[00:00:00] Speaker 00: Thank you. [00:00:05] Speaker 03: Our next case for argument is 21-1556, Michko International versus the United States. [00:00:12] Speaker 03: Mr. Grayson, please proceed. [00:00:16] Speaker 08: Thank you very much. [00:00:17] Speaker 08: Thank you all to you, Judge and judges, especially for the courtesy and consideration of allowing me to do this argument. [00:00:26] Speaker 08: I'm Alan Grayson. [00:00:27] Speaker 08: I'm here on behalf of Alan Michko. [00:00:29] Speaker 08: I'm going to begin by addressing the mootness issue and the irreparable injury issues because I think that they open the door to the remaining issues. [00:00:38] Speaker 08: The key to understanding the mootness issue and the irreparable injury issue is found at the solicitation, in this case on page 87, which is in the record at page 1,465. [00:00:53] Speaker 08: The government committed in the solicitation as follows. [00:01:01] Speaker 08: is deemed responsible in accordance with FAR, whose proposal conforms to the solicitation requirements, and his proposal, judged by an overall assessment of the evaluation criteria and other considerations specified in the solicitation, represents the lowest price technically acceptable offer. [00:01:21] Speaker 03: Council, this is Judge Moore. [00:01:22] Speaker 03: It's not your position, is it, that the government is never permitted to withdraw or cancel a solicitation. [00:01:30] Speaker 08: No, but if they had done that, that does not happen, Your Honor. [00:01:34] Speaker 03: Right. [00:01:34] Speaker 03: So the government can... And in my personal experience, I've seen the government put out solicitations and not get any bids to which they're satisfied and then pull it back and then issue a new solicitation later on. [00:01:48] Speaker 03: Is that also a practice that you're familiar with? [00:01:52] Speaker 08: Yes, Your Honor. [00:01:53] Speaker 08: I am familiar with that. [00:01:55] Speaker 03: So I guess I'm trying to figure out what's going on in this case. [00:01:58] Speaker 03: In your brief and a footnote, you kind of suggested the government has not, in fact, canceled this solicitation. [00:02:04] Speaker 03: But then somewhere in their brief, I thought they alleged there was no longer a contract or a solicitation. [00:02:11] Speaker 03: So what I can't figure out is, where do things stand right now as a factual matter? [00:02:18] Speaker 08: There is an outstanding solicitation. [00:02:21] Speaker 08: It has not been canceled, Your Honor. [00:02:23] Speaker 08: If it were canceled, it would be canceled by an amendment issued through Walla Feroz. [00:02:27] Speaker 08: There has been no such amendment. [00:02:29] Speaker 08: What's happened is that the contract that was wrongly issued to the competing company, Kover, has been terminated. [00:02:37] Speaker 08: That's where things stand concerning Kover's contract. [00:02:40] Speaker 03: Well, yes, but this is for food service, right? [00:02:45] Speaker 03: I mean, we can't have an army base with no food. [00:02:47] Speaker 03: So a contract is going to have to be awarded at some point. [00:02:51] Speaker 03: Is that right? [00:02:53] Speaker 00: Yes. [00:02:53] Speaker 03: And do you believe that contract, are you, is it your company's position that that contract is going to be awarded or your belief that it's going to be awarded by virtue of the bids that were submitted and are pending in light of the current non-cancelled solicitation? [00:03:11] Speaker 08: Absolutely, Your Honor. [00:03:12] Speaker 08: That's correct. [00:03:13] Speaker 08: Michigan was next in line for award that is disputed. [00:03:16] Speaker 03: Well, but there were, well, when you say next in line, there were, I, [00:03:20] Speaker 03: Please, somebody jump up if I say something I'm not supposed to. [00:03:25] Speaker 03: But I believe I understand there were five submissions and three deemed acceptable or that crossed a particular hurdle. [00:03:33] Speaker 03: I'm trying to speak in ambiguities so that I don't mess up anything that might be confidential. [00:03:37] Speaker 03: Is that accurate what I'm saying? [00:03:40] Speaker 03: Is that accurate? [00:03:42] Speaker 03: Yes. [00:03:44] Speaker 03: So if you think there's an open solicitation and if the government is right now considering which of the bidders to award the contract to, then isn't some of the forms of relief that you've sought in your complaint now premature? [00:04:02] Speaker 03: Forget about mootness. [00:04:04] Speaker 03: Aren't some of them premature like you wanted your bid preparation costs? [00:04:09] Speaker 03: Well, you're still in the running for a contract you very well might get. [00:04:12] Speaker 08: So why would... No, Your Honor, there's... I'm sorry to interrupt. [00:04:15] Speaker 03: Oh, please, go ahead. [00:04:16] Speaker 03: Explain to me the facts. [00:04:18] Speaker 08: There is no evidence that the government is actively considering an award to Michko or anybody else. [00:04:23] Speaker 08: Michko was in line for award because it's lowest price technically acceptable. [00:04:28] Speaker 08: Michko was determined to be lowest priced other than Kover and technically acceptable among the offerors. [00:04:34] Speaker 08: But there is a complete lack of interest on the part of the government right now to proceed with the procurement. [00:04:40] Speaker 08: And that's unfortunate. [00:04:41] Speaker 08: That's why we need to have court information. [00:04:43] Speaker 03: OK, so this is what I don't understand. [00:04:45] Speaker 03: It's food service. [00:04:47] Speaker 03: These people have to eat. [00:04:49] Speaker 03: So how can you say there's no interest in providing a contract? [00:04:52] Speaker 03: Because doesn't the government sort of have to get a contract in place in order for people to eat? [00:04:57] Speaker 08: The government has arranged for a short-term contract under a separate logistics contract that covers logistical services [00:05:09] Speaker 08: that include food, apparently. [00:05:13] Speaker 08: So there's a short-term fix in place, like a bridge contract. [00:05:16] Speaker 03: And that's not, is that to Michko? [00:05:18] Speaker 08: No, it's not. [00:05:19] Speaker 03: Okay, it's to somebody else. [00:05:20] Speaker 03: So there's a short-term bridge contract in place, but it's your understanding that that only exists until December? [00:05:27] Speaker 08: No, I'm not sure how long it exists, Your Honor, but there's been no movement at all toward going back and making an award to Michko as the next in line for [00:05:37] Speaker 08: award under the original solicitation. [00:05:40] Speaker 07: What would happen here if the government had canceled the solicitation entirely? [00:05:45] Speaker 07: Would that move the entire case, including the request for bid preparation costs? [00:05:52] Speaker 08: It would not move the request for bid preparation costs at all, Your Honor. [00:05:57] Speaker 08: That's exactly when we would be entitled to bid and proposal preparation costs. [00:06:01] Speaker 08: But the answer to your question, Your Honor, is that we would protest that. [00:06:05] Speaker 08: If there were a cancellation, we would protest that. [00:06:07] Speaker 08: That would not be appropriate action by the government at this point. [00:06:10] Speaker 08: We're next in line for a word. [00:06:11] Speaker 08: They should just go ahead and do it. [00:06:15] Speaker 07: If they cancel the solicitation, the claim for equitable relief would become moot, wouldn't it? [00:06:26] Speaker 08: I think at that point, we would have to file a protest against the cancellation. [00:06:32] Speaker 08: So the answer to your question, Your Honor, is yes, with that caveat. [00:06:38] Speaker 03: So, I mean, government can't avoid normal contract procurement process, i.e. [00:06:45] Speaker 03: solicitation and evaluation of bids, by extending a short-term contract indefinitely. [00:06:51] Speaker 03: Is that right? [00:06:52] Speaker 08: That's exactly why we're here today, Your Honor. [00:06:56] Speaker 08: That is exactly correct. [00:06:57] Speaker 08: We need to go ahead and finish the job. [00:07:00] Speaker 03: What if they were to cancel the solicitation and issue a new solicitation allowing other contractors to submit bids? [00:07:10] Speaker 03: How would that