[00:00:00] Speaker 02:
Our next argument is in docket number 24-1424, Centurion Technologies, Corp versus United States.

[00:00:09] Speaker 01:
Good morning still, Your Honors, and may it please the Court.

[00:00:13] Speaker 01:
Alex Ginsburg for Appellant, Cannes Soft Tech, Inc.

[00:00:18] Speaker 01:
The issues in this appeal are critical to the federal procurement community.

[00:00:23] Speaker 01:
This appeal asks whether a federal agency is permitted to remand a matter to itself

[00:00:29] Speaker 01:
Without leave of the court.

[00:00:30] Speaker 03:
I don't understand why you're talking about a remand.

[00:00:32] Speaker 03:
There wasn't a remand here.

[00:00:34] Speaker 03:
They canceled the procurement, or they canceled the awards, right?

[00:00:38] Speaker 01:
Your Honor, eventually after what we're calling the self-remand, there was a cancellation of the awards.

[00:00:47] Speaker 03:
There's no remand.

[00:00:48] Speaker 03:
They didn't say they were self-remanding.

[00:00:50] Speaker 03:
They canceled the awards.

[00:00:55] Speaker 03:
Is there anything that prevents them from canceling the award?

[00:00:58] Speaker 01:
The answer is yes, Your Honor.

[00:01:00] Speaker 01:
An agency can't take corrective action unilaterally and implement it, or take a remand in the midst of litigation on its own.

[00:01:09] Speaker 03:
Stop talking about a remand, because there wasn't a remand here.

[00:01:12] Speaker 03:
If an agency awards a contract,

[00:01:16] Speaker 03:
And it gets protested.

[00:01:17] Speaker 03:
And the agency looks at it and says, oh, we did something wrong.

[00:01:22] Speaker 03:
Are you saying it is not permitted to just go ahead and cancel the entire contract and say, we're not going to, we cancel the award.

[00:01:29] Speaker 03:
This is done.

[00:01:30] Speaker 03:
And then go to the court of federal claims and say, this is me dismissing.

[00:01:34] Speaker 01:
I'm saying if the agency takes a corrective action.

[00:01:37] Speaker 03:
The answer to what I just said, is that permissible if an agency looks at a contract award after it's been protested and says, we canceled this, out, nothing else, we canceled this, and goes to the court of federal claim and says, dismiss it, it's moving.

[00:01:56] Speaker 03:
They can do that, right?

[00:01:57] Speaker 03:
They don't have to get the court's permission to cancel a contract award.

[00:02:00] Speaker 01:
In the midst of a protest, an agency... I'm sorry, Ron, I'm trying to answer your question.

[00:02:04] Speaker 03:
Well, answer it, but I don't know what your basis for that is.

[00:02:07] Speaker 03:
This is just like any other case involving an agency, a private party, or anything else.

[00:02:13] Speaker 03:
If somebody gets sued for doing something and they voluntarily stop doing that, it moots the case, doesn't it?

[00:02:19] Speaker 01:
Your Honor, I disagree with that characterization.

[00:02:22] Speaker 03:
Do you have any support whatsoever for that?

[00:02:24] Speaker 03:
Because that's what a settlement is, or that's what mooting a case is.

[00:02:28] Speaker 03:
It happens all the time if somebody takes voluntary action to moot a cause of action.

[00:02:35] Speaker 01:
Your Honor, it's not just me who's saying this.

[00:02:38] Speaker 01:
The Chief Judge Salsom of the Court of Federal Claims has recognized that the agency- Those are remand cases.

[00:02:44] Speaker 03:
And he said, if the agency asks for a remand, we're going to judge it by these standards.

[00:02:49] Speaker 03:
I don't understand why we're talking about those pieces.

[00:02:52] Speaker 03:
What happened here is what, I don't know how long you have been doing this protest, but for at least two decades, if not more, agencies will sometimes take unilateral corrective action by canceling the contract award.

[00:03:06] Speaker 03:
And then sometimes they'll throw it out all together and say, we're going to send out a new solicitation.

[00:03:12] Speaker 03:
We're going to re-solicit.

[00:03:13] Speaker 03:
We're going to do a new set of criteria.

[00:03:15] Speaker 03:
We're going to do it all.

[00:03:16] Speaker 03:
That's been approved by Paul.

[00:03:20] Speaker 03:
why the situation here is any different.

[00:03:23] Speaker 01:
Your Honor, let me read a quote from Excel Gov, which is a case cited in our briefs by Judge Solomson.

[00:03:28] Speaker 01:
And I'll get to the answer.

[00:03:30] Speaker 01:
He says the Gov.

[00:03:30] Speaker 01:
Is it a remand case?

[00:03:32] Speaker 03:
I believe it's a corrective action case.

[00:03:34] Speaker 03:
Yes, but the agency asked for a remand to take corrective action.

[00:03:40] Speaker 01:
In that case, I will double check the answer to it.

[00:03:42] Speaker 01:
But either way, the case still applies.

[00:03:45] Speaker 01:
The government lacks.

