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Cheeks v. Fort Myer Construction Co.

June 25, 2010

JOHN C. CHEEKS, PLAINTIFF,
v.
FORT MYER CONSTRUCTION COMPANY, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Colleen Kollar-kotelly United States District Judge

MEMORANDUM OPINION

Plaintiff John C. Cheeks ("Cheeks") filed this action pro se seeking relief for injuries allegedly suffered from a bid-rigging conspiracy in which his company, Cheeks of North America, Inc. ("CNA"), lost construction contracts to competitors who conspired against him in the bidding process. Named as defendants in this action are four of those competitors (Fort Myer Construction Corporation, Anchor Construction Corporation, Civil Construction, LLC, and Capitol Paving of D.C., Inc.); their officers (Francisco R. Neto, Jose Rodriguez, Lewis Shrensky, Cristina Gregoria); their guarantor and its officer (Western Surety Company and Paul T. Bruflat); the District of Columbia Water and Sewer Authority's Procurement Department, Board of Directors, and Retail Services Committee and various individuals associated therewith (Avis Russell, Jerry Johnson, Guss Bass, John Christodoulakis, Carlo Enciso, William M. Walker, Neil Albert, Daniel M. Tangherlini, F. Alexis H. Roberson, Alan J. Roth, Keith M. Stone, David J. Bardin, Brenda Richardson, Joseph Cotruvo, and Howard Gibbs); the D.C. Department of Transportation's Office of Contracting and Procurement and its officers (David P. Gragan, Jerry M. Carter, Gabe Klein); the D.C. Department of Transportation's Infrastructure Project Management Administration and its program manager (Said Cherifi); the D.C. Department of Public Works's Office of Contracting and Procurement and its contracting officers (Tara Sigimoni and James Roberts); the D.C. Council Committee on Public Works and Transportation and its members and staff (Jim Graham, Kwame R. Brown, Muriel Bowse, Phil Mendelson, Tommy Wells, Steven Hernandez, Jonathan Kass, and John DeTaeye); the Executive Office of the Mayor of D.C.; and D.C. Mayor Adrian M. Fenty.

All but one of the defendants has entered an appearance in this matter, and one of the defendants (Fort Myer Construction Corporation) is in default. Presently pending before the Court are a series of dispositive and nondispositive motions, including motions to quash service of process and motions to dismiss the Complaint. As explained below, the Court finds that the claims asserted in Counts One through Seventeen of the Complaint are based on injuries to CNA and that Cheeks lacks standing to assert those claims on his own. Because the lack of standing deprives the Court of subject matter jurisdiction, the Court must dismiss Counts One through Seventeen of the Complaint against all defendants. The Court also finds that the remaining claims asserted in the Complaint for alleged constitutional deprivations fail to state a claim upon which relief can be granted. Although some defendants did not move to dismiss these remaining claims, the Court finds that the allegations in the Complaint clearly fail to state a claim and may be dismissed against the other defendants sua sponte. Therefore, the Court shall set aside the default against Fort Myer Construction Company and dismiss the Complaint in its entirety.

I. BACKGROUND

A. Facts Alleged in the Complaint

Plaintiff John C. Cheeks is Chief Executive Officer of Cheeks of North America, Inc. ("CNA"). Compl. ¶ 38. Cheeks is one of the founders and the owner of CNA, and he is engaged primarily in industrial services, infrastructure improvements, professional consulting of alternative fuels and energy systems, and strategic business development. Id. ¶ 4. Cheeks also serves as CNA's Senior Project Estimator and has the responsibility for assembling cost estimates for competitive project bids submitted by CNA. See id. ¶¶ 43-45. During 2008 and 2009, Cheeks participated in five solicitations for bids issued by contracting agencies: three issued by the District of Columbia Water and Sewer Authority ("WASA"), one issued by the District of Columbia Department of Transportation ("DDOT"), and one issued by the District of Columbia Department of Public Works ("DPW"). Id. ¶¶ 39-42.