affect your case? [00:07:14] Speaker 08: That would mean that we would protest that action, probably in a separate action, Your Honor. [00:07:21] Speaker 08: We would stand by our request for proposal preparation costs in this action. [00:07:26] Speaker 08: And in that, actually, the argument that was arbitrary, capricious, and contrary to law, because a federal statute regulates the cancellation of solicitations, does not apply and authorize that in this situation. [00:07:38] Speaker 08: And the government can't cancel without a good cause. [00:07:42] Speaker 08: That would be a bad faith cancellation, if you will, since Mitchell is ready, willing, and able to do the work, and is next in line. [00:07:50] Speaker 07: But that would be a different case. [00:07:53] Speaker 08: Yes, but the cancellation has not happened yet, Your Honor, but that would be a different case. [00:08:02] Speaker 03: In order for you to get your bid preparation costs, don't you have to establish that you were meritorious in your bid protest? [00:08:12] Speaker 03: I mean, as of now, the contract to KOVR has been [00:08:18] Speaker 03: canceled or they were in breach, but not for the reasons that you argued ought to have resulted in you getting the award as opposed to them. [00:08:27] Speaker 03: It was independent of those reasons. [00:08:31] Speaker 03: So in order for you to get your bid proposal or bid preparation costs, don't you have to establish being correct on the merits? [00:08:42] Speaker 08: Yes, Your Honor. [00:08:44] Speaker 08: And in fact, Your Honor is exactly correct. [00:08:46] Speaker 08: What's happened is that [00:08:47] Speaker 08: Under 13 CFR, Section 121.1009 G2I, the government was required to terminate the award to covert. [00:08:58] Speaker 08: It did terminate the award to covert belatedly and for a different reason. [00:09:02] Speaker 08: So in fact, what we were asking to happen here has happened here. [00:09:08] Speaker 08: There has been a termination under that particular merits argument, but the government doesn't concede it was for that reason. [00:09:13] Speaker 08: The government claims it was for a different reason. [00:09:15] Speaker 08: And there are other merits arguments that we made that would justify the proposal of preparation costs for Iran. [00:09:22] Speaker 03: But I don't understand. [00:09:23] Speaker 03: If the government canceled the contract for a reason that differs from the reasons that you were arguing it should never have been awarded in the first place, then why would you be entitled to your big preparation costs? [00:09:36] Speaker 08: I think we, well, if that were the case, I think that we wouldn't be. [00:09:41] Speaker 08: But that's not the case. [00:09:42] Speaker 08: We were correct on the merits. [00:09:43] Speaker 08: here regarding Section 121.1009. [00:09:48] Speaker ?: The words mean nothing. [00:09:50] Speaker ?: There is no contradiction between that SBA regulation and the Randall-Shepard Act minor preference that's given to Cobra. [00:09:58] Speaker 08: So if the court were to determine that you're right on that issue or any of the other three merits issues that raise on the appeal, we would be entitled to our proposal. [00:10:06] Speaker 03: So is it your view that in order for us to reach [00:10:10] Speaker 03: the whether or not you're entitled to your bid preparation costs, we first have to reach the completely moot issues of whether KOVR should have been awarded the contract in the first place? [00:10:25] Speaker 08: I would not say that they're completely moot. [00:10:29] Speaker 03: They have to be moot. [00:10:30] Speaker 03: Council, they have to be moot. [00:10:31] Speaker 03: KOVR doesn't have a contract anymore. [00:10:33] Speaker 03: They're out of it. [00:10:34] Speaker 03: So whether they should have been awarded the contract or not is a moot issue because there's no more contract for them. [00:10:40] Speaker 03: So is it your view that I have to reach an issue like that, that I think is moot, whether or not the lower tribunal erred in deciding that it was not improper to award it to KOVR. [00:10:59] Speaker 03: I have to go through all of those merits of what I think is a moot issue in order to reach the question of whether you should be entitled to your bid protest. [00:11:09] Speaker 08: This is not rude. [00:11:14] Speaker 08: The board has not been made to Michko. [00:11:16] Speaker 08: Only if a board were made to Michko would anything be rude in this case. [00:11:20] Speaker 03: Well what's Moot is whether or not the government should have awarded it to KOVR in the first place because the contracts gone and KOVR is gone. [00:11:28] Speaker 03: So whether they should have awarded it to them is Moot and that was your argument upon which you predicated in large part your bid proposal cost request. [00:11:38] Speaker 03: So what I'm trying to figure out is since [00:11:41] Speaker 03: The contract hasn't been awarded to anyone. [00:11:44] Speaker 03: Do you really have any basis for bid proposal costs? [00:11:47] Speaker 03: Because that bid may still very well be active, may still result in you getting an award for the contract. [00:11:54] Speaker 03: So it would seem quite odd if we were to suggest you were entitled to bid proposal costs and that a month later the government actually awarded you the contract on the basis of the very bid that we just gave you a proposal cost for. [00:12:05] Speaker 03: Do you see my problem? [00:12:07] Speaker 08: I do, Your Honor, but I think that's counterfactual. [00:12:10] Speaker 08: There is no indication that the government is giving any active consideration right now to an award to Mexico, and that is the nub of the problem at this point. [00:12:20] Speaker 07: I think there are two separate issues as to mootness. [00:12:22] Speaker 07: One is mootness of the equitable relief that is your right to the award, and the other one is the bid preparation cost. [00:12:33] Speaker 00: Yes, Your Honor, that's correct. [00:12:35] Speaker 07: There would be an issue as to bid preparation costs whether or not the contract was canceled because you incurred these bid preparation costs in the course of challenging the award to cover. [00:12:52] Speaker 08: That is correct. [00:12:53] Speaker 08: I would say that if awards were made tomorrow, we would no longer have a valid request for bid proposal and preparation costs. [00:13:00] Speaker 08: We would have a valid request [00:13:02] Speaker 08: under the Equal Acts of Justice Act for attorney's fees, but that's a separate matter. [00:13:09] Speaker 07: Would you all like to understand that? [00:13:10] Speaker 07: The Equal Acts of Justice Act attorney's fees can't prevent it from becoming moot. [00:13:14] Speaker 07: It would only be bid preparation costs. [00:13:18] Speaker 08: That is my understanding of the precedent, John. [00:13:21] Speaker 08: I agree with that statement. [00:13:24] Speaker 08: Would you all like me to address the merits issues in this case? [00:13:28] Speaker 08: It seems like the court is focused on the issue [00:13:31] Speaker 08: of what's left to decide, and I would simply read it in that regard, that we're in a situation where, as the courts pointed out, food is still being served to the troops at Fort Knox, and it's not being done by Michigan. [00:13:45] Speaker ?: If Fort Knox were to close, in this case, it would be moot. [00:13:48] Speaker 08: If food were not only provided by the army of soldiers, in this case, it would be moot. [00:13:52] Speaker 08: Neither one of those two things happened. [00:13:54] Speaker 08: And the Army is stuck not making any movement toward making awards to Michiko at this point. [00:14:00] Speaker 08: So the case is not moving in any real sense as far as Michiko is concerned. [00:14:04] Speaker 07: I have a question about the PIA argument. [00:14:06] Speaker 07: Let's assume you're right on the statutory construction, and it applies to persons other than government employees. [00:14:13] Speaker 07: I'm not understanding how the act was violated on that theory. [00:14:19] Speaker 07: I mean, certainly Koper had a right to this invoice. [00:14:24] Speaker 07: which you say was improperly in their possession. [00:14:27] Speaker 07: I don't understand how an invoice for work under another contract can somehow be a violation of the PIA. [00:14:38] Speaker 