[00:03:46] Speaker 03:
No, it doesn't.

[00:03:47] Speaker 03:
If it's not a request for a remand by the agency, if it's a unilateral corrective action, which they are entitled to take, and there's no legal, you can shake your head at me all you want, but that's not appropriate behavior at the podium for attorneys.

[00:04:01] Speaker 03:
If that's not something that's legally impermissible, then they're entitled to do it.

[00:04:05] Speaker 03:
What authority do you have that says an agency can't unilaterally cancel an award while protest is pending?

[00:04:14] Speaker 01:
Your honor, an agency can announce its intention to take corrective action and make a motion to the court.

[00:04:19] Speaker 01:
And that's not what happened here.

[00:04:21] Speaker 03:
What?

[00:04:22] Speaker 03:
No, we're not talking about that.

[00:04:25] Speaker 00:
Judges question is not going to corrective action.

[00:04:29] Speaker 00:
Judge Yu's question is going directly to the limitations, if any, on the government's ability to simply say, oh, we're going to cancel this and redo this.

[00:04:41] Speaker 00:
The government does that all the time.

[00:04:44] Speaker 01:
In the midst of litigation and a bid protest, the government can make a motion to the court.

[00:04:49] Speaker 03:
You keep saying that, but you have not cited a single procurement statute or regulation or a relevant case that says that.

[00:04:58] Speaker 01:
I understand, Your Honor.

[00:04:59] Speaker 03:
We're relying... We've cited cases where the government makes a motion for remand, and certain judges on the Court of Federal Claims have now started imposing a higher standard on whether it's going to agree to that motion or not.

[00:05:12] Speaker 03:
Those cases are fine.

[00:05:13] Speaker 03:
I mean, I'm not sure I agree with them, but those cases are a different case.

[00:05:16] Speaker 03:
The government did not move for a remand in this case, did it?

[00:05:20] Speaker 01:
Correct.

[00:05:21] Speaker 03:
It canceled the actions.

[00:05:23] Speaker 03:
And something it has been doing, I mean, the government cited in its brief, it has been doing this for decades.

[00:05:32] Speaker 03:
And nobody has questioned its ability to do that.

[00:05:36] Speaker 01:
your honor, respectfully, the government hasn't cited a single decision, couldn't cite a single decision where this exact fact pattern has ever happened.

[00:05:44] Speaker 01:
The government cited multiple cases and we responded where the agency announced a corrective action and then did one of the two things that we say you're allowed to do.

[00:05:53] Speaker 01:
One is to ask for a remand to implement corrective action, or to file a motion that the corrective action moots the protest.

[00:06:01] Speaker 03:
Do you think that the government has never, in response to a protest, just canceled the award and said, the award's done, and we're going to re-solicit without asking for permission?

[00:06:13] Speaker 01:
Your Honor, that has happened.

[00:06:14] Speaker 01:
Well, can I tell you what?

[00:06:15] Speaker 01:
I'm sorry, Your Honor, go ahead.

[00:06:17] Speaker 03:
So the government cancels an award and says, we're going to re-solicit.

[00:06:20] Speaker 03:
They don't have to ask for permission to do that, right?

[00:06:22] Speaker 01:
Your Honor, that's a different fact rather than what the war did.

[00:06:24] Speaker 03:
Well, that's what I don't understand.

[00:06:26] Speaker 03:
Sure.

[00:06:26] Speaker 03:
All they've done here is they've jammed all the steps together.

[00:06:31] Speaker 03:
And I know you don't like that.

[00:06:32] Speaker 03:
But if, in this case, instead of what they did, they canceled the awards, which they did, and they said, award stop.

[00:06:42] Speaker 03:
They went to the Court of Federal Claims and said, dismiss the case.

[00:06:44] Speaker 03:
We canceled all the awards.

[00:06:49] Speaker 03:
dismiss it, right?

[00:06:50] Speaker 01:
In that situation, Your Honor, that's likely what would happen, yes.

[00:06:54] Speaker 03:
And then the government comes back and says, we are reconstituting the selection panel with new people.

[00:07:01] Speaker 03:
We're going to relook at all these bids again.

[00:07:03] Speaker 03:
And then they come up with the decision, the same decision they come up with.

[00:07:07] Speaker 03:
They can do that, right?

[00:07:11] Speaker 01:
Your Honor, they can try to do that.

[00:07:13] Speaker 01:
And if plaintiffs have objections, they can raise them.

[00:07:16] Speaker 01:
The merits of that.

[00:07:17] Speaker 01:
Correct.

[00:07:17] Speaker 03:
They jam that all together.

[00:07:19] Speaker 03:
Is there anything impermissible with jamming it all together?

[00:07:23] Speaker 01:
The answer is yes, Your Honor.

[00:07:24] Speaker 01:
Let me explain.

[00:07:25] Speaker 03:
If you can point to me to a statute or regulation

[00:07:31] Speaker 03:
jamming it all together.

[00:07:32] Speaker 03:
I'm happy to hear it.