1. WASA IFB No. 080020

On August 20, 2008, Cheeks submitted a bid for CNA in response to WASA's Invitation for Bid ("IFB") No. 080020, entitled "Replacement of Small Diameter Priority Water Mains for 2008 Construction." See Compl. ¶ 48 & Ex. D.7.1 (Bid Submission Form). Cheeks proposed that CNA would furnish all plant, labor, materials, and equipment to perform the work set forth in the IFB for $11,154,500, and he submitted a bid bond in the amount of $557,725 via company checks. See id. ¶ 48 & Exs. D.7.2 (Bid Bond), D.7.5 (Checks). On the afternoon of August 20, 2008, WASA procurement officer Carlo Enciso opened the bids that were received. Id. ¶ 50. Among the other bidders were Defendants Civil Construction, LLC ("Civil Construction"), Anchor Construction Corporation ("Anchor"), Fort Myer Construction Corporation ("Fort Myer"), and Capitol Paving of D.C., Inc. ("Capitol Paving"). See id. ¶ 51 & Ex. D.9.1 (Bid Tabulation Sheet). Cheeks alleges that Defendant Western Surety Company ("Western Surety") issued guaranteed bid bonds on behalf of these other bidders. See id. ¶ 50. CNA's bid was the lowest of the eight bids received and was announced as the lowest bidder. Id. ¶ 51 & Ex. D.9.1.

On September 9, 2008, Cheeks received a letter from WASA Contracting Officer Jerry Johnson informing him that the bid submitted on August 20, 2008 had been deemed non-responsive and therefore was not eligible for award. Id. ¶ 53 & Ex. H.1.1 (Sept. 9, 2008 letter). The rejection letter informed Cheeks that "[e]lements considered in this decision were that your bid did not include a completed Bid Bond with sureties or certified check[s] for five percent (5%) of the bid amount." See id.,Ex. H.1.1. On September 30, 2008, Cheeks filed a Bid Protest with WASA requesting "equitable allotted time to reissue the bid bond to DC WASA." Id. ¶ 54 & Ex. K.1.1-2 (Bid Protest). On October 23, 2008, WASA Director of Procurement John P. Christodoulakis issued a letter stating the Contracting Officer's decision rejecting Cheeks's bid protest. See id., Ex. K.1.4-5 (Oct. 23, 2008 letter). The letter stated that Cheeks's bid protest was untimely filed and that the bid was properly rejected for failure to include bond security. Id. On November 6, 2008, the WASA Board of Directors gave approval to award Contract No. 080020 to the next lowest bidder, Anchor Construction Corporation. Id. ¶ 55 & Ex. G.1.11 (Nov. 6, 2008 Resolution).

2. WASA IFB No. 090080

On March 25, 2009, Cheeks submitted a bid for CNA in response to WASA's IFB No. 090080, entitled "Sanitary Sewer Lateral Replacements." See Compl., Ex. D.9.2 (Bid Tabulation Sheet). The amount of the bid was listed on the bid call sheet as $11,298,320, which was the highest of the seven bids received. See id. On March 29, 2009, Cheeks filed a Bid Protest indicating that CNA's actual base bid (after deduction of contingent items) was $5,040,000, making it the lowest of the seven bids received. See Compl., Ex. K.2.1-2 (Bid Protest). WASA allegedly failed to respond to Cheeks's bid protest. Id. ¶ 57. The contract was ultimately awarded to the original low-bidder, Corinthian Contractors. See Compl., Ex. D.1.10 (WASA Executed Construction Contract Summary). The other bidders included Defendants Fort Myer, Anchor, Civil Construction, and Capitol Paving. See id., Ex. D.9.2.