08: I'm sorry, but I couldn't hear the question clearly, Your Honor. [00:14:41] Speaker 07: I apologize. [00:14:41] Speaker 07: Okay. [00:14:43] Speaker 07: I'm asking about the PIA violation. [00:14:46] Speaker 07: I'm saying, assuming you're right on the statutory construction, that it applies to persons other than government officials, [00:14:54] Speaker 07: How is it that the Act was violated here? [00:14:56] Speaker 07: This invoice didn't relate to this contract, it related to an earlier contract, and certainly Covert was properly in possession of an invoice. [00:15:08] Speaker 07: And I cannot see how that could possibly violate the PIA. [00:15:18] Speaker 08: No, let me correct the record in that regard, Your Honor. [00:15:22] Speaker 08: There were unauthorized site visits that were violating the PIA. [00:15:27] Speaker ?: Covers Assistant Manager walked on site. [00:15:30] Speaker 08: This is Covers Assistant Manager, not the Chose. [00:15:32] Speaker 08: Walked on site, reached inside a desk, took out a staffing document, put it in his pocket and walked away. [00:15:38] Speaker 08: That's a PIA violation. [00:15:40] Speaker 08: And in addition to that, they took staffing. [00:15:42] Speaker 07: What document was that? [00:15:43] Speaker 07: What document was that? [00:15:46] Speaker 07: What document? [00:15:47] Speaker 07: What document? [00:15:49] Speaker 07: Are you contending covert improperly had? [00:15:54] Speaker 08: Well, the documents that covert, the document that covert took from the work site was improperly taken. [00:16:02] Speaker 03: And in addition to that, there was... Yes, but we want to know what document it was. [00:16:06] Speaker 03: I mean, if they walked in and took a napkin, it doesn't matter. [00:16:09] Speaker 03: What was the nature of the document? [00:16:12] Speaker 08: It listed all the staff and their contact information. [00:16:17] Speaker 08: And by doing so, gave them important information that they used in preparing their proposal. [00:16:24] Speaker 08: They used the pricing information. [00:16:25] Speaker 08: They used the staffing information. [00:16:27] Speaker 07: As the lower court noted... The pricing information is in your own invoice. [00:16:34] Speaker 08: The pricing information is in the... I don't... An invoice is one of a half a dozen different documents... Okay, but you have to agree that they properly have possession of an invoice that you sent them, right? [00:16:49] Speaker 07: Okay, so what document did they improperly have possession of that had a bearing on this contract? [00:16:57] Speaker 08: The information on staffing and the information on pricing, the invoice was only one of several. [00:17:03] Speaker 07: The information on pricing was attached to the invoice. [00:17:07] Speaker 08: No, Your Honor, there were multiple documents involved here, not only one invoice. [00:17:13] Speaker 08: That's not, I mean, the documents are actually in the record. [00:17:17] Speaker 07: You can see... I've looked at the documents in the record and I don't understand which pricing documents you're talking about that wasn't part of the invoice. [00:17:28] Speaker 08: Okay. [00:17:29] Speaker 08: Your Honor, as best as I can remember at this point, we're talking about the documents that listed the staffers and how much each one was being billed at and gave a breakdown [00:17:41] Speaker 08: how to put together a proposal that would cover the entire requirements. [00:17:46] Speaker 08: That's much more than invoice. [00:17:47] Speaker 07: Invoice is simply... Where is that document in the record that you're talking about that wasn't attached to the invoice? [00:17:57] Speaker 08: Let me see if I can find that, Your Honor. [00:18:04] Speaker 08: I don't have that reference in my notes, Your Honor. [00:18:07] Speaker 08: I'm sorry. [00:18:07] Speaker 08: I'd be happy to provide it for you. [00:18:10] Speaker 02: Council, can I ask you a question while you're looking for that? [00:18:13] Speaker 02: Why isn't KOVR entitled to that document as the primary contract holder on the earlier contract? [00:18:23] Speaker 08: Because KOVR is entitled, other than the stolen staffing document and the on-site visits, KOVR was entitled to the documents itself. [00:18:35] Speaker 08: KOVR was not entitled to share them. [00:18:37] Speaker 08: with de facto offeror here in Southern Food. [00:18:41] Speaker 08: If Ken Barnes had kept those documents, we would have never alleged a PIA violation at all. [00:18:47] Speaker ?: But the PIA specifically expressly concerns the distribution of documents to punitive subcontractors, potential subcontractors in the statute itself. [00:18:59] Speaker 08: So the PIA was violated not when Covert got the documents, but when Covert gave them to Southern Food [00:19:06] Speaker 08: According to FAR 3.107 and the statute itself. [00:19:14] Speaker 03: Okay, Council, we are way beyond your time. [00:19:17] Speaker 03: Let's hear from opposing Council. [00:19:19] Speaker 08: Thank you very much. [00:20:05] Speaker 03: Sure, that's fine. [00:20:11] Speaker 03: Whichever one of you is Mr. Schumacher, I have him as going first. [00:20:16] Speaker 04: I think it's Mr. Schroeder from the United States. [00:20:20] Speaker 03: On my list I have Mr. Schumacher for one minute and then Mr. Schroeder for 14. [00:20:25] Speaker 03: Is that not correct? [00:20:26] Speaker 04: I think our intention was for the government to go for 14 and the Intervenor 1 to follow us though. [00:20:34] Speaker 04: Okay. [00:20:35] Speaker 03: Well, if you use up all the time, he doesn't get any, just so you know. [00:20:38] Speaker 04: Okay. [00:20:38] Speaker 04: Thank you. [00:20:39] Speaker 04: May I just get a little water there? [00:20:41] Speaker 04: Sure. [00:20:41] Speaker 04: Thank you. [00:21:10] Speaker 04: May it please the court. [00:21:12] Speaker 04: I don't see the, oh, there we go, sorry. [00:21:15] Speaker 04: May it please the court. [00:21:17] Speaker 04: I'm turning to the issue of mootness. [00:21:20] Speaker 07: How can this case possibly be moot as far as the bid preparation costs are concerned? [00:21:27] Speaker 07: Because I'm talking about equitable relief. [00:21:30] Speaker 07: I mean, the recovery of bid preparation costs is something you're entitled to under the statute. [00:21:37] Speaker 07: Why doesn't the claim for bid preparation costs remain active, even if the request for equitable relief is moot? [00:21:46] Speaker 04: Because in this case, the contract itself has been terminated for reasons other than the bid protest. [00:21:55] Speaker 04: And this is a long-term contract that was awarded, five-year contract with six-month action, and a bid protest that has otherwise moot on its merits. [00:22:11] Speaker 04: does not continue to present a case in controversy merely because the court can award bid preparation. [00:22:16] Speaker 07: I think you're quite mistaken about that. [00:22:18] Speaker 07: If you look at the history of this statute originally, all you could get was bid preparation costs. [00:22:24] Speaker 07: And there are plenty of cases from us saying that the claim for bid preparation costs creates a case of controversy. [00:22:35] Speaker 07: Are you familiar with the history of the statute? [00:22:39] Speaker 04: To a degree, I'm looking at the cases that have held otherwise, and also... What cases held otherwise? [00:22:47] Speaker 04: Glenn Defense, which is an unpublished decision, but nonetheless, 2012... Veterans Contracting? [00:22:56] Speaker 07: Or what? [00:22:57] Speaker 07: Another case? [00:22:58] Speaker 07: Pardon me? [00:22:59] Speaker 07: What cases from our court? [00:23:01] Speaker 04: Well, Glenn, defense is a federal circuit from the Court of Appeals federal circuit case. [00:23:08] Speaker 04: And here also, before they can get bid prep costs, they have to win on the merits. [00:23:21] Speaker 07: And here, there's a judgment. [00:23:24] Speaker 04: Well, Your Honor, there's a judgment. [00:23:28] Speaker 04: And the way this became moot, if I may, there was a judgment issued on every single claim they raised in the lower court. [00:23:36] Speaker 04: And then they never sought a preliminary injunction. [00:23:42] Speaker 04: They didn't oppose the award going forward to Kovar. [00:23:47] Speaker 04: And then for reasons entirely unrelated to