[00:07:33] Speaker 03:
You didn't cite anything in your brief that said that.

[00:07:35] Speaker 01:
Your Honor, I respectfully disagree with that.

[00:07:37] Speaker 01:
We cited the Supreme Court's decision in Regents.

[00:07:39] Speaker 03:
Regents is not applicable because even the case, Regents recognized that an agency can't supplement its reasoning to support an original decision, but it can come up, it can cancel that decision, and come up with another entirely new agency action.

[00:07:57] Speaker 03:
This is the second prong, not the first prong.

[00:08:01] Speaker 01:
your honor, an agency can do that on remand.

[00:08:04] Speaker 01:
It can't do that in the midst of litigation.

[00:08:06] Speaker 01:
That's the key lesson from regents.

[00:08:09] Speaker 03:
An agency decision reaching... But that's because the... No, first of all, I don't think that's the lesson of regents.

[00:08:15] Speaker 03:
But second, that's sometimes peculiar to

[00:08:18] Speaker 03:
APA rulemaking, too.

[00:08:20] Speaker 03:
An agency can't just cancel something that it's done through rulemaking without undergoing other rulemaking.

[00:08:27] Speaker 03:
You don't have anything in the bid protest area that says an agency has to go through some kind of formal procedure beyond issuing notices of termination for convenience, which you agreed they could do.

[00:08:41] Speaker 01:
Your Honor, let me describe just the facts as they laid out in this case.

[00:08:45] Speaker 01:
The agency didn't cancel the awards.

[00:08:47] Speaker 01:
and then attempt upon reconsideration of its evaluation to issue new awards.

[00:08:52] Speaker 01:
It's not what happened.

[00:08:53] Speaker 01:
In the midst of a protest, the agency altered the administrative record.

[00:08:57] Speaker 03:
No, that's just wrong.

[00:08:58] Speaker 01:
That's what happened, Your Honor.

[00:08:59] Speaker 03:
That's an inaccurate description of what happened.

[00:09:01] Speaker 03:
They did terminate for convenience.

[00:09:04] Speaker 03:
They terminated all 12 awards for convenience, right?

[00:09:09] Speaker 01:
After the reevaluation, Your Honor.

[00:09:11] Speaker 03:
Again, your dispute is with the steps in which they did it.

[00:09:16] Speaker 03:
But I don't see any real difference in the effect of what they did.

[00:09:20] Speaker 03:
They terminated the awards for convenience.

[00:09:24] Speaker 03:
And then they issued new awards.

[00:09:27] Speaker 03:
They didn't alter the record for the first one, because it was gone once it was canceled.

[00:09:33] Speaker 03:
Those awards are out once they're canceled.

[00:09:35] Speaker 03:
So the record for that, it doesn't matter.

[00:09:37] Speaker 03:
What matters is the record for the new awards.

[00:09:40] Speaker 03:
And maybe it's overlapping.

[00:09:43] Speaker 03:
Maybe they should have done it more cleanly.

[00:09:44] Speaker 03:
But it is a new decision with a new administrative record that you are free to protest and argue there.

[00:09:51] Speaker 03:
And the only way I think you get to challenge those determinations for convenience is if you have some bad faith arguments, which I don't think are present here, right?

[00:10:01] Speaker 01:
Your Honor, we didn't have to allege bad faith.

[00:10:03] Speaker 01:
We alleged a breach of good faith and fair dealing.

[00:10:06] Speaker 01:
If I could just explain the facts for one moment here, Your Honor.

[00:10:09] Speaker 01:
I'm familiar with the facts.

[00:10:11] Speaker 03:
I just think that you are making a distinction based on cases that aren't applicable, because there was no motion for a remand here.

[00:10:20] Speaker 01:
Your Honor, I agree there was no motion for a remand, but that's our entire point.

[00:10:23] Speaker 01:
I mean, Your Honor, to state it differently, for an agency to ask for a remand because it wants to reconsider, and as Your Honor knows, this court says in SKF USA,

[00:10:36] Speaker 01:
that an agency has to ask for that relief and has to prove that its interests in the remand are substantial and legitimate.

[00:10:42] Speaker 03:
Because in that case, they're asking to reconsider the original decision and come up with new reasons supporting that original decision.

[00:10:51] Speaker 03:
If what they had asked for was to cancel that decision or revoke that decision and issue a new decision, they don't have to.

[00:10:59] Speaker 03:
Frankly, getting stuff from the trade world is not particularly helpful, because there's a lot more statutes and regulations that govern commerce's conduct there and the steps they have to go through, rather than in bid protests.

[00:11:11] Speaker 01:
Well, Your Honor, I don't think it's a coincidence that several judges at the Court of Federal Claims have applied SKF, including in bid protest cases.

[00:11:18] Speaker 01:
I think it's a great decision, and I think those cases applying it are good decisions.

[00:11:22] Speaker 03:
For motions to remand.

[00:11:24] Speaker 03:
That's again, we have to accept.

[00:11:26] Speaker 03:
even if we accept the SKF standard, which this court has not approved of yet and did protest, it applies to most of the regents.

