September 23, 2019

September 23, 2019

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September 20, 2019

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Recent COFC Decision Underscores Need for Vigilance in Demonstrating Protest Standing

Many a bid protest has been dismissed for lack of standing.  But often that ostensible lack of standing has more to do with how the protest arguments are crafted than the facts underlying the procurement.  The Court of Federal Claims’s recent decision in Precision Asset Management Corp. v. United States (No. 15-1495) is a good example.

Precision protested the Department of Housing and Urban Development’s award of an asset management services contract to KM Minemier & Associates, LLC.  In evaluating proposals, HUD first identified technically-acceptable proposals on a pass/fail basis.  Among the technically-acceptable proposals, HUD then evaluated past performance and price to determine which proposal offered the best value to the government.

Precision’s proposal received a “Neutral/Unknown Confidence” rating for past performance.  KM Minemier’s proposal, by contrast, received a “Good/Significant Confidence” rating.  Precision protested the award, arguing that “had HUD evaluated Precision’s proposal in accordance with the Solicitation instead of treating it as a joke and had HUD evaluated Minemier’s proposal in accordance with the facts, Precision would have stood a substantial chance of receiving this award.”  Specifically, Precision alleged that, but for HUD’s evaluation errors, its own past performance rating would have been higher while KM Minemier’s would have been lower.

The court declined to reach the merits of the protest, instead dismissing it on Precision’s failure to demonstrate standing—that is, to “show that there was a ‘substantial chance’ it would have received the contract award but for the alleged error in the procurement process.”  The decision turned on the fact that another (unnamed) offeror stood between KM Minemier and Precision.  That unnamed offeror had a lower price than Precision and also received the highest possible past performance rating—“Excellent/High Confidence.”  Thus, even if HUD had entirely botched the evaluation of KM Minemier’s and Precision’s past performance—and KM Minemier received the lowest rating and Precision received the highest rating—the unnamed offeror would still have the same past performance rating as Precision, and a lower price.

The court did not state that a protestor in Precision’s position had no chance of demonstrating standing.  To the contrary, the problem was that Precision “made no argument and presented no facts to” distinguish itself from the unnamed offeror.  The court explained that the fact of Precision’s higher price “alone does not prevent [Precision] from establishing standing, but it does require that [Precision] make an additional showing that it offered some experience or service that might have caused [HUD] to value its proposal above” the unnamed offeror’s, notwithstanding Precision’s higher price.  In other words, Precision fell short on standing because it did not even attempt to attack or distinguish itself from the offeror in between it and KM Minemier.

The lesson to protestors and their counsel is that targeting the awardee alone may be insufficient—particularly in situations where the protestor is not clearly next in line for award.  An offeror ranked third or fourth (or lower) in an evaluation does not necessarily lack standing to protest, but must be sure to explain why that is the case, given the other offeror(s) ahead of it.  For example, a protestor may argue that the agency’s error infected the entire evaluation such that any ranking (formal or otherwise) is invalid, and/or challenge the “in between” offerors on the merits of their proposals and ratings.  Precision may not have prevailed had it argued its superiority to the unnamed offeror, but making the argument may well have required the court to at least address Precision’s protest on the merits.

© 2019 Covington & Burling LLP

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About this Author

Kayleigh Scalzo, Covington, Litigation attorney
Associate

Kayleigh Scalzo represents clients in a broad array of high- stakes litigation matters with the government and other private parties. She litigates bid protests at the Government Accountability Office, Court of Federal Claims, state courts, and before federal and state agencies. Ms. Scalzo also litigates Administrative Procedure Act cases and other civil matters in the U.S. Courts of Appeals and U.S. District Courts.

Kayleigh Scalzo represents clients in a broad array of high- stakes litigation matters with the government and other private parties. She litigates...

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