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CFC Had Jurisdiction over Protest of Cancelled Solicitation

The Court of Federal Claims had jurisdiction over a protest challenging a cancelled small business set-aside solicitation because the Tucker Act authorizes review of cancelled procurements to ensure compliance with regulatory requirements. The protester was a small business contractor seeking a contract for deactivation and decommissioning of a nuclear reactor. The protester challenged the government's decision to cancel the solicitation, alleging the government violated its duties under the Federal Acquisition Regulation, specifically FAR 1.102(b)(3), which requires the government to conduct its business with "integrity, fairness, and openness," and FAR 1.102-2(c)(3), which mandates the government treat all contractors and prospective contractors "fairly and impartially." Another count in the complaint alleged the government violated FAR 19.502-2(b) when it cancelled the small business set-aside solicitation and allowed the incumbent large business contractor to perform the work. In moving to dismiss, the government argued the protester did not identify any violation of a mandatory, enforceable regulatory requirement. According to the government, the "cancellation of a negotiated procurement is an act committed to agency discretion for which there are no legal standards to apply."
Mandatory Duties
The court, however, rejected the government's "attempt to carve out challenges to negotiated procurement cancellations from [the] court's bid protest jurisdiction." Under the Tucker Act, at 28 USC 1491(b)(1), the court has jurisdiction over alleged violations of statutes or regulations "in connection with a procurement." The government argued the provisions at FAR 1.102(b)(3) and FAR 1.102-2(c)(3) were procurement guidelines that imposed no mandatory duty, and therefore, by definition could not be violated. These regulatory provisions, however, were not simply internal operating guidelines. Instead, they involved the government's obligations regarding its dealings with outside parties and were aimed at ensuring the government's actions with respect to bidders are conducted fairly and transparently. Similarly, the court could assert jurisdiction over the protester's allegation the government's decision to cancel the solicitation violated the small business provisions of FAR 19.502-2(b). According to the government, the provision did not mandate termination of contracts already being performed and the resolicitation of the same work from small businesses. The government's argument, however, confused the question of whether the provision was violated with the jurisdictional question. From a jurisdictional standpoint, the claimed violation of FAR 19.502-2(b) constituted an alleged violation of a regulation "in connection with a procurement." (FFTF Restoration Co. v. U.S., FedCl, 53 CCF ¶79,078)

(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )

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