corrective action or anything like that, which is the typical bid protest, is where the contract is terminated for convenience. [00:23:57] Speaker 04: This contract went on and then Michko was a subcontractor on it. [00:24:03] Speaker 04: And then Michko itself, who is- I'm sorry. [00:24:07] Speaker 07: I don't understand what you're saying. [00:24:08] Speaker 07: There's a claim for bid preparation costs, right? [00:24:11] Speaker 04: There's a claim for bid preparation costs. [00:24:12] Speaker 07: Because the government messed up in making the award, right? [00:24:18] Speaker 07: So what difference does it make that the contract is ultimately terminated in terms of the ability to recover bid preparation costs? [00:24:27] Speaker 04: Because the government has not been proven to have [00:24:33] Speaker 04: made any error. [00:24:35] Speaker 07: That's the point. [00:24:37] Speaker 07: We have to determine whether there was an error or not. [00:24:39] Speaker 04: The Court of Federal Claims did, and they determined there was no error. [00:24:43] Speaker 07: On appeal, in addressing bet preparation costs, we have to decide whether there was an error or not. [00:24:50] Speaker 04: Well, I would respectfully disagree because [00:24:56] Speaker 04: There has to be a bid preparation cost is a remedy. [00:25:02] Speaker 04: It's not a separate claim. [00:25:05] Speaker 07: If you look at the history of the statute, it is exactly a separate claim. [00:25:10] Speaker 07: It used to be you couldn't get equitable relief. [00:25:13] Speaker 07: You could only get bid preparation costs. [00:25:15] Speaker 07: That was the entirety of the relief you were entitled to. [00:25:18] Speaker 07: That was the only claim you could assert. [00:25:21] Speaker 07: It doesn't become moot. [00:25:24] Speaker 07: because there's no ability to remedy the contractual violation by equitable relief. [00:25:32] Speaker 04: I don't want to just go around and around on this, because I understand your position, Your Honor. [00:25:39] Speaker 04: Of course, the Court is the decision maker. [00:25:42] Speaker 07: We believe that the... OK, well, let's talk about the equitable relief. [00:25:46] Speaker 07: This contract was canceled, but the solicitation wasn't canceled, right? [00:25:52] Speaker 04: Well, Your Honor, there's no FAR provision that we're aware of that requires the formal cancellation of a solicitation under these circumstances. [00:26:03] Speaker 04: Again, the contract was awarded. [00:26:07] Speaker 04: No one ever sought to enjoin the award of the contract. [00:26:11] Speaker 04: The solicitation [00:26:13] Speaker 04: is no longer an act of solicitation. [00:26:15] Speaker 04: Mr. Grayson, I believe, acknowledged that. [00:26:18] Speaker 04: So I don't think there's any disagreement. [00:26:20] Speaker 03: Well, that's what I was trying to understand is the factual scenario about whether or not his request for bid preparation costs might be premature. [00:26:32] Speaker 03: The government's got to provide food to this army base. [00:26:36] Speaker 03: So how is it providing food currently? [00:26:39] Speaker 04: through a bridge contract, which to our knowledge has not been protested by MITCHCO. [00:26:49] Speaker 03: Was it the subject of a solicitation? [00:26:52] Speaker 04: I think it was a sole source bridge contract that was issued. [00:26:59] Speaker 04: back in July is my recollection. [00:27:03] Speaker 03: If it's a sole source, they can't bid protest because they didn't get to bid. [00:27:09] Speaker 03: Can they? [00:27:10] Speaker 04: I don't know if they can, however. [00:27:14] Speaker 04: I believe it was publicly disclosed that this was happening. [00:27:18] Speaker 03: But you had just made a point about they didn't challenge the bridge contract. [00:27:22] Speaker 03: And I'm wondering if they even can challenge the bridge contract. [00:27:26] Speaker 04: I had assumed when I said that they could. [00:27:28] Speaker 04: But I've heard of challenges to bridge contracts. [00:27:33] Speaker 04: But I don't know. [00:27:34] Speaker 04: It's not an issue that we were focused on here. [00:27:37] Speaker 04: So I couldn't actually assume. [00:27:38] Speaker 03: Does the government not intend [00:27:40] Speaker 03: have another solicitation or to evaluate the bids of the current uncancelled solicitation? [00:27:47] Speaker 04: Mr. Grayson is correct. [00:27:51] Speaker 04: The government is not moving forward on the cancelled solicit. [00:27:56] Speaker 04: What has been referred to as uncancelled, however, it's constructively been cancelled. [00:28:01] Speaker 04: The government has moved on from that solicitation. [00:28:04] Speaker 04: It doesn't intend to proceed on that solicitation. [00:28:09] Speaker 04: The solicitation is now almost exactly, it was issued almost exactly two years ago. [00:28:15] Speaker 04: It was awarded before COVID. [00:28:20] Speaker 04: It's stale and... Why did you cancel the solicitation? [00:28:26] Speaker 06: I don't understand. [00:28:28] Speaker 04: Because the contract had already been awarded and performed and terminated. [00:28:33] Speaker 04: So solicitations under these circumstances, they don't simply kick back in on their own. [00:28:39] Speaker 04: And the contract, they don't. [00:28:40] Speaker 07: They don't kick back in on their own. [00:28:42] Speaker 07: If we say that you burdened awarding the contract to COBORN and you need to go back to the drawing board, doesn't that start the proceeding under this solicitation then? [00:28:54] Speaker 04: Well, it is up to the agency to determine whether to the type of action. [00:29:05] Speaker 04: And the agency has not made any steps to re-institute the solicitation. [00:29:12] Speaker 04: I believe the offers are long expired. [00:29:18] Speaker 04: There was never, and again, there was never any preliminary injunction sought. [00:29:23] Speaker 03: Can I make sure I understand the fact that you said the contract was awarded and already performed? [00:29:28] Speaker 03: I thought that the breach occurred while Michko was still the supplier. [00:29:34] Speaker 03: Am I wrong? [00:29:35] Speaker 03: Do I have those facts wrong? [00:29:36] Speaker 03: Had the transition occurred and had Southern started supplying food under the new contract prior to the breach? [00:29:48] Speaker 04: Yes, let me explain that. [00:29:49] Speaker 04: Michko has long been and was on the prior contract, a subcontractor, performing most of the actual work. [00:29:59] Speaker 03: Right. [00:29:59] Speaker 03: I understood that. [00:30:00] Speaker 04: And Covarr was the... So when Covarr's contract got terminated, Michko [00:30:11] Speaker 04: subcontract got terminated in effect. [00:30:14] Speaker 04: However, Michgo, the reason that Covars contract was terminated was because Michgo indicated they would no longer provide those subcontracts. [00:30:26] Speaker 03: Because they weren't getting paid. [00:30:27] Speaker 03: But in any event, let's back up. [00:30:30] Speaker 03: What you said is the contract was awarded and performance had begun. [00:30:35] Speaker 03: I didn't think, as a factual matter, performance had begun already. [00:30:40] Speaker 04: under the new awarded contract to cover am I mistaken about my understanding of the facts yes your honor okay that's what I needed to know I apologize it's not clear the contract was awarded work was begun it won on for I believe [00:30:57] Speaker 04: many months before this issue arose. [00:31:00] Speaker 04: Mitch Goh, who was at that time even on the new contract, acting as the subcontractor. [00:31:06] Speaker 03: That's the part I didn't understand. [00:31:08] Speaker 03: I thought that the new subcontractor was going to be Southern. [00:31:11] Speaker 03: So that's the part I didn't understand. [00:31:12] Speaker 04: Yes. [00:31:13] Speaker 04: And again, I can fill that in, Your Honor. [00:31:15] Speaker 04: The new subcontractor was supposed to be Southern. [00:31:21] Speaker 04: But Mitch Goh got injunctive relief in Kentucky State Court [00:31:28] Speaker 04: prohibiting the COVAR, which is an agency of the state of Kentucky, from replacing Michigan with Southern as a matter of state law. [00:31:41] Speaker 04: Because apparently, they didn't go through the Kentucky procurement. [00:31:46] Speaker 03: Who knew there were so many places