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HARRIS CORP. v. UNITED STATES

February 19, 1986

HARRIS CORPORATION, Plaintiff,
v.
UNITED STATES OF AMERICA, et al., Defendants



The opinion of the court was delivered by: PARKER

 Barrington D. Parker, Senior District Judge:

 Plaintiff Harris Corporation ("Harris"), a disappointed bidder in a negotiated government procurement, challenges a contract awarded on December 23, 1985 by the Secretary, Department of the Army to the Magnavox Electronic System Company ("Magnavox"). Magnavox requested and was allowed to intervene as a defendant shortly after the complaint was filed. In a complaint filed on January 28, 1986, Harris seeks a declaratory judgment that the contract award violated applicable procurement laws and regulations, the terms of the solicitation, and thus was unlawful and void. Preliminary and permanent injunctive relief is also sought to enjoin continued performance on the contract and compelling the Secretary of the Army to cancel the contract with Magnavox. The plaintiff alleges that the proposal of Magnavox was not in accordance with the terms of the solicitation, that the defendants' evaluation was arbitrarily conducted in violation of procurement regulations, and that the contract award violated Federal Acquisition Regulations, 48 C.F.R. § 15.100 et seq. (1984), and the Competition in Contracting Act, 41 U.S.C.A. § 251 et seq. (West Supp. 1985).

 On January 29, 1986, a temporary restraining order was issued and was later extended to February 18, 1986. On February 12, 1986, the parties presented extensive oral argument on the plaintiff's motion for a preliminary injunction and the defendants and the intervenor's motions for summary judgment. The matter was then taken under advisement. The Court gave full consideration to the argument of counsel, their legal memoranda in support of and in opposition to the pending motions, the supporting documents and exhibits, and the deposition testimony of several key Army personnel involved in the procurement award. *fn1"

 BACKGROUND

 The Army's procurement called for the design, manufacture, and test of 15 engineering development models of ground-based satellite communications terminals, known as Single Channel Objective Tactical Terminal ("SCOTT"). The SCOTT program is a significant part of the national defense effort, allowing the Army to operate in a global satellite communications system, the MILSTAR EHF Satellite Communications System. The original Request for Proposal ("RFP") was issued in September 1983 by the United States Army Communications-Electronics Command ("CECOM"). That RFP called for production of a much larger number of terminals based on a model designed through other sources. In early 1985, CECOM determined that further research and development should be sought before entering into a large production contract, and in June 1985 the RFP was amended. The amendment changed the solicitation to one with more emphasis on research and development efforts. *fn2"

 Three companies, Harris, Magnavox, and Ford Aerospace, submitted proposals. Thereafter, during the procurement process, they engaged in discussions and negotiations with CECOM representatives. Five factors were identified in the RFP as major areas for evaluation. In order of importance, the factors were Technical Approach, Integrated Logistics Support ("ILS"), Management, Design to Unit Production Cost/Operations and Support Costs ("DTUPC"), and Price. *fn3" The Harris, Magnavox, and Ford Aerospace proposals were evaluated by a Source Selection Evaluation Board ("SSEB"), *fn4" a group of about thirty specialists divided into teams according to the five areas. The SSEB evaluators generated lengthy written evaluations of each element of the proposals. *fn5" In addition, they gave one of the following adjectival ratings to each factor, subfactor and element: superior, excellent, acceptable, capable of being made acceptable, or unacceptable. They also assigned a risk rating of low, moderate, or high to each element.

 After the evaluation of the initial proposals, the Contracting Officer arranged for and presided over discussions and negotiations with each offeror and conveyed requests for additional written information from the evaluators. As a result of these discussions and negotiations, revised proposals were submitted by the offerors. The SSEB then conducted intermediate evaluations of the revised proposals and further discussions ensued, based on those evaluations. In September 1985, after all negotiations were complete, the three competitors submitted Best and Final Offers ("BAFOs"). The SSEB performed a final evaluation and submitted its ratings to the Source Selection Advisory Council ("SSAC").

 The SSAC, chaired by Colonel Alan McCahan and consisting of six technical experts in fields relevant to the procurement, met in October 1985 to consider the three proposals and the evaluations prepared by the SSEB. It devised numerical ratings for each major factor from the SSEB's adjectival ratings of the proposals, based on a mathematical formula that reflected the weights given to the various factors and subfactors by the Evaluation and Award Plan ("Plan"). *fn6" The scores were made part of a report submitted on November 7, 1985 to Major General Robert D. Morgan, the Source Selection Authority ("SSA"). General Morgan issued a Memorandum of Decision on December 23, 1985, awarding the contract to Magnavox on the basis of his determination that its proposal offered the best value to the government. Harris became aware of the decision on December 27, 1985.

 Harris, which had proposed the lowest total price of the three offerors, immediately requested a debriefing from the government on the evaluation of its proposal. According to Harris employees, the Army representatives at the debriefing made various statements that called into question the fairness, impartiality, and presence of a rational basis for the evaluation process and contract award. The debriefing took place on January 14, 1986, beyond the date before which Harris could obtain an automatic stay of the contract award, under the Competition in Contracting Act, by filing a protest with the General Accounting Office. 31 U.S.C.A. § 3553 (d) (1). Because of the time constraints, Harris filed suit seeking declaratory and injunctive relief from this Court.

 ANALYSIS

 I

 THE MOTION FOR PRELIMINARY INJUNCTION

 Before granting a preliminary injunction, the Court must assess four factors: (1) whether the petitioner has a strong likelihood of prevailing on the merits; (2) whether the petitioner would be irreparably harmed by the denial of an injunction; (3) whether the injunction would substantially harm the interest of other parties to the proceeding; and (4) whether the injunction is in the public interest. Virginia Petroleum Jobbers Ass'n v. FPC, 104 U.S. App. D.C. 106, 259 F.2d 921, 925 (D.C. Cir. 1958); see also Washington Metropolitan Area Transit Commission v. Holiday Tours, Inc., 182 U.S. App. D.C. 220, 559 F.2d 841, 842-43 (D.C. Cir. 1977). From all that has been advanced in the legal memoranda and oral arguments of counsel, it appears that the first and fourth factors have been stressed and thus call for careful attention.

 A. The Merits of Plaintiff's Claims

 It is noted preliminarily that while our Circuit Court has long recognized that bidders have standing to challenge government procurement decisions, Scanwell Laboratories, Inc. v. Shaffer, 137 U.S. App. D.C. 371, 424 F.2d 859 (D.C. Cir. 1970), at the same time it has cautioned against unnecessary judicial intervention in the procurement process. Indeed, a narrow standard of review has been approved in government procurement litigation. The disappointed bidder

 
bear[s] a heavy burden of showing either that (1) the procurement official's decisions on matters committed primarily to his own discretion had no rational basis, or (2) the procurement procedure involved a clear and prejudicial violation of applicable statutes or regulations.

 Kentron Hawaii, Ltd. v. Warner, 156 U.S. App. D.C. 274, 480 F.2d 1166, 1169 (D.C. Cir. 1973); see also M. Steinthal & Co. v. Seamans, 147 U.S. App. D.C. 221, 455 F.2d 1289, 1301 (D.C. Cir. 1971). The Court must exercise with restraint its power to overturn procurement decisions and recognize the discretion of agency officials and the "strong public interest in avoiding disruptions in procurement." Id. at 1300. Under this exacting standard, the plaintiff Harris has failed to make a substantial showing that it is likely to ...


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