[00:11:32] Speaker 01:
Your Honor, if I may, by way of metaphor, if there is a secure facility to which I need access, and I know that I have to go to the gate and go to the guard and show my credentials in order to access that facility, to access, we'll use the verb access, I can't simply say, you know what, I don't want to do that, so what I'm going to do is I'm going to

[00:11:54] Speaker 01:
dig under the fence, avoid the guard, not show my credentials.

[00:11:58] Speaker 01:
And I won't call it accessing.

[00:11:59] Speaker 01:
I'll call it sashaying into the facility.

[00:12:02] Speaker 01:
These are just semantic games.

[00:12:03] Speaker 01:
What the government did.

[00:12:04] Speaker 03:
Yes, but you don't have a right.

[00:12:06] Speaker 03:
You don't have any right to enter the facility at all.

[00:12:08] Speaker 03:
We're not talking about that.

[00:12:10] Speaker 03:
We're talking about something that the agency has a right to do, which is terminate, for convenience, the award.

[00:12:17] Speaker 01:
Your Honor, the agency has a right to take corrective action.

[00:12:21] Speaker 01:
upon approval from the court after demonstrating its reasons.

[00:12:24] Speaker 01:
It doesn't have the unilateral right to dismiss an action.

[00:12:26] Speaker 03:
Do you think an agency doesn't have the unilateral right to terminate a contract or work for convenience if the bid protest is pending in court?

[00:12:36] Speaker 01:
Your Honor, the agency has that right and, of course, it's subject to protest.

[00:12:41] Speaker 01:
But what the agency doesn't have the right to do, which is exactly what happened here, which was to

[00:12:45] Speaker 01:
rewrite the administrative record in the midst of a protest after which they then terminated the contracts and after some amount of time, a few days, reissued the exact same paperwork.

[00:12:57] Speaker 01:
It was based on an administrative record that was altered in the midst of a pending protest in direct response to that protest.

[00:13:04] Speaker 01:
And let me just add, Your Honor, I hear what you're saying and I understand that you don't see an issue with this, but I want to

[00:13:11] Speaker 01:
there's a real Pandora's box possible here.

[00:13:14] Speaker 01:
If an agency can do this sort of thing, if in response to a pending protest, an agency can read the arguments, and in this case, by the way, there were some egregious problems with the record that was created, including the fact that the Technical Evaluation Team and Source Selection Board never reconvened to actually conduct the first reevaluation.

[00:13:36] Speaker 01:
All the agency did was transcribe, maybe one person transcribed post hoc rationalizations made by government council in the first protest into a new record.

[00:13:46] Speaker 01:
So having faced with new complaints about that failure of process and some substantive problems in the record, what the government did was they met over a teams meeting on one day and reissued paperwork ratifying their initial flawed reevaluation.

[00:14:02] Speaker 01:
If an agency can take a complaint or take a motion for judgment or take any document filed in the course of a protest and unilaterally change the record in the midst of the protest, to say that would frustrate judicial review is a significant understatement.

[00:14:18] Speaker 03:
You can protest the new board decisions that have the new record.

[00:14:23] Speaker 01:
Your Honor, where would that end?

[00:14:24] Speaker 01:
In the midst of the protest, an agency can unilaterally, whenever it wants to, alter the record?

[00:14:29] Speaker 03:
It's not altering the record.

[00:14:31] Speaker 03:
It is canceling the awards, having a new record.

[00:14:36] Speaker 03:
And I know this is overlapping records, to be sure, and issuing new awards.

[00:14:44] Speaker 01:
Your Honor, I commend to you that what this is is a game of semantics.

[00:14:48] Speaker 01:
To say it's not a remand case, or to say the agency has the right to take corrective action,

[00:14:53] Speaker 01:
It confuses the issues in this protest.

[00:14:56] Speaker 01:
What the agency did was unilaterally change the record in violation of Supreme Court precedents, in violation of SKF USA.

[00:15:04] Speaker 01:
They effectively remanded without permission from the court.

[00:15:07] Speaker 01:
They didn't meet the legal standard to do that.

[00:15:10] Speaker 01:
But I will note, again, that if agencies are allowed to do this, there would be no end.

[00:15:15] Speaker 02:
Mr. Ginsburg, you've used up all your time.

[00:15:18] Speaker 02:
We'll give you a little time for reflection.

[00:15:22] Speaker 02:
Thank you.

[00:15:22] Speaker 02:
Appreciate your time.

[00:15:36] Speaker 04:
Thank you, Your Honors, and may it please the Court.

[00:15:38] Speaker 03:
This Court should affirm the decision below.

[00:15:53] Speaker 04:
I know, Your Honor.

[00:15:54] Speaker 04:
What the government is arguing for here is the status quo of the government's understanding of how corrective action is permissible.

[00:16:01] Speaker 03:
So if one looks at- I mean, I don't want to interrupt you, but if that's what they're doing, if they're somehow saying, oh, well, there are these errors.

[00:16:10] Speaker 03:
We're going to cancel.