where these things could be challenged? [00:31:49] Speaker 03: It is quite a surprise to me. [00:31:51] Speaker 03: Can I ask you a really dumb question? [00:31:53] Speaker 03: Why are you awarding all these contracts to KOVR when they're not actually the one performing? [00:31:58] Speaker 03: Why aren't you going straight and awarding them to the subs? [00:32:00] Speaker 03: Why not award it to Michko? [00:32:02] Speaker 03: Why not award it to Southern? [00:32:03] Speaker 03: It seems like KOVR has just taken a slice of the pie and thereby increasing the cost to the government of the contracts. [00:32:10] Speaker 03: What am I missing that I don't understand about these contracts? [00:32:13] Speaker 04: Yes, and these contracts are a Randolph-Shepard Act contract, and the purpose of the contract is to [00:32:23] Speaker 04: allow blind individuals to engage in government contracting. [00:32:30] Speaker 03: So COVAR is a state of Kentucky agency that... Is this the thing I remember reading somewhere that they employ one blind person and there was some ruling that there has to be one blind person per cafeteria or something? [00:32:45] Speaker 03: I'm sorry, I don't recall the specifics, but I do remember reading something about that. [00:32:49] Speaker 03: Is that part of what was involved in the state court action? [00:32:54] Speaker 04: I'm not sure if it was involved in state corrections. [00:32:57] Speaker 04: That was one of Michko's arguments here, that they were required to have one blind individual at each location. [00:33:05] Speaker 07: That's the joint statement of policy, right? [00:33:07] Speaker 04: Yes. [00:33:07] Speaker 04: And the trial court rejected that. [00:33:13] Speaker 04: But the purpose of the whole contract, the overridden purpose, is to help blind individuals [00:33:19] Speaker 04: be government contractors. [00:33:23] Speaker 03: So the solicitation was issued as sort of a hybrid between... When you say to help blind individuals be government contractors, this individual is just a worker at KOVR, right? [00:33:35] Speaker 03: This isn't like, you know, how small business or women-owned contracting or minority-owned contracting. [00:33:42] Speaker 03: This is just a... KOVR is a large organization that is... [00:33:47] Speaker 03: I don't understand. [00:33:48] Speaker 03: Is it owned? [00:33:50] Speaker 03: I'm just trying to understand this. [00:33:52] Speaker 04: Yeah, KOVR is an agency or an office, a government office or agency of the state of Kentucky. [00:33:59] Speaker 03: I see. [00:34:00] Speaker 04: And the one person is the? [00:34:02] Speaker 04: Is the vendor. [00:34:03] Speaker 04: They're not an employee of KOVR. [00:34:06] Speaker 04: They're actually a vendor and then [00:34:09] Speaker 04: So there are multiple levels of subcontracting. [00:34:12] Speaker 04: I think that Michco was and Southern would have been at least a second level. [00:34:22] Speaker 03: I understand now. [00:34:23] Speaker 03: So to be clear, KOVR isn't actually providing any of the food services, or are they partnering with their sub when they used to be doing it? [00:34:32] Speaker 03: Were they just a layer on top of oversight and then they sub it out, or were they partnering and participating in the delivery of the food? [00:34:41] Speaker 04: KOVR is a state office that supervises this, but they're not actually providing the services. [00:34:49] Speaker 04: It's a program to help the blind. [00:34:54] Speaker 07: I'm really troubled with the idea that you can moot a bid protest body. [00:35:01] Speaker 07: awarding, properly awarding the contract to one party who shouldn't have had it, and then terminating that contract. [00:35:09] Speaker 07: And, you know, that creates all sorts of possibilities for manipulation, such as, you know, you think you're going to lose the bid protest, so you boot the whole thing by canceling the contract. [00:35:21] Speaker 07: I'm not sure that that's proper, appropriate, or legal. [00:35:26] Speaker 04: Your Honor, actually that was in the CCL case. [00:35:30] Speaker 04: The court expressed concern about that. [00:35:34] Speaker 04: And so that can always be a concern, but in this case, [00:35:40] Speaker 04: This had nothing to do with the litigation or the probe. [00:35:43] Speaker 07: Well, we don't have to determine that it was an improper motive. [00:35:45] Speaker 07: I'm just saying, how can it be that the government can moot these challenges by canceling the contract? [00:35:51] Speaker 04: Because the government, in this case, the government effectively didn't moot it because what happened was when Mitch, though, who's the subcontractor, walked off the job. [00:36:02] Speaker 07: I don't think you're addressing my question. [00:36:05] Speaker 07: Because it wouldn't be any different whether [00:36:09] Speaker 07: for mootness purposes, whether the contractor walked off the job or you decided to terminate it for cause or for convenience or whatever. [00:36:19] Speaker 07: I mean, under your mootness theory, the whole controversy goes away once the contract is canceled. [00:36:24] Speaker 07: I'm not sure what the authority is for that. [00:36:26] Speaker 04: Your Honor, and I'll do so rapidly since I see my time is up. [00:36:31] Speaker 03: No, it's important. [00:36:31] Speaker 03: Don't worry about the time. [00:36:32] Speaker 03: We want to try and figure this out. [00:36:34] Speaker 03: It's a very hard case. [00:36:35] Speaker 04: OK, so in this case, Kovar and the government has to provide these food services to a very large number of service personnel. [00:36:49] Speaker 04: And in this case, Kovar said, we cannot provide adequate assurances that after, I believe it was June 4th. [00:36:57] Speaker 07: I don't know what the facts of the case are, but I don't think you're addressing my question. [00:37:00] Speaker 07: My question is, how can it be that the government can eliminate a bid protest and say, we don't have to worry about that, just by canceling the contract, for whatever reason? [00:37:11] Speaker 07: How can that be? [00:37:12] Speaker 04: Because if there's no bad faith, and it's done properly, and it's as long as there's [00:37:19] Speaker 04: But it wasn't done to moot the protesters, it was done because they needed to be able to feed the military personnel. [00:37:27] Speaker 04: Those are cases that essentially [00:37:37] Speaker 04: For example, Kingdomware said normally when the contract is completed, it would moot the bid protest, except for the fact that in that case, the contract's term was for less than two years, where in this case, the term was for five years. [00:38:06] Speaker 06: Excuse me. [00:38:07] Speaker 06: 2025, something like that, right? [00:38:10] Speaker 04: Something around there, yes. [00:38:11] Speaker 04: But what happened was an intervening event, which is what causes mootness, occurred that was unrelated to the solicitation. [00:38:19] Speaker 03: But here's the problem. [00:38:20] Speaker 03: The problem is, and maybe your answer should be, [00:38:24] Speaker 03: then the answer to the concern Judge Dyk has and that I share is that Mitch Goh should challenge the sole source award to Southern. [00:38:31] Speaker 03: Maybe that should be your answer. [00:38:33] Speaker 03: But his problem, which I share, is it's really troubling to say this whole big protest is moot because KOVR is now out of the picture and the contract has been breached and so it's no longer in force. [00:38:49] Speaker 03: Now there were only two other [00:38:51] Speaker 03: contracts or bidders who submitted bids that met the minimum requirement. [00:38:58] Speaker 03: It seems pretty clear the second place bidder was Michko, the third place bidder was Southern, and the contract and I hope I didn't just do something that was supposed to be confidential. [00:39:09] Speaker 03: If I did, I apologize. [00:39:11] Speaker 03: Somebody's got to tell me if I did. [00:39:12] Speaker 03: Did I do something wrong? [00:39:14] Speaker 03: Nobody's saying anything, so I'm going to assume it's not confidential. [00:39:18] Speaker 04: It's a council, it's in the audience. [00:39:21] Speaker 03: Somebody would jump up and down and say something, because I can always strike it from the recording if I've said something improper. [00:39:27] Speaker 03: Preached confidentiality, I