Dell Fed. Sys., L.P. v. United States

Dell Fed. Sys., L.P. v. United States

Opinion

 [*986]  Wallach, Circuit Judge.

After initially awarding a contract for computer hardware to original awardees including Dell Federal Systems, L.P. ("Dell"), Blue Tech, Inc. ("Blue Tech"), and Red River Computer Company ("Red River") (collectively, "Appellees"), the U.S. Department of the Army ("the Army") instituted a corrective action² to reopen procurement and conduct additional discussions with offerors. J.A. 7009 (Corrective Action). Appellees challenged the decision to institute corrective action before the U.S. Court of Federal Claims, which granted Appellees' cross-motions for judgment on the administrative record and permanently enjoined the Army from proceeding with its corrective action. See Dell Fed. Sys., L.P. v. United States, 133 Fed. Cl. 92, 107 (2017); see also J.A. 1 (Judgment).

Appellants HPI Federal, LLC ("HPI"), CDW Government, LLC ("CDW"), and the United States ("the Government") (collectively, "Appellants") appeal the opinion and order of the Court of Federal Claims. [**3]  We possess jurisdiction pursuant to 28 U.S.C. § 1295(a)(3) (2012). Because the Court of Federal Claims did not apply the proper legal standard and we determine the Army's corrective action was reasonable under that standard, we reverse.

Background

I. The Solicitation

In May 2016, the Army solicited proposals for indefinite-delivery, indefinite-quantity contracts for "commercial-off-the-shelf" computer hardware such as desktop computers, tablet computers, and printers under Solicitation No. W52P1J-15-R-0122 ("the Solicitation"). J.A. 1341; see J.A. 1339-87. The total estimated contract value was $5 billion over a ten-year period. J.A. 1341. While the Army anticipated "mak[ing] at least eight [contract] awards, with up to five reserved for small business[es]," J.A. 1341, the Solicitation left open the possibility that "the [Army] . . . may make as many, or as few, awards as deemed appropriate," J.A. 1384.

The Solicitation stated that the competition would be conducted in accordance with the procedures outlined in Federal Acquisition Regulations ("FAR") Part 15, "Contracting by Negotiation," and the Army would therefore award contracts to the lowest priced, technically acceptable offerors. J.A. 1384;  [**4] see FAR 15.101-2(a) (2015) (explaining that the "lowest price technically acceptable source selection process is appropriate when best value is expected to result from selection of the technically acceptable proposal with the lowest evaluated price"). The Solicitation further stated offerors would be evaluated based on "an integrated assessment of three evaluation factors" of "Technical Approach, Past Performance, and Price," and any  [*987]  relevant attendant sub-factors. J.A. 1385. To be considered for an award, the Solicitation required offerors to achieve an "'Acceptable' [rating] . . . for the Technical Approach and its two sub-factors and the Past Performance [f]actor." J.A. 1385. For the two Technical Approach sub-factors, offerors were required to complete an attached "Equipment Submission Form" and "Business Process Form" in Microsoft Excel. J.A. 1381-82; see, e.g., J.A. 1388-421 (Equipment Submission Form spreadsheet template), 1422-25 (Business Process Form spreadsheet template). For the Equipment Submission Form, offerors were instructed to "complete all cell entries" and "identify the Original Equipment Manufacturer (OEM)[] model and salient characteristics of each proposed item," and were [**5]  advised that "[a]n incomplete or blank entry will indicate that the proposed item does NOT meet minimum requirements." J.A. 1382.

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