[00:16:11] Speaker 03:
We're going to redo it.

[00:16:12] Speaker 03:
If they keep prolonging that, at some point, if it's bad faith, then it's bad faith.

[00:16:18] Speaker 03:
And you can't do that, right?

[00:16:20] Speaker 04:
Bad faith is impermissible, but there's a presumption of regularity that we discussed in our brief.

[00:16:24] Speaker 04:
And this presumption that they're asking the court to adopt would invert that presumption into a presumption, whether they call it bad faith or a presumption of breach of good faith, that is not consistent with this court's precedent.

[00:16:35] Speaker 03:
I mean, the way you did this is a little hinky.

[00:16:38] Speaker 03:
I mean, it's done routinely that agencies terminate for convenience and then issue new decisions.

[00:16:44] Speaker 03:
It feels like the decision came, the reevaluation came before the termination for convenience, or that it was done all at the same time.

[00:16:55] Speaker 04:
The reason why this case is atypical is because there had already been the Allison decision from the court.

[00:17:00] Speaker 04:
And in the Allison decision, the agency had the benefit of the court's assessment of their prior evaluation.

[00:17:06] Speaker 04:
And then when the plaintiff filed the bid protest complaint, the agency reviewed the bid protest complaint

[00:17:11] Speaker 04:
and realize that a new evaluation needed to be made.

[00:17:14] Speaker 04:
And that's why the fact that the government did not issue a notice of intent to commit corrective action.

[00:17:20] Speaker 04:
and simply filed a notice of corrective action is because a lot of the analysis and arguments in agency evaluation had already been done.

[00:17:27] Speaker 04:
And that's why, as Your Honor mentioned during a conversation with my colleague, that's why everything was lumped more together.

[00:17:34] Speaker 02:
Did the contracts get canceled before or after that notice of corrective action was filed in court?

[00:17:41] Speaker 04:
The notice of corrective action and the contract cancellations all occurred on July 24.

[00:17:46] Speaker 02:
And why did the reevaluation occur first?

[00:17:52] Speaker 04:
The agency noticed, due to the filing of the complaints, that it needed to take corrective action.

[00:18:01] Speaker 04:
And so it conducted an evaluation and then informed the court within days of the first complaints being filed.

[00:18:08] Speaker 04:
and if you're on it seems like it would have been the better course when they realize they needed to do that to terminate all the awards for convenience right away and then do the evaluation there was a lot within the span of those few days and I believe there may have only been three three business days and there was a lot that was occurring and a lot of conversations that were happening at the same time and

[00:18:30] Speaker 04:
But the issue that is the issue before the court on appeal here is whether the government has the authority to take corrective action despite the filing of a bid protest complaint.

[00:18:40] Speaker 04:
And the parties agree that between the awarding of the contracts and the filing of a bid protest complaint, the government has the right to take corrective action.

[00:18:46] Speaker 04:
And counsel for CSI also agrees that after the protest complaint is filed, the government may take corrective action if the entirety of the corrective action would moot the complaint.

[00:18:56] Speaker 04:
So the issue that's limited here is whether or not there is any basis to say that the government's broad procurement authority to take corrective action is limited when the government would address only some of the issues raised in the complaint.

[00:19:10] Speaker 04:
And there is no authority that CSI has pointed to that would address that.

[00:19:13] Speaker 02:
One of the contracts here had never been canceled.

[00:19:16] Speaker 02:
Would the government be standing here saying, everything is OK?

[00:19:21] Speaker 02:
They didn't like our evaluation.

[00:19:23] Speaker 02:
We did a reevaluation that's better than the prior evaluation.

[00:19:27] Speaker 02:
So this case is over.

[00:19:32] Speaker 04:
I would argue it's possible that, yes, the government would still have the authority to take corrective action, because the case would then be moved.

[00:19:38] Speaker 04:
The government often provides a notice of intent to take corrective action.

[00:19:41] Speaker 02:
That would be altering the administrative record in real time, would it not?

[00:19:45] Speaker 04:
It would not, because here, Your Honor, the administrative record hadn't even been filed.

[00:19:49] Speaker 04:
All of these actions took place before the court's first status conference to address the schedule.

[00:19:54] Speaker 04:
I look to note, Your Honors, that the notice of corrective evidence.

[00:19:56] Speaker 03:
But that seems a little bit more problematic.

[00:19:59] Speaker 03:
That seems like it does fit within the first prong, which is the agency attempts to come up with a new rationale to support its decision while the case is still pending in court.

[00:20:10] Speaker 03:
I don't understand why you think you can do that.

[00:20:13] Speaker 03:
I mean, I think you can ask the court, you can look at the complaint and said, oh, yeah, we see some problems with this.

[00:20:18] Speaker 03:
We want to reevaluate without canceling, will you remand it?

[00:20:23] Speaker 03:
And then I think your opponent would be on much firmer ground in this argument, because that seems like post hoc rationalization for an award.

[00:20:35] Speaker 03:
But if you cancel the award, then there's no award.