mean. [00:39:31] Speaker 03: So there was a contract. [00:39:34] Speaker 03: KOVR came in first, Michco came in second, Southern came in third. [00:39:38] Speaker 03: You avoided the KOVR. [00:39:40] Speaker 03: KOVR then breached and were kicked out. [00:39:43] Speaker 03: So now you're left with Michko in second place, Southern in third. [00:39:47] Speaker 03: Instead of awarding it to Michko, what you did is somehow justify sole source, probably because of the urgency of needing food, and then chose the third place person. [00:39:56] Speaker 03: That feels [00:39:59] Speaker 03: wrong now if you want to do that it feels okay but it feels wrong to say that that process leaves michiko without any avenue for challenging the propriety of that process do you understand the problem yes well it wasn't awarded to a third place person michiko southern wasn't wasn't even an offeror in this [00:40:19] Speaker 03: Oh, I thought Southern was the third place offer. [00:40:21] Speaker 04: No, there's another offer or whose name I won't mention. [00:40:25] Speaker 03: Then I got it wrong. [00:40:28] Speaker 03: But that doesn't necessarily make it better, by the way, that the person you awarded it to didn't submit one of the original bids and wasn't one of the top three choices. [00:40:37] Speaker 03: I'm not sure that actually made it better for you. [00:40:39] Speaker 03: You should have left me delusional. [00:40:43] Speaker 04: But the other issue is that Michko [00:40:48] Speaker 04: remember, was the subcontractor performing the work. [00:40:51] Speaker 04: They walked off the job. [00:40:53] Speaker 04: And I know that's a sensitive issue as far as mootness. [00:40:57] Speaker 04: However, Michco, had they not walked off the job, the contract would probably still be going on. [00:41:04] Speaker 04: And I'm not pointing a finger at Michco. [00:41:07] Speaker 04: I'm not pointing a finger at Michco. [00:41:10] Speaker 04: Michco made a business decision. [00:41:16] Speaker 03: It feels like not a business if you're not getting paid. [00:41:21] Speaker 04: But one, Mitch goes showed no right to an award. [00:41:26] Speaker 04: All they did was come up with a competitive rank. [00:41:29] Speaker 03: Were they or were they not second in the rankings? [00:41:31] Speaker 03: I thought there were rankings, and it was undisputed they were second. [00:41:35] Speaker 03: Is that correct? [00:41:36] Speaker 04: I believe they were second. [00:41:37] Speaker 04: However, there was only a competitive range determination, so there's a whole lot more to be done. [00:41:42] Speaker 03: I thought the solicitation expressly said it was going to go to the top ranked offeror. [00:41:48] Speaker 03: and that KOVR was top ranked and Michiko was second. [00:41:51] Speaker 04: KOVR was going to do a competitive range determination and then based on the competitive range determination under the priority the state licensing agency, COVAR, if they were in the competitive range then the agency would negotiate with them first and if the negotiations were successful then [00:42:16] Speaker 04: The award would go to Kovar, which is what happened. [00:42:19] Speaker 07: OK, but if Kovar were out of the picture, and they claim that it should have been disqualified, if Kovar were out of the picture, this contract would have been awarded to Michko, right? [00:42:30] Speaker 04: I believe it's premature to say it, because they were only in the competitive range. [00:42:35] Speaker 04: So then there would have to be a determination [00:42:39] Speaker 04: whether to award it to MITCHCO. [00:42:41] Speaker 04: There may be negotiations. [00:42:43] Speaker 04: It didn't get passed beyond the competitive range determination and then negotiations with COVAR. [00:42:50] Speaker 04: And at this point, now two years have gone by, so the agency still needs to assess its needs. [00:42:58] Speaker 04: There's been a pandemic in between this contract being awarded [00:43:02] Speaker 04: February of 2020 and now so They have that has to be accounted for is whether running a very large There's no requirement to cancel it, but I think this is effectively Constructively cancelled solicitations as far as the agency Understands that the solicitation is no longer an active solicitation so [00:43:32] Speaker 03: Okay, so why don't you focus me for a second on what is the relief that MITCHCO could potentially be entitled to. [00:43:43] Speaker 03: They asked for five forms of relief in their original complaint. [00:43:49] Speaker 03: It seems to me that if the solicitation is effectively canceled, that the first form of relief, a declaration that KOVR should never have gotten the contract, is moot. [00:44:00] Speaker 03: The solicitations cancel, the contracts go on. [00:44:02] Speaker 03: The second one, if I'm remembering right, is that Mitch Coe should be deemed the second highest. [00:44:09] Speaker 03: But again, if you're telling me the solicitation is effectively, constructively canceled, what would be the point of such a declaration? [00:44:15] Speaker 03: That seems moot. [00:44:16] Speaker 03: These are what Judge Dyck referred to, I think, as the equitable forms of relief. [00:44:20] Speaker 03: And then when we get down to bid preparation costs, why isn't that still a live issue? [00:44:27] Speaker 03: They put a lot of money into preparing their bid, [00:44:30] Speaker 03: Under the circumstances they were the second highest bidder and you've decided to constructively cancel the solicitation. [00:44:37] Speaker 03: Well first you awarded it to someone else and now you've decided to constructively cancel it. [00:44:42] Speaker 03: Why aren't they eligible to argue in favor of bid preparation costs? [00:44:48] Speaker 04: Because the cases [00:44:51] Speaker 04: in our opinion, moot as of now. [00:44:53] Speaker 04: And they haven't, nobody, Micho's never secured a favorable ruling on any issue. [00:45:00] Speaker 04: So what Micho's saying essentially. [00:45:01] Speaker 03: So why isn't the answer, but those, the things you say they haven't secured a favorable ruling on are exactly the things that are unappealed to us that I said were moot, i.e., don't affect actually the award of the contract. [00:45:15] Speaker 03: But isn't this kind of like attorney's fees? [00:45:17] Speaker 03: Sometimes, [00:45:18] Speaker 03: Somebody wins, and then they want attorney's fees on appeal, and I have to look behind the win to see whether they should get the attorney's fees. [00:45:27] Speaker 03: I actually have to look at the thing that is otherwise moot and that I no longer need to decide in order to assess whether they should get attorney's fees. [00:45:35] Speaker 03: Isn't that kind of like this? [00:45:37] Speaker 03: Maybe those equitable issues were mooted, but maybe I have to actually go ahead and decide them anyway in order to get to [00:45:45] Speaker 03: whether they should get bid preparation costs because if I'm convinced they're right and they should have been the awardee not KOVR, then they would be entitled to bid preparation costs, wouldn't they? [00:45:56] Speaker 04: Well, the purpose of bid preparation costs is to [00:46:03] Speaker 04: remedial situation where somebody has wasted their efforts, but here... [00:46:16] Speaker 04: But it would require a decision on the merits. [00:46:21] Speaker 07: Well sure, that's the point. [00:46:22] Speaker 04: But we've already had a judgment against Michco and they did not object to the award of the contract. [00:46:30] Speaker 04: They did not seek a preliminary injunction. [00:46:33] Speaker 04: So they basically did not take steps to stop this. [00:46:36] Speaker 04: So they allowed this to [00:46:38] Speaker 04: I don't understand what you're talking about. [00:46:41] Speaker 03: They followed a bid protest. [00:46:43] Speaker 04: But they did not seek a preliminary injunction because they were the subcontractor and they did not object to the commencement of work. [00:46:49] Speaker 07: They didn't get bid preparation costs because they didn't seek a preliminary injunction. [00:46:52] Speaker 07: You got it exactly backwards. [00:46:54] Speaker 07: The whole point is that by only seeking bid preparation costs, if they never asked for an equitable belief, they'd have a perfect claim. [00:47:03] Speaker 07: You can claim nothing but bid preparation