622
• Parties: 37 Cont.Cas.Fed. (CCH) 76,142 US WEST COMMUNICATIONS SERVICES, INC., Appellant, v. The UNITED STATES, Appellee, and Westinghouse Hanford Company and United Telephone Company of the Northwest, Intervenors. UNITED STATES, Appellant, v. UNITED TELEPHONE COMPANY OF THE NORTHWEST, Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 622

940 F.2d 622

37 Cont.Cas.Fed. (CCH) 76,142

US WEST COMMUNICATIONS SERVICES, INC., Appellant, v. The UNITED STATES, Appellee, and Westinghouse Hanford Company and United Telephone Company of

the Northwest, Intervenors.

UNITED STATES, Appellant, v. UNITED TELEPHONE COMPANY OF THE NORTHWEST, Appellee.

Nos. 89-1662, 90-1052.

United States Court of Appeals Federal Circuit.

July 29, 1991.

Thomas P. Humphrey, II, Davis, Graham & Stubbs, Washington, D.C., argued, for appellant, U.S. West Communications Services, Inc. With him on the brief, was S. Neil Hosenball and Mark D. Colley.

Anthony H. Anikeeff, Atty., Commercial Litigation Branch, Dept. of Justice, Washington, D.C., argued, for appellee, The U.S. With him on the brief, were Stuart E. Schiffer, Acting Asst. Atty. Gen., and David M. Cohen, Director. Also on the brief, were I. Avrum Fingeret, Paul W. Lewis and Patricia D. Graham, Office of the Gen. Counsel, Dept. of Energy, Washington, D.C., of counsel.

Thomas Madden, Venable, Baetjer, Howard & Civiletti, Washington, D.C., argued, for intervenor, United Telephone Co. of the Northwest. With him on the brief, were William L. Walsh, Jr., James F. Worrall and J. Scott Hommer, III. Also on the brief, was Timothy J. Bonansinga, Gen. Counsel, United Telephone Co. of The Northwest, Hood River, Or., of counsel.

Richard O. Duvall, Timothy J. Bloomfield and Richard L. Moorhouse, Dunnells, Duvall, Bennett & Porter, Washington, D.C., were on the brief, for intervenor, Westinghouse Hanford Co.

Before ARCHER, Circuit Judge, BENNETT, Senior Circuit Judge, and RE, Chief Judge. ^*

ARCHER, Circuit Judge.

US West Communications Services, Inc. (US West), in No. 89-1662, appeals the decisions of the General Services Administration Board of Contract Appeals (GSBCA or board), taking jurisdiction under the Brooks Act, 40 U.S.C. Sec. 759 (1988), as amended, and granting the bid protest of United Telephone Company of the Northwest (United). United Telephone Co. of the Northwest, 89-3 BCA p 22,108, 111,189 (1989), and United Telephone Co. of the Northwest, 89-3 BCA p 21,916, 110,269 (1989). The telecommunications system procurement at issue was made by the Westinghouse Hanford Company (Westinghouse), which was the management and operating (M & O) contractor for the United States Department of Energy (DOE) at its Hanford nuclear facility near Hanford, Washington. The United States, in No. 90-1052, appeals from that part of the board's decision which directed DOE and Westinghouse to award the contract for the subject procurement to United. The decision of the board is vacated for lack of jurisdiction and, accordingly, it is unnecessary to consider the merits of the bid protest of United. The appeal of the United States is moot.

I

This appeal involves a potential subcontractor's bid protest regarding the procurement by Westinghouse of an Integrated Voice/Data Telecommunications System (IVDTS) for the Hanford nuclear facility. Westinghouse, as DOE's M & O contractor for this facility, had responsibility for its management, operation and maintenance, including the provision of information resources management. The latter required Westinghouse to provide high quality and reliable communications and telephone services.

The requirements for IVDTS were initially developed by Westinghouse's predecessor in 1985. Upon request by DOE, the General Services Administration (GSA) assigned the procurement of the IVDTS system to the predecessor of Westinghouse, see 40 U.S.C. Sec. 759(b), and it issued a Request for Proposals (RFP) in 1986 to which five companies, including US West and United, responded. In 1987 Westinghouse was selected as the M & O contractor and assumed the responsibility for continuing the IVDTS procurement. ¹ DOE's principal involvement in the IVDTS procurement was to oversee its M & O contractor to ensure that DOE's view of its requirements for the Hanford facility was reflected in the technical specifications.