[00:20:39] Speaker 03:
under protest.

[00:20:40] Speaker 03:
And so if you cancel, come up with a new evaluation and a new award, then they can protest that new evaluation.

[00:20:48] Speaker 03:
I guess I don't know why you're arguing for more than you probably should be arguing for.

[00:20:54] Speaker 04:
Well, in response to the context for the initial question, the government would just like to note that Regence is inapplicable.

[00:21:00] Speaker 04:
Regence was a remand case.

[00:21:01] Speaker 04:
and to address one of opposing counsel's points in his brief to make sure that it's addressed.

[00:21:06] Speaker 03:
No, but I think the Supreme Court would clearly hold that if an agency action is being challenged in court, the agency can't, during the pendency of that litigation, issue a new justification for that.

[00:21:21] Speaker 03:
I mean, that's an APA violation, just to accept that.

[00:21:23] Speaker 03:
And that's where I think you run into problems.

[00:21:26] Speaker 03:
if you just ask for further explanation without asking the court, can we remand this for a relook?

[00:21:36] Speaker 03:
But you don't have to do that here.

[00:21:38] Speaker 03:
And hopefully you're not going to do that in other cases.

[00:21:40] Speaker 03:
I mean, you canceled the awards.

[00:21:44] Speaker 03:
I mean, it's a fundamental principle of bid protest for decades that an agency can take unilateral corrective action by canceling awards.

[00:21:55] Speaker 02:
right your honor and that's what the agency agency canceled the awards here and it didn't issue new awards until later in my question is really trying to figure out the scope of what's the government's conception of what would be a permissible corrective action and would a permissible corrective action in your view be not canceling the awards keep sticking with the award but then improving the record in real time during the litigation by

[00:22:24] Speaker 02:
adding in a brand new evaluation on top of the one that was being challenged?

[00:22:31] Speaker 04:
I'm not aware of a basis in which, without the cancellation of the awards, we would be able to consider the decision.

[00:22:41] Speaker 02:
Just one thing I want to check on.

[00:22:44] Speaker 02:
Is it your view that APA principles apply here in the context of bid protest litigation?

[00:22:49] Speaker 04:
Well, I'd like to make clear that the Court of Federal Claims doesn't have jurisdiction over APA claims.

[00:22:53] Speaker 04:
However, the standard of review in bid protests is the arbitrary and capricious standard that's incorporated through the APA.

[00:23:00] Speaker 04:
And then I believe in this court's case in Bancor, it discusses the incorporation of that arbitrary and capricious standard and determines that ultimately it's a rational basis to the contracting officer of a rational basis.

[00:23:11] Speaker 02:
Right, but we were just talking briefly about regents and how it would likely be an APA violation if an agency was engaging in post-HOP rationalization to further improve its litigation position in the middle of a litigation.

[00:23:24] Speaker 02:
And I'm just wondering if you think those principles apply in the context of a big protest litigation.

[00:23:31] Speaker 04:
the basis for the principle.

[00:23:34] Speaker 04:
But just as an initial matter, I believe we may have cited the case of axiom 564 F.3D 1374 for the position.

[00:23:48] Speaker 04:
Apologies, Your Honor.

[00:23:55] Speaker 04:
I'm just trying to distinguish between what is an APA claim versus what's the incorporation of an APA standard.

[00:24:01] Speaker 04:
And with respect to the incorporation of an APA standard, I apologize, Your Honor, if you may repeat the question.

[00:24:07] Speaker 02:
Okay.

[00:24:08] Speaker 02:
Regents was talking, among other things, about how it's a violation of

[00:24:15] Speaker 02:
APA principles for an agency to engage in post hoc rationalization to defend an already final agency action by improving on the record in somehow some form or fashion or adding additional rationales during the midst of a litigation challenging the agency underlying agency action.

[00:24:37] Speaker 02:
And I'm asking you whether you think that principle

[00:24:42] Speaker 02:
applies in the context of a bid protest litigation.

[00:24:49] Speaker 04:
Putting aside the origins of the principle, with respect to the principle of post-hoc rationalizations, I'm not aware of anything that would say it wouldn't apply in the context of bid protest litigation.

[00:24:59] Speaker 04:
But as the Supreme Court held in Biden v. Texas, that was a case in which there had been a new decision that was made.

[00:25:05] Speaker 04:
Then we were in a, quote, regents' situation too, which is what the court below found would be more analogous to the situation we have here.

[00:25:15] Speaker 04:
And what we have here, because it was a new decision, because the contract

[00:25:19] Speaker 04:
were terminated, and the new awards were issued, and the agency based its decision on a new evaluation.

[00:25:25] Speaker 04:
CSI makes a lot of arguments about turning square corners.

[00:25:27] Speaker 04:
This is good governance.

[00:25:28] Speaker 04:
This is turning square corners.

[00:25:30] Speaker 04:
This is the agency reviewing the protests and not forcing the courts and the parties to live here before the court took an inefficient motion for remand.

[00:25:38] Speaker 04:
The agency was aware that it needed to conduct a new evaluation, and it did so.