costs. [00:47:06] Speaker 07: I don't care about the contract anymore. [00:47:07] Speaker 07: I just want my bid preparation costs. [00:47:09] Speaker 07: That's a cause of action. [00:47:11] Speaker 07: That used to be the only cause of action under the statute. [00:47:18] Speaker 04: I understand your point, Your Honor. [00:47:21] Speaker 04: But again, in this case, there is a [00:47:24] Speaker 04: no longer, I'll review, a live case or controversy because even in the EGIE cases where the agency takes corrective action and cancels a solicitation, good preparation costs, EGIE is not available for the same type of logic. [00:47:47] Speaker 07: I don't know. [00:47:49] Speaker 07: The EGIE, like EGIE fees, can't prevent it from being moved. [00:47:52] Speaker 07: That's correct. [00:47:53] Speaker 07: But bid preparation costs are different. [00:47:56] Speaker 07: They're a form of contract damages. [00:47:59] Speaker 07: The statute refers to them as a form of contract damages. [00:48:03] Speaker 07: The history of the statute refers to them as a form of contract damages. [00:48:11] Speaker 04: Your Honor, I understand. [00:48:15] Speaker 04: You know, it still continues to be for a reason to set forth an hour. [00:48:18] Speaker 03: Okay, you're off the hook. [00:48:21] Speaker 03: And Mr. Schroeder, you get your hot seat, or Schumacher, you get your hot seat for one minute. [00:48:26] Speaker 03: One minute, and now no one's ever going to believe me. [00:48:29] Speaker 03: It's like when I tell my toddlers they can't have something and then I give it to them anyway. [00:48:34] Speaker 03: Come on. [00:48:35] Speaker 01: Well, Your Honor, I'll go ahead and I'll limit my time to your questions about the Randolph-Shepard Act and COVAR's involvement in state licensing agency. [00:48:45] Speaker 01: COVAR, or I'm sorry, the Randolph-Shepard Act is supposed to provide remunerative employment, and it gives a prior right to cafeteria contracts on federal property to the state licensing agencies in the blind package. [00:48:55] Speaker 03: What does that have to do with what we have to decide today? [00:48:58] Speaker 01: Well, it ties in, if the court has to... You get one minute, but it's only if it's going to be useful. [00:49:03] Speaker 01: I'm sorry I was trying to answer your questions you had about the Randolph Shepard Act and Kovar's relationship. [00:49:08] Speaker 01: The blind vendors here and the state licensing agency which Kovar is. [00:49:12] Speaker 07: Why is the Randolph Shepard Act, whatever it's called, Trump the small business? [00:49:17] Speaker 01: Well, first of all, because the solicitation says it does, the record 1,747, the solicitation specifically said, all offers are hereby notified that the RSA applies to the solicitation. [00:49:31] Speaker 01: Therefore, a priority will be given to the state licensing agency pursuant to the RSA. [00:49:37] Speaker 01: And B to that was a competitive arrangement will be established after initial evaluation of proposals. [00:49:42] Speaker 01: If the state licensing agency, the SLA, is determined to be in the competitive range, then the SLA will be afforded the priority as delineated in the RSA. [00:49:51] Speaker 01: If they're not determined to be in the range, then successful offer within the competitive range will be selected. [00:49:56] Speaker 01: Everybody was on notice that if the SLA put a bid within the competitive range, it would be awarded the contract, not a small business, not a small business set aside. [00:50:06] Speaker 01: The Randolph-Shepard Act, the statute itself, gives blind vendors and state licensing agencies a priority to operate cafeterias on federal property. [00:50:15] Speaker 03: And nobody objected, just to be clear, nobody objected to that solicitation language, correct? [00:50:21] Speaker 01: That is correct, Your Honor. [00:50:21] Speaker 03: Yeah, because that's the key. [00:50:22] Speaker 01: Yes, Your Honor. [00:50:23] Speaker 01: That is correct. [00:50:23] Speaker 03: It turns out you were helpful. [00:50:24] Speaker 03: Now your minute is long overdue. [00:50:26] Speaker 01: Thank you, Your Honor. [00:50:27] Speaker 01: I appreciate your time. [00:50:30] Speaker 03: All right. [00:50:31] Speaker 03: Now we get Mr. Grayson back. [00:50:33] Speaker 03: Hopefully we haven't lost him. [00:50:35] Speaker 03: Good. [00:50:37] Speaker 03: You want to try leaving them and see if it doesn't mess up. [00:50:54] Speaker 02: Thank you. [00:50:55] Speaker 03: All right, Grayson, to keep the time fair, you've got 75 minutes. [00:51:06] Speaker 03: Go. [00:51:08] Speaker 00: It was a joke. [00:51:12] Speaker 08: Joke. [00:51:13] Speaker 08: Your Honor, I'm very grateful for the four minutes that I see posted. [00:51:16] Speaker 08: Thank you very much. [00:51:17] Speaker 08: This is possibly most concerning. [00:51:19] Speaker 03: You can go over a few minutes, too. [00:51:22] Speaker 02: Mr. Grayson, could you address some of these mootness questions on an issue-by-issue basis as you deal with your four minutes? [00:51:30] Speaker 08: I want to begin by correcting the record in several important respects, Your Honor. [00:51:34] Speaker 08: May I do that? [00:51:36] Speaker 03: Sure. [00:51:37] Speaker 03: And if you go over, it's okay. [00:51:38] Speaker 03: Then you'll make certain you answer Judge Cunningham's question. [00:51:42] Speaker 08: Okay. [00:51:43] Speaker 08: Let me start with Judge Cunningham's question. [00:51:45] Speaker 08: Can I hear it again, please? [00:51:46] Speaker 02: Oh, sure. [00:51:47] Speaker 02: Could you address these mootness questions? [00:51:50] Speaker 02: I think you heard the other counsel being asked a series of questions on an issue-by-issue basis with respect to mootness. [00:51:56] Speaker 02: I want you to address those and respond accordingly. [00:52:01] Speaker 08: Okay. [00:52:01] Speaker 08: First, I seem to concur with the panel [00:52:06] Speaker 08: issue a bid proposal in preparation for this cannot be, it just can't be. [00:52:11] Speaker 08: Second, with regard to injunctive relief, the injunctive relief we're specifically looking for is to order the agency to adhere to what is said in the solicitation [00:52:24] Speaker 08: which is an award will be made to a single law forum. [00:52:27] Speaker 08: It's timely. [00:52:27] Speaker 02: Yeah, but we can't do that. [00:52:29] Speaker 02: Oh, I'm sorry. [00:52:29] Speaker 02: Oh, no, I was agreeing with you. [00:52:31] Speaker 02: Go ahead. [00:52:31] Speaker 02: I was going to say, but as the chief judge indicated previously, that would be moot. [00:52:36] Speaker 02: I just wanted to make sure I get your response on each issue. [00:52:42] Speaker 08: Well, I'm sorry, but I don't understand why it would be moot to order the agency to follow the terms at this stage. [00:52:50] Speaker 03: Because the solicitation is canceled. [00:52:52] Speaker 03: According to the government, the solicitation is constructively canceled, and they are no longer actively considering any awards under that solicitation. [00:53:00] Speaker 03: So why? [00:53:02] Speaker 03: We certainly, you have to agree, we certainly can't order the government to award the contract to someone, right? [00:53:07] Speaker 03: They can decide to withdraw a solicitation. [00:53:10] Speaker 08: You can do what you always do, which is to order them to adhere to the law and to their own solicitation terms. [00:53:16] Speaker 08: That's the most common relief of all in a bid-bred test. [00:53:19] Speaker 08: But, Your Honor, today is the first day in all the briefings that take place in this case and below when I've heard the government say that the solicitation was constructively canceled. [00:53:30] Speaker 08: Constructively is one of those words like virtually. [00:53:32] Speaker 08: It means not. [00:53:33] Speaker 08: Okay? [00:53:34] Speaker 08: Whenever you can't say that something was canceled, you say it was constructively canceled. [00:53:38] Speaker 08: Whenever you can't say it was canceled, you say it was virtually canceled. [00:53:42] Speaker 08: It means it wasn't canceled. [00:53:43] Speaker 03: I don't know, Counsel. [00:53:44] Speaker 03: You're appearing virtually. [00:53:45] Speaker 03: What does that say? [00:53:51] Speaker 08: I can't. [00:53:52] Speaker 08: I can't. [00:53:52] Speaker 08: And the response