Westinghouse's procurement team issued a major revision to the IVDTS procurement at which time only four vendors, including US West and United, responded. The proposals were evaluated and discussions were held with each vendor before Westinghouse issued a request to them for their best and final offers (BAFOs). US West, in its BAFO, objected to one of the requirements of the procurement. Westinghouse, believing that US West had misinterpreted the provision, wrote US West with its interpretation, after which the objection was withdrawn. After technical evaluations of the BAFOs were made, Westinghouse concluded that the proposals of both US West and United were strong, but ultimately selected US West because of its lower overall cost.

United protested Westinghouse's impending award of the contract to US West. It asserted that a former employee of DOE who retired as its Telecommunications Branch Chief, had provided US West with sensitive information relating to the IVDTS procurement when he became associated with a company that acted as US West's consultant for that procurement. When Westinghouse denied United's challenge to the award of the contract to US West, United protested that decision to the GSBCA. United contended that both the alleged conflict of interest and the post-BAFO communication between Westinghouse and US West made the award of the contract to US West improper.

DOE, Westinghouse, and US West moved to dismiss the GSBCA proceeding for lack of jurisdiction on the basis that the Brooks Act applies only to federal agency purchases of automated data processing equipment (ADPE). The board denied the motions, concluding that the IVDTS procurement involved ADPE subject to the Brooks Act and that the GSBCA had jurisdiction. It determined that the statutory requirements for jurisdiction were satisfied because the procurement was "under a contract with a Federal agency"--the M & O contract between DOE and Westinghouse--and required the "significant use" of ADPE. United Telephone, 89-3 BCA p 21,916 at 110,273. Although stating that an agency relationship between Westinghouse and DOE was not necessary to its jurisdiction, the board also concluded that Westinghouse was the "agent or conduit" of DOE. Id. at 110,273-74.

Following a trial on the merits, the board upheld United's protest. The board also directed DOE and Westinghouse to award the IVDTS contract to United.

II

This appeal is brought under the Contract Disputes Act of 1978, 41 U.S.C. Secs. 601-613 (1988), and our review is governed by section 609(b). Under that section, the decision of the board on any question of law is not final or conclusive and is not binding on this court. See American Elec. Laboratories, Inc. v. United States, 774 F.2d 1110, 1112 (Fed.Cir.1985). We have said, however, that legal interpretations by tribunals having expertise are helpful, even if not compelling. United States v. Lockheed Corp., 817 F.2d 1565, 1567 (Fed.Cir.1987). Also, if the board's reasoning and interpretation of law does not support its decision, that decision will nevertheless not be reversed or vacated if, as the government urges, there are other grounds to support its decision. Edward R. Marden Corp. v. United States, 803 F.2d 701, 702 (Fed.Cir.1986) ("Although we disagree with the basis on which the Board decided the case, we affirm its decision on other grounds."). The question of whether the board has statutory authority to consider the protest of a potential subcontractor in a procurement of ADPE by a government prime contractor involves a pure legal issue.

US West, as appellant, and the United States, as appellee, are in agreement that the board erred in holding that it had jurisdiction for the two reasons set forth in its opinion. Both argue that Westinghouse's procurement of ADPE from a subcontractor is not subject to the Brooks Act and that Westinghouse was not acting in the capacity of a procurement agent for DOE. The United States, however, urges that the board should be considered as having jurisdiction under the facts of this case because of the unique relationship between DOE and its M & O contractor, in this case Westinghouse, which has been recognized in decisions and regulations of the General Accounting Office. United, as intervenor, supports the jurisdictional grounds relied on by the board as well as the alternative ground proposed by the United States.

III

The board's jurisdiction over ADPE procurements is set forth in the Brooks Act, as amended. See 40 U.S.C. Sec. 759. Section 759(f)(1) provides as follows:

(f)(1) Upon request of an interested party in connection with any procurement which is subject to this section (including procurements subject to delegation of procurement authority), the board of contract appeals of the General Services Administration ... shall review any decision by a contracting officer alleged to violate a statute or regulation. Such review shall be conducted under the standard applicable to review of contracting officer final decisions by boards of contract appeals.

40 U.S.C. Sec. 759(f)(1) (emphasis added). A proceeding before the board to contest the award of a contract is initiated by the filing of a protest, which is defined as:

a written objection by an interested party to a solicitation by a Federal agency for bids or proposals for a proposed contract for the procurement of property or services or a written objection to a proposed award or the award of such a contract.

40 U.S.C. Sec. 759(f)(9)(A) (emphasis added).

As pertinent here, ADPE equipment is defined in the Brooks Act, as amended, as follows:

(2)(A) For purposes of this section, the term "automatic data processing equipment" means any equipment ... that is used ...

(i) by a Federal agency, or

(ii) under a contract with a Federal agency which--

(I) requires the use of such equipment, or

(II) requires the performance of a service or the furnishing of a product which is performed or produced making significant use of such...