Non-incumbent awardees who are defending their awards against a bid protest often view sole-source “bridge” contracts issued to the incumbent as something akin to death and taxes — an unpleasant, yet seemingly inescapable fact of life. But a recent Court of Federal Claims decision offers an important reminder that these types of contracts are not inviolate. They can be successfully protested themselves when the need to sole-source arises from a lack of advance planning on the part of the agency.
Global-Dynamics, LLC v. United States, No. 17-1875C, __ Fed. Cl. __, 2018 WL 2016151 (May 1, 2018) has a lengthy procedural history. The Army issued the solicitation in 2012 seeking registered nursing (“RN”) services for the San Antonio Military Healthcare System. Since then, the agency has made award to protester Global-Dynamics three times; disappointed offeror GiaMed (a joint venture of the incumbent MedTrust and another entity) has successfully protested three times; and the Army has awarded MedTrust five sole-source bridge contracts.
Most recently, the Army made award to Global-Dynamics in June 2016. Following a successful Government Accountability Office (“GAO”) protest by GiaMed, the Army advised that it would be able to implement GAO’s recommended corrective action within 120 days (i.e., by April 29, 2017). On May 11, 2017, the Army told GAO that it expected to complete the corrective action within another 45 days (i.e., by June 25, 2017). The corrective action was still ongoing 117 days later (i.e., on September 5, 2017), however. That day, the Army announced its plan to award the fifth sole-source bridge contract to MedTrust while the corrective action was pending.
Plaintiff protested on the ground that the sole-source award violated the Competition in Contracting Act (“CICA”). Citing Innovation Development Enterprises of America, Inc. v. United States, 108 Fed. Cl. 711 (2013) (sole-source award violates CICA because it is based on agency’s lack of advance planning), the Court of Federal Claims sustained the protest, concluding that the bridge contract was necessitated by the Army’s lack of advance planning, which is not an adequate justification for a sole-source award.
The Court rejected as inadequate each of the Army’s three explanations for why it was taking so long to complete the corrective action. First, the Court explained that the retirement of three of the five contracting officers available to implement GAO’s recommendations did not excuse the delay because there was no reason to believe the retirements were sudden or unexpected, or that the Army could not fill the resulting vacancies. The Court further pointed out that the Army was presumably aware of the pending retirements when it set the 120-day corrective action schedule in December 2016.
Second, the Court found unpersuasive the Army’s claim that the corrective action was delayed because the agency had to divert resources to address unrelated matters. The Court noted that the Army did “not explain why these other matters needed to be prioritized over resolving the issues relating to the contract for nursing services[.]”
Finally, the Court opined that the Army’s contention that its requirement for RNs increased in July 2017 could not justify the delay because the agency had already missed the April 29, May 11, and June 25 deadlines before the requirements allegedly increased.
Thus, as Global Dynamics demonstrates, challenging sole-source bridge contracts is not an exercise in futility. When the evidence suggests that an agency’s lack of advance planning may have led to the sole-source award, contractors should strongly consider filing a bid protest in the Court of Federal Claims.