[00:25:44] Speaker 04:
And the parties, to a certain extent, benefited.

[00:25:47] Speaker 04:
And as Judge Hughes mentioned earlier,

[00:25:49] Speaker 04:
I would like to challenge the new decision on its face.

[00:25:53] Speaker 04:
It retains the ability to do so.

[00:25:55] Speaker 04:
And in fact, that's why they amended their complaint in this matter in order to challenge that decision as well.

[00:26:04] Speaker 04:
In addition, Your Honors, moving on from the corrective action, the broken human authority that the government has with respect to corrective actions, but before we transition, I'd like to mention that in CSI's brief, the government discusses that the authority to reconsider is inherent in the authority to decide.

[00:26:19] Speaker 04:
That was the case of Tokyo.

[00:26:21] Speaker 04:
TKS is what's commonly referred to in the case law.

[00:26:24] Speaker 04:
And in that case, those principles are applicable here.

[00:26:27] Speaker 04:
CSI does not dispute that the government had the authority to issue any of the decisions that it had here.

[00:26:33] Speaker 04:
But it had the authority to reconsider the decisions, absent some statutory exception to the contrary.

[00:26:39] Speaker 04:
If you look at the Tucker Act, that provides jurisdiction to the Court of Federal Claims.

[00:26:42] Speaker 04:
You'll also see that there's principles of efficient justice in terms of processing the bid protests.

[00:26:48] Speaker 04:
If you look to Rule 1 of the Rules of Court of Federal Claims, they say again that efficiency

[00:26:53] Speaker 04:
is also to be taken into account.

[00:26:55] Speaker 04:
And the corrective action procedure that the government uses is consistent with all of that.

[00:26:59] Speaker 04:
However, in CSI's brief, they don't respond to the Tokyo principle, and I think that's telling.

[00:27:06] Speaker 04:
And in addition, moving on, we'd just like the court to address the Keltner standard that the CSI has raised.

[00:27:14] Speaker 03:
We don't have to address that, though, do we?

[00:27:15] Speaker 03:
That's not relevant to this case, because this is an Arrhenia case.

[00:27:19] Speaker 03:
I understand the government has a beak with that line of cases, and that it's imposing what you think is a stricter standard on motions to compel or a motion to remand.

[00:27:30] Speaker 03:
But since this isn't a remand case, why would we address that?

[00:27:34] Speaker 04:
Yes, Your Honor.

[00:27:35] Speaker 04:
We agree that this court does not need to reach that question.

[00:27:38] Speaker 04:
However, there's four quick reasons why the court may be inclined to do so.

[00:27:42] Speaker 04:
As demonstrated, I think the court is not

[00:27:45] Speaker 03:
or at least this member of the court is not inclined to issue advisory opinions to the Court of Federal Appliance.

[00:27:52] Speaker 03:
When those cases come back to bite you and you want an appeal, I think you can bring them in.

[00:27:57] Speaker 04:
Well, that's one of the issues, Your Honor.

[00:27:58] Speaker 04:
This is a standard that does tend to evade review.

[00:28:01] Speaker 04:
If the government survives the compelling justification standard, then the government would not appeal that decision.

[00:28:05] Speaker 04:
And if the government does not survive that standard, then further.

[00:28:08] Speaker 03:
Well, maybe you can actually make that argument in a case that involved a remand, not the one that does

[00:28:17] Speaker 04:
Just one last point, if I may, Your Honor.

[00:28:19] Speaker 04:
There does appear to be an intra-court split among the judges of the Court of Federal Claims that there would be additional clarity if this court indicated that the Keltner incorporation of ad hoc groups, incorporation of shake proof, it was not a proper reading of SKF.

[00:28:38] Speaker 04:
If your honors have no further questions, the government would just like to note that this court should not permit the filing of the bid protest complaint to divest the government of authority to take corrective action.

[00:28:51] Speaker 04:
The government acted within the bounds of its broad procurement authority as a matter of law and as a matter of good governance.

[00:28:58] Speaker 02:
Thank you.

[00:29:00] Speaker 02:
Thank you.

[00:29:01] Speaker 02:
Mr. Pierce.

[00:29:05] Speaker 02:
Give Mr. Ginsburg three minutes.

[00:29:10] Speaker 01:
Thank you, Your Honors.

[00:29:11] Speaker 01:
Just briefly, if this case involves the status quo as the government states, I'm curious why the government couldn't cite a single decision of the Court of Federal Claims where this has ever happened before.

[00:29:22] Speaker 01:
If you look in our reply brief and our responsive footnotes at pages 7 through 9, 7 through 10, we responded to every single one of the dozens of cases cited by the government and not a single one of them involved changing the

[00:29:38] Speaker 01:
We're re-evaluating in the midst of a protest and attempting to pass that new evaluation off to the trial court as the new reasoned and considered judgment of the agency.

[00:29:48] Speaker 01:
It's never happened as far as we can detect.

[00:29:52] Speaker 01:
And there's a reason.

[00:29:53] Speaker 01:
It's not a coincidence.