to that, Your Honor. [00:53:54] Speaker 03: Fair enough. [00:53:55] Speaker 08: Go ahead. [00:53:55] Speaker 08: Seed the point. [00:53:57] Speaker 08: Thank you very much for pointing that out. [00:53:59] Speaker 08: Here I am. [00:54:01] Speaker 08: But as I was saying, today's the first day they've taken that position. [00:54:05] Speaker 08: And it's a dangerous one. [00:54:06] Speaker 08: It's a dangerous one, Your Honor. [00:54:08] Speaker 08: Any time the government can say any big protest before its appeal, that solicitation is constructively canceled. [00:54:16] Speaker ?: And then the case goes away. [00:54:18] Speaker ?: How could that possibly be the law? [00:54:20] Speaker 03: that would be catastrophic for government contracts if the government could move it's own misconduct by saying we can't structurally cancel... Could you have appealed or filed a protest in some way what appears to be the sole source bridge contract that's been awarded to Southern? [00:54:39] Speaker 03: Was there any avenue for you to contest that award? [00:54:47] Speaker 08: The answer to the question, Your Honor, is honestly that was discussed, and it was felt that would be irresponsible to do that, because that might force the court to decide whether to cut off feeding the troops, which nobody wants. [00:55:03] Speaker 08: Michco provided the service to the government for 27 years, and the idea of seeking an injunction against the bridge contract [00:55:16] Speaker 07: Is there a time period for a protesting contract in the FAR and the statute? [00:55:27] Speaker 08: Before the Court of Federal Acclaims only latches, Your Honor, which is not a fixed time period, and the six-year limitations period, the Supreme Court actually decided that in the last couple of years that there'd be no bar other than the limitations period and latches. [00:55:46] Speaker 03: If we did not agree with you that we could give you the equitable relief that you seek under these circumstances, but we believed that your bid preparation fees were not moot, that would require us to nonetheless look behind all of the Court of Federal Claims [00:56:08] Speaker 03: determinations against you and determine whether they were correct. [00:56:12] Speaker 03: Is that your understanding of what this court would need to do in order to award you your bid preparation costs? [00:56:19] Speaker 08: Absolutely, Your Honor. [00:56:20] Speaker 08: We have to establish how entitlement on the merits in order to justify it. [00:56:24] Speaker 03: So the problem you have is even though I am sympathetic to the fact that this entire procurement process to include the sole source award is disquieting to me, let's say, but I'm not positive that you've convinced me that the Court of Federal Claims aired [00:56:48] Speaker 03: on its determination that the government did not err when awarding the contract to KOVR in the first place. [00:56:55] Speaker 03: So that's where you'd have to get me to agree it was an error to award the KOVR in the first place in order for you to get your bid protest costs. [00:57:04] Speaker 08: Or bid preparation costs. [00:57:05] Speaker 08: Well, Your Honor, I think that's correct. [00:57:08] Speaker 08: And you have 80 pages of briefing on that specific subject at this point. [00:57:12] Speaker 08: I hesitate to think of how long it might take if I were to try [00:57:17] Speaker 08: ask for indulgence regarding the four issues on the merits that we raised. [00:57:21] Speaker 08: Frankly, I don't think that some of them are close questions. [00:57:24] Speaker 08: I think some of them are clearly mistakes on the part of the lower court. [00:57:28] Speaker 08: But I go into whatever detail the court wants. [00:57:33] Speaker 07: Which ones do you think are clear? [00:57:36] Speaker 03: What's your strongest one? [00:57:39] Speaker 08: I think that the strongest one is the PIA violations, as Judge Beck already explained, the statute clearly distinguishes [00:57:54] Speaker ?: government officials can violate the PIA, it's clearly wrong. [00:57:56] Speaker 08: And by the way, a very dangerous precedent to say that the PIA, which is the main bulwark against procurement integrity violations, is limited to being used only against government officials. [00:58:10] Speaker 08: That's clearly not what the statute says. [00:58:12] Speaker 08: It's what 2101A says, but it's not what 2101B says. [00:58:17] Speaker 08: And the lower course decision, which is on the books right now, [00:58:21] Speaker 08: If the government, Council, one last question for you. [00:58:28] Speaker 03: If the government had simply canceled this solicitation, would you be entitled to argue in favor of bid preparation costs under those circumstances if the government had chosen to simply cancel the solicitation? [00:58:44] Speaker 08: If the government had done that immediately, we would have filed a separate protest against that. [00:58:50] Speaker 08: And I think the answer is yes, Your Honor. [00:58:52] Speaker 03: So I guess here's my question. [00:58:55] Speaker 03: When we walk out of here, are you going to go file a protest against the constructive cancellation since today is in fact the first day you learned it's canceled? [00:59:03] Speaker 03: And I'll go on the record and say there's nothing in anything I read in this case that made it clear to me the government believed it was constructively canceled. [00:59:10] Speaker 03: So I'll help you in that regard from a timing standpoint. [00:59:14] Speaker 03: Based on this entire record, I can't imagine how you could have known for certain that it was canceled before the government's representations today to that effect. [00:59:21] Speaker 03: So now do you want to go and file a bid protest on the fact that they've cancelled it? [00:59:26] Speaker 08: I think it's quite possible this court will rule that there is no such thing as a constructive cancellation, especially under these circumstances when the government is trying to get out from underneath the bid protest by that kind of means. [00:59:41] Speaker ?: So I'm going to wait and see what the court rules, but I'll be ready the day after that. [00:59:52] Speaker 08: error in this argument. [00:59:55] Speaker 08: Michko was actually literally next in line and waiting for a ward under the scheme of the solicitation. [01:00:02] Speaker 08: Also, for Judge Dyke, I have the references to the record that Judge Dyke asked for. [01:00:07] Speaker 08: I got those while I was listening to my colleague's argument. [01:00:12] Speaker 08: Judge Dyke, if you look at tab 26 and 29, especially on page 2329, [01:00:21] Speaker 08: and 23, sorry, 2419, you'll see that it wasn't simply a bill that was submitted. [01:00:30] Speaker 08: It was handed over to Southern. [01:00:32] Speaker 08: It was billing and head counts, a pricing schedule. [01:00:38] Speaker 07: Which was attached to the invoice, right? [01:00:42] Speaker 08: No, no. [01:00:43] Speaker 08: No, that's not true, Your Honor. [01:00:46] Speaker 08: I mean, I'm citing it. [01:00:48] Speaker 07: Where does the record tell me that it wasn't attached? [01:00:51] Speaker 07: Because it appears, where does the record tell me those things weren't attached to the invoice? [01:01:00] Speaker 08: I don't think that there's anything in the record other than my letters to indicate what was attached and what wasn't attached. [01:01:08] Speaker 08: My letters don't say that they were attached, nor in fact were they attached, Your Honor. [01:01:13] Speaker 08: I mean, I'm the one who wrote the letter. [01:01:15] Speaker 08: And I remember that that wasn't the case. [01:01:18] Speaker 08: So you can look at my letter, you can see from my letter that that is not the case. [01:01:23] Speaker 08: But in addition to that, there was staffing and payroll information, there was a PowerPoint slide on summer hiring, and there was Mischo's union contract. [01:01:33] Speaker 08: So all those things were things other than the invoice. [01:01:36] Speaker 08: And by the way, there'd be no reason to attach any of those things to an invoice. [01:01:40] Speaker 08: There's no reason for us to attach a PowerPoint presentation about hiring for the summer program. [01:01:47] Speaker 03: Okay, mr. Grayson, I thank all the council this argument has been helpful to the court and this case is now deemed submitted