3. WASA IFB No. 090020

On April 1, 2009, Cheeks submitted a bid for CNA in response to WASA's IFB No. 090020, entitled "Fire Hydrant Replacement Contract 4." See Compl., Ex. D.7.3 (Bid Form). The amount of the bid was $2,817,600, and Cheeks submitted a bid bond for $140,880 with corporate checks. Id., Ex. D.7.4-5 (Bid Bond, checks). The other bidders included Defendants Fort Myer, Civil Construction, Capitol Paving, and Anchor. Id., Ex. D.9.3 (Bid Tabulation Sheet). The contract was ultimately awarded to the lowest bidder, Nastos Construction, Inc. See id.; id.,Ex. D.1.10 (WASA Executed Construction Contract Summary).

4. DPW IFB No. DCKT-2009-B-0003

Cheeks submitted a bid for CNA in response to DPW's IFB No. DCKT-2009-B-0003, entitled "On-Site Preventive Maintenance Services." See Compl., Ex. D.11.1 (Bid Tabulation Sheet). The total amount of the bid was $3,639,901, and it was the lowest bid received when the bids were opened on December 29, 2008. See id. On December 30, 2008, DPW Contracting Officer James Roberts sent a letter by fax to Cheeks explaining that the low bidder is not automatically awarded a contract and that contractors must demonstrate responsibility for the project; the letter asked Cheeks to provide certain background information about finances and operations. See id., Ex. D.19.1-4 (Dec. 30, 2008 letter). Cheeks faxed a letter to Roberts requesting additional time to provide this information, and Roberts allowed Cheeks to have two additional days. See id. ¶ 287. However, Cheeks apparently was unable to provide sufficient information in time for DPW.*fn1

5. DDOT IFB No. DCKA-2009-B-0025

Cheeks submitted a bid for CNA in response to DDOT's IFB No. DCKA-2009-B-0025, entitled "Pavement Restoration City-Wide." See Compl., Exs. D.8.1 (Bid Form) & D.10.3 (Bid Tabulation Sheet). The sealed bid opening was held on March 18, 2009. Compl. ¶ 297. The sixth amendment to the IFB was emailed to Cheeks on March 16, 2009. Id. In order to strategically compete for the contract, Cheeks had to readjust the bid. Id. ¶ 299. The amount of the bid was $54,252,805. See Compl. ¶ 42.*fn2 This was the lowest bid reflected on the Bid Tabulation Sheet. See id., Ex. D.10.3. The other bidders included Defendants Fort Myer and Capitol Paving. Id. DDOT's Contracting Officer, Jerry M. Carter, had concerns with the type of bid guarantee submitted by Cheeks and denied Cheeks time to resubmit his bond form. Id. ¶¶ 302-03. Cheeks's bid was rejected by letter from Jerry M. Carter dated May 27, 2009. Id. ¶ 306.*fn3 Cheeks filed a Bid Protest on behalf of CNA. See id., Ex. K.4.4-5 (Bid Protest).

Cheeks alleges that two of other bidders, Fort Myer and Capitol Paving, have shared ownership or family relations. See Compl. ¶ 304.

B. Claims Asserted in the Complaint

Cheeks asserts 18 counts in his Complaint, which the Court shall summarize below. Cheeks prays for relief in the form of damages in the amount of $1,778,010,862.95. See Compl. ¶ 383.

1. Counts One, Two, Three, Four, Five, Seven, Eleven, Twelve, and Thirteen: Antitrust Violations for Bid-Rigging Conspiracy

The first four counts in the Complaint are asserted against Defendants Fort Myer, Anchor, Civil Construction, Capitol Paving, and three individuals who are officers of one or more of these companies: Francisco Rodriguez Neto ("Neto"), Jose Rodriguez ("Rodriguez"), and Lewis Shrensky ("Shrensky"). See Compl. at 25, 30, 35, 37. Rodriguez is alleged to be a Director of Anchor, principal owner of Fort Myer, and principal manager of Civil Construction. Id. ¶ 71. Shrensky is alleged to be the Secretary, Treasurer, Director and Registered Agent of Fort Myer and a principal manager of Civil Construction. Id. ¶ 73. Neto is ...


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