A contractor cries foul at the Court of Federal Claims: bad faith on a canceled procurement (now with AI comparison)

In Bear Mountainside Realty LLC v. US, Bear Mountainside, the plaintiff:

submitted a proposal in response to a solicitation by the General Services Administration (GSA) to lease space to the Internal Revenue Service (IRS). The GSA subsequently canceled the procurement, and the plaintiff filed this bid protest challenging the cancelation. The plaintiff thereafter filed a motion to supplement the administrative record. … The request to supplement the administrative record was granted with respect to specific emails among IRS employees and between IRS and GSA employees. The plaintiff had obtained these emails through a request under the Freedom of Information Act (FOIA).

Additionally, Bear Mountainside wanted to depose certain government officials at the IRS and GSA, including the GSA contracting officer. Before we joined this programming in progress, the court had denied the plaintiff’s motion for such discovery. This motion seeks reconsideration in light of new evidence.

The IRS lease award was apparently headed to Bear Mountainside when the IRS, in emails discovered through Bear Mountainside’s FOIA’s request, wrote, “The current Mountainside building is unacceptable to IRS. We will not agree to occupy this building if GSA runs a completive action.” GSA then canceled the procurement, citing the IRS’s independent decision to consolidate operations elsewhere.

The protester challenged the cancelation, alleging bad faith. Specifically, Bear Mountainside called the government liars. This is unusual, because government employees are presumed to act in good faith through a doctrine known as presumption of regularity: on the regular, they are presumed to be performing their jobs correctly or every nit picked will grind the gears of government to a halt.

So, Bear Mountainside had received email evidence indicating bad faith and filed this motion again requesting depositions. The court, however, was mostly unconvinced, pointing it remains unproven that the GSA contracting officer was aware of IRS’s dislike of the building, and even if it the KO were, everyone is entitled to an opinion. The court therefore again denied Bear Mountainside’s request for further discovery:

Depositions are intrusive and the prior opinion already referred to them as a “‘last resort.’” Depositions are particularly disfavored when they may touch on the edges of privileged areas that could provoke objections and directions to the witness not to respond; such objections could in turn lead to satellite litigation especially disfavored in bid protests that are meant to be resolved expeditiously. [internal citations omitted]

Instead, Bear Mountainside was allowed to ask IRS officials questions, including the following:

When did the IRS first inform GSA Contracting Officer Ms. Alanna Fitzpatrick about a change in IRS requirements which led to the cancellation of the Solicitation? Please identify the date(s) of the occurrence, describe the facts, and identify the persons involved.

Before GSA informed the IRS that Bear Mountainside was the lowest-priced technically acceptable offeror based upon initial offers and that GSA would likely award a lease to Bear Mountainside, did the IRS ever inform GSA of any change in IRS requirements related to the Solicitation? If so, please identify any/all occurrences, the date of each occurrence, describe the facts, and identify the persons involved.

The IRS had one week, until 17 August 2023, to respond. To be continued.

For the AI-generated version, read on

The COFC-Bear-Mountainside-Realty case exemplifies the difficulties and obstacles that contractors may confront when filing a bid protest. The plaintiff, Bear Mountainside Realty LLC, disputed the cancellation of a procurement by the General Services Administration (GSA) to lease space to the Internal Revenue Service (IRS). The plaintiff requested to depose certain government officials at the IRS and GSA, but the court denied the motion for such discovery. Nevertheless, the court granted the plaintiff’s motion for limited additional discovery, enabling them to submit specific interrogatories to the defendant.

From this case, contractors should learn the importance of comprehending the administrative record and the basis for the government’s actions before filing a bid protest. The administrative record is the foundation for any bid protest, so contractors must acquire and evaluate all relevant documents and information before initiating a protest. This way, contractors can better understand the government’s decision-making process and identify potential weaknesses in the government’s case.

Furthermore, contractors should recognize that discovery is a final option and should not be sought without a strong showing that the administrative record is insufficient to allow for meaningful judicial review. The court denied the plaintiff’s request for depositions and other forms of discovery, stressing that discovery should only be granted in limited circumstances. Contractors should explore all other methods of obtaining information before seeking discovery, as it can be expensive and time-consuming.

Lastly, when seeking additional discovery, contractors should concentrate on specific issues and restrict the scope of their requests to prevent unnecessary expenses and delays. In this case, the court granted the plaintiff’s motion for limited additional discovery, but only with respect to specific interrogatories related to the justification provided by the IRS to the GSA in support of its request to cancel the solicitation. Contractors should be careful when requesting additional discovery and make sure that they are tailored to the specific issues at hand.

To conclude, the COFC-Bear-Mountainside-Realty case emphasizes the difficulties and obstacles that contractors may face when filing a bid protest. Contractors should comprehend the administrative record, explore all other methods of obtaining information before seeking discovery, and be careful when requesting additional discovery. By doing so, contractors can improve their chances of success in bid protests and reduce unnecessary costs and delays.

The above summary was AI generated on 23 August 2023 at Jason Bakke’s request. This post is meant to illustrate human- vs. AI-generated content and should not be taken as legal advice or advice of any nature. Views expressed here are not necessarily those of the author or Chaedrol LLC.