[00:29:54] Speaker 00:
Does the cancellation of the original bid change the equation and distinguish over all of those cases?

[00:30:05] Speaker 01:
Your Honor, I think it does distinguish against all of those cases.

[00:30:11] Speaker 00:
But... Because those cases deal with the remand or request to reconsider or some such thing.

[00:30:17] Speaker 00:
Exactly.

[00:30:17] Speaker 00:
Without seeking permission.

[00:30:19] Speaker 00:
But the fact that in this case, ignoring for the moment the specific timing of when it happened, there was a cancellation.

[00:30:32] Speaker 00:
for convenience, and the government has an absolute right to do that, does it not?

[00:30:38] Speaker 01:
Your Honor, it doesn't have the right to do it following a re-evaluation where it's already shown its hand as far as what the next evaluation will be.

[00:30:47] Speaker 00:
It doesn't?

[00:30:49] Speaker 00:
I don't know, I'm unaware of any

[00:30:52] Speaker 00:
limitation on the government's ability to terminate for convenience.

[00:30:56] Speaker 03:
So is your belief that they did the re-evaluation and then terminated for convenience and re-awarded?

[00:31:03] Speaker 03:
If they terminated for convenience at noon, did the re-evaluation at two, re-awarded at four, is that okay?

[00:31:14] Speaker 01:
Your Honor, under that fact pattern, which is similar to this fact pattern, I don't see how

[00:31:20] Speaker 01:
that re-evaluation could be the fair and considered judgment of the agency.

[00:31:24] Speaker 03:
You can challenge that re-evaluation that results in a new award as either the product of bad faith or also insignificant, but it's not the procedure that you're challenging, it's the actual merits of the re-evaluation, which you can do here too.

[00:31:42] Speaker 01:
Your Honor, I agree.

[00:31:44] Speaker 01:
If you look at our that our grounds for appeal our second gravity focused on our second ground for appeal for a minute breach of good faith and fair dealing I mean you didn't bring that up on your opening.

[00:31:53] Speaker 03:
Is it really fair to bring that up when he didn't get a talk about it?

[00:31:56] Speaker 01:
I'd be happy to offer you more time.

[00:31:59] Speaker 01:
I think it's fully briefed but but the fact is this the The fact is is this is that?

[00:32:06] Speaker 03:
The court of federal claims the court didn't find any bad faith here did it?

[00:32:10] Speaker 01:
We didn't allege bad faith.

[00:32:11] Speaker 01:
It's a breach of the duty to be fairly and honestly considered, which doesn't require a breach of that either.

[00:32:16] Speaker 01:
Right.

[00:32:17] Speaker 01:
And our point is that that was error.

[00:32:20] Speaker 02:
You have an amended complaint now, right, challenging the new award, right?

[00:32:26] Speaker 02:
So at least you've got that.

[00:32:29] Speaker 02:
I'm sorry.

[00:32:30] Speaker 02:
You're on.

[00:32:31] Speaker 02:
There's been a new contract award, right?

[00:32:34] Speaker 01:
I was aware of contracts yes and once again you did not get an award of a contract and I assume you're challenging that award have have challenged and you have that that that those that litigation is completed already but but you're all right the results of that well that's that's the that's the challenge being did you win it up

[00:32:59] Speaker 03:
Or were there new awards upheld?

[00:33:00] Speaker 01:
No, I'm sorry.

[00:33:02] Speaker 01:
I think the posture of this is getting confused.

[00:33:05] Speaker 01:
I'm asking about it.

[00:33:06] Speaker 01:
Those were the decisions that are on appeal here.

[00:33:07] Speaker 03:
This is this case.

[00:33:08] Speaker 01:
It's this case, yes.

[00:33:09] Speaker 03:
He didn't document it as a separate case than what he could have.

[00:33:12] Speaker 03:
He upheld the results of the new awards.

[00:33:16] Speaker 01:
Correct.

[00:33:17] Speaker 01:
Yes.

[00:33:18] Speaker 01:
Correct.

[00:33:18] Speaker 01:
And our point is that at no point was canned soft tech or the other plaintiffs in this case given a fair and reasoned re-evaluation.

[00:33:29] Speaker 02:
Have you appealed that decision by the claims court, which upheld the new award?

[00:33:36] Speaker 02:
That is this appeal.

[00:33:36] Speaker 02:
That's this appeal?

[00:33:37] Speaker 02:
Yeah.

[00:33:38] Speaker 03:
Well, I thought this appeal was- It's the second part of your brief.

[00:33:41] Speaker 03:
You just didn't talk about it in your opening argument.

[00:33:46] Speaker 01:
I think so.

[00:33:47] Speaker 01:
I think these issues are intertwined.

[00:33:49] Speaker 01:
And let me just quickly explain that with the brief.

[00:33:52] Speaker 02:
I think time is up.

[00:33:54] Speaker 02:
We've got to move on.

[00:33:55] Speaker 02:
Thank you very much.

[00:33:56] Speaker 02:
Case is submitted.