The opinion of the court was delivered by: GASCH
Presently before the Court is plaintiff's motion for preliminary injunction restraining the performance of a contract awarded by the Department of Agriculture for the procurement of near-infrared reflectance ("NIR") instruments. Plaintiff requests the injunction until GAO rules on its protest regarding the Invitation for Bids ("IFB") underlying the contract and until the Court can consider the merits of plaintiff's claim. Plaintiff alleges that the IFB violated procurement statutes and regulations because it contained unnecessarily restrictive specifications that prevented plaintiff from bidding for the contract. The contract was awarded to Neotec, Inc., on December 30, 1977, and specifies that ninety-five NIR instruments be delivered by February 1, 1978, for use by the Federal Grain Inspection Service ("FGIS").
Plaintiff filed its complaint on December 28, 1977, seeking temporary and permanent injunctive relief against the opening of bids and subsequent award of the contract. The complaint also requests a declaration that the IFB violates applicable procurement law. Plaintiff's motion for a temporary restraining order was denied on December 28, and bids were opened revealing Neotec as the sole bidder. On December 29, 1977, plaintiff's motion for a temporary restraining order against award of the contract was denied. The contract was awarded to Neotec on December 30, and plaintiff filed its motion to restrain performance of the contract on January 5, 1978. The Court granted Neotec's motion to intervene as a defendant on January 5, and argument was heard on plaintiff's motion the following day in open Court.
For the reasons set forth briefly below, the Court concludes that plaintiff's motion for a preliminary injunction should be denied.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
On December 5, 1977, the Agricultural Marketing Service of the Department of Agriculture issued IFB No. 2-AMS-78(W) for the procurement of ninety-five NIR instruments. The instruments measure the protein content in wheat. The IFB specified that all ninety-five units must be delivered by February 1, 1978. It also specified that the instruments must have an eight wavelength capability, six wavelengths for the measurement of protein and moisture and two more wavelengths for the measurement of oil.
The NIR instruments were procured for the use of the FGIS, and defendants have submitted affidavits explaining that the specifications reflected the minimal needs of FGIS.
FGIS is responsible for the establishment of standards for grain and the development of procedures for the inspection of grain.
For the past several years, FGIS has been evaluating NIR devices for the measurement of protein content in grain. In May, 1977, the Service decided that the infrared testing technique would be implemented on May 1, 1978.
In line with this decision, FGIS began drafting during July, 1977, specifications for the procurement of NIR devices. The February 1, 1978, delivery date was deemed necessary to ensure that the program could be fully implemented by May 1. The FGIS determined that two months were necessary for the training and licensing of employees who would use the devices and that a third month would be necessary as a dry-run period for locating and eliminating problems in the system.
The eight wavelength specification was included because the agency wanted a device capable of using the so-called "new-math" methodology that had been revealed to the industry in October, 1977. This methodology is capable of accurate protein measurements at low moisture levels and also is less sensitive to particle size.
FGIS, concluding that the "new math" procedure constituted a vastly improved protein measurement methodology, decided that the program implemented on May 1, 1978, should have the "new math" capability. When the IFB was issued, an eight wavelength instrument was the only means known for using the new methodology,
and thus the eight wavelength specification was included in the IFB.
Following review of the specifications drafted by FGIS, the contracting officer in the Department of Agriculture determined that a competitive IFB was justified because at least three possible sources for the procurement existed. These sources included: (a) Neotec, which eventually was awarded the contract; (b) plaintiff Dickey-john, which did not bid because it could not meet the February 1 delivery date for all items required, and (c) Technicon Corporation, which markets an NIR device produced by Dickey-john and which also did not bid because its device lacked the eight wavelength capability. The bid opening on December 28, twenty-three days after the issuance of the IFB, revealed Neotec as the sole bidder. After plaintiff's efforts to obtain a temporary restraining order failed, the contract was awarded to Neotec on December 30, and delivery of some of the units had already occurred at the time of the Court's hearing on January 6.
Plaintiff's motion for a preliminary injunction must be measured against the principles enunciated in Virginia Petroleum Jobbers Association v. FPC, 104 U.S. App. D.C. 106, 259 F.2d 921 (1958). Four factors should be considered in determining whether preliminary injunctive relief is appropriate: the irrepairability of injury to plaintiff in the absence of the injunction; the likelihood that plaintiff will prevail on the merits; the degree of harm to other parties as a result of the injunction; and the effect on the public interest of the Court's action. See 259 F.2d at 925. The Court concludes that the facts of the instant action do not justify preliminary injunctive relief.
I. Existence of Irreparable Injury.
Plaintiff claims that it will be irreparably injured if performance of the contract is not enjoined pending GAO's consideration of plaintiff's bid protest and the Court's hearing of plaintiff's complaint on its merits. Plaintiff urges that performance must be enjoined if the merits of its claim are not to become moot. Plaintiff argues that unless the Court considers its complaint on the merits and orders resolicitation under a rewritten IFB lacking the specifications that kept plaintiff from submitting a responsive bid, plaintiff will be effectively shut out from the expanding market for NIR devices. Plaintiff maintains that federal and state agencies will follow the lead of FGIS in selecting Neotec's device, with its particular specifications for protein measurement.
Plaintiff, however, cites another form of irreparable injury that will occur unless the Court enjoins performance and preserves the possibility of ordering resolicitation as a remedy after a decision on the merits. Plaintiff correctly notes that its action for money damages as a disappointed potential bidder would not include recovery of lost profits, but would be limited to recovery of bid preparation costs. Thus, plaintiff's only adequate remedy for being improperly denied the opportunity to submit a responsive bid is a chance to bid after resolicitation. This argument, however, is not sufficient by itself to justify a preliminary injunction; the Court should not ...