Bid Protests at the Court of Federal Claims (COFC)

Posted on August 26, 2020 Bid Protests

The Administrative Dispute Resolution Act (ADRA) of 1996 grants exclusive federal judicial jurisdiction involving pre- and post-award bid protests to the United States Court of Federal Claims (COFC). A bid protest before the COFC proceeds according to the COFC’s rules of procedure which generally follow the Federal Rules of Civil Procedure with certain adaptations for the distinct types of cases that are within the COFC’s jurisdiction, including an appendix governing bid protest procedures.

Thus, the procedures and evidentiary rules closely mimic those for federal courts. In other words, the COFC is most formal and procedurally burdensome forum for a bid protest. Formality equates to expense—meaning that a bid protest at the COFC is typically the most expensive of the three options available to disappointed offerors.

One key difference between a bid protest at the COFC and a bid protest at the GAO is the requirement for the agency to produce the entire administrative record (i.e., all documents related to the procurement process) at the outset of the bid protest. The protestor then bears the burden of reviewing the record for completeness and requesting any supplementation of the record. Quite often limited discovery will be granted to a protestor to figure out whether the administrative record is truly complete. This is a significant advantage of filing a bid protest at the COFC versus the GAO because at the GAO the agency is only required to produce procurement documents that are relevant to the protester’s stated protest grounds. In recent years, agencies have interpreted this obligation very narrowly and produce only the minimum number of documents they believe are necessary. The GAO typically defers to the agency’s scope of “relevance” which can significantly affect the outcome of the protest. In contrast, at the COFC, the protester gets the entire administrative record which can provide the protester with the opportunity to mine the record for supplemental protest grounds that were not apparent when the initial protest was filed. The ability to identify supplemental protest grounds in a GAO protest is much more limited, especially if the protester does not properly plead its case at the onset.

The COFC can “render judgment on an action by an interested party objecting to a solicitation by a Federal agency for bids or proposals for a proposed contract or to a proposed award or the award of a contract or any alleged violation of statute or regulation in connection with a procurement or a proposed procurement.”  28 U.S.C. § 1491(b)(1). Prior to the passage of the ADRA, the COFC claimed jurisdiction over bid protests under the “Scanwell Doctrine,” which interpreted the Administrative Procedures Act (5 U.S.C. § 702) as giving the COFC jurisdiction over bid protests. Federal court jurisdiction was not exclusively with the COFC during the Scanwell Era, as U.S. District Courts around the country could also here bid protests until that authority was revoked in 2001 by the sunset provisions contained in the ADRA.

Judicial review affords a protestor federal jurisprudence as precedence, which means judicial standards can be more predictable at the COFC then they would be at the GAO or in an agency-level bid protest, although the GAO does typically follow its own decisions. In the COFC, an agency’s award will be “set aside as erroneous under the arbitrary and capricious standard if ‘(1) the procurement official’s decision lacked a rational basis; or (2) the procurement procedure involved a violation of regulation or procedure.’” McVey Company, Inc. v. United States, 111 Fed. Cl. 387, 402 (Fed. Cl. 2013).  This standard of review is described by the Federal Circuit as a “highly deferential rational basis review.” CHE Consulting, Inc. v. United States, 552 F.3d 1351, 1354 (Fed. Cir. 2008).

In addition to a predictable standard of review for agency award decisions, litigating a bid protest at the COFC will also provide a protestor with predictable standards for obtaining a temporary restraining order or preliminary injunction. To obtain a temporary restraining order or preliminary injunction, a protestor has the burden to establish: (1) they will suffer irreparable injury unless the injunction issues; (2) the threatened injury to the moving party outweighs whatever damage the proposed injunction may cause the opposing party; (3) the injunction, if issued, would not be adverse to the public interest; and (4) there is a substantial likelihood that the moving party will eventually prevail on the merits. Temporary restraining orders and preliminary injunctions are viewed as extraordinary and drastic remedies and will not be issued by the COFC unless the protestor can clearly establish these criteria. The most important of these elements is whether a protestor can show they are likely to prevail on the merits of the case. This means that a hearing pertaining to a temporary restraining order or preliminary injunction will function much like a mini trial. For that reason, it is important to identify all factual evidence and witnesses as early in the process as possible.

The COFC will also be very deferential to the agency’s technical evaluation, particularly when a contract solicitation is based on a “best value” basis.  See McVey, 111 Fed. Cl. at 403. For that reason, a protestor will have a harder time proving a contracting officer’s decision was arbitrary or capricious when that decision is based on a best value evaluation. Id.

One of the advantages of filing a bid protest at the COFC is that the COFC does not have the strict timeliness requirements of the GAO. Indeed, there are not clear timeliness requirements at all. That said, when a protestor files a pre-award protest challenging an error in a solicitation, the COFC’s current precedent is that that protest must be filed before the closing date for receipt of proposals. See Blue & Gold Fleet, L.P. v. U.S., 492 F.3d 1308, 1315 (Fed. Cir. 2007) (“a party who has the opportunity to object to the terms of a government solicitation containing a patent error and fails to do so prior to the close of the bidding process waives its ability to raise the same objection afterwards in a § 1491(b) action in the Court of Federal Claims”.) This is consistent with the GAO’s requirement that pre-award protests be filed before proposal closing. Furthermore, while there is no hard deadline for a post-award protest, if a protester waits for too long, it runs the risk that the protest will be rejected under the doctrine of laches which generally disallows a claim from a claimant who has been found to have “slept on their rights.” See Blue & Gold Fleet, 492 F.3d at 1315.

There is also no automatic stay of contract award when a protest is brought before the COFC. Rather, a protestor must file for a temporary restraining order or preliminary injunction and satisfy the four factors listed above in order for the court to order that type of relief. Additionally, if the COFC grants a preliminary injunction, the protestor generally must furnish a bond, which can be quite expensive and for which a protestor runs the risk of losing should they not prevail on the merits of the protest.

With respect to remedies, the COFC may award any relief that the court considers proper, including declaratory and injunctive relief except that any monetary relief shall be limited to bid preparation and proposal costs. As such, the COFC is generally viewed to have broader powers to order relief than the GAO, though it is rare that it issues an order in a bid protest case that goes beyond what the GAO would typically recommend.

The COFC can decide that an award was arbitrary and capricious, while at the same time not enjoining the performance of that contract by the awardee. In such situations, the COFC might allow a protestor to recoup some amount of money spent in bid preparation or proposal costs.

Practically speaking, COFC is not generally willing to force the government into a contract with a specific entity. See Mangi Environmental Group, Inc. v. U.S., 47 Fed. Cl. 10, 20 (Fed. Cl. 2000). Generally, the best that a contractor can hope for is the court finds the contract to a competitor was not awarded in accordance with the law, followed by a remand to the agency to re-consider the award decision in light of findings made by the COFC.

Contractors who are considering filing a bid protest at the COFC should contact experienced counsel who are admitted to practice before the COFC and who will adequately represent their interests against agency counsel and the Department of Justice attorneys assigned to the protest.