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National Mall Tours of Washington, Inc. v. United States Department of the Interior

United States Court of Appeals, District of Columbia Circuit

July 7, 2017

National Mall Tours of Washington, Inc., Appellant
United States Department of the Interior, et al., Appellees

          Argued April 7, 2017

         Appeal from the United States District Court for the District of Columbia (No. 1:15-cv-00529) Kevin R. Garden argued the cause and filed the briefs for appellant.

          Brian J. Field, Assistant U.S. Attorney, argued the cause for federal appellees. With him on the briefs were R. Craig Lawrence and Alexander D. Shoaibi, Assistant U.S. Attorneys.

          Frank S. Swain argued the cause and filed the brief for appellee City Sightseeing Washington D.C., Inc.

          Before Tatel and Wilkins, Circuit Judges, and Silberman, Senior Circuit Judge.


          Wilkins, Circuit Judge.

         Appellant National Mall Tours of Washington, Inc. ("National Mall Tours") competed with City Sightseeing Washington D.C., Inc., doing business as "Big Bus Tours, " for a highly coveted 10-year concession contract with the Park Service that would allow it to provide guided tours on the National Mall. Big Bus Tours won the contract. National Mall Tours sued the U.S. Department of Interior, Secretary Sally Jewell, the National Park Service, and Director of Park Service Jonathan Jarvis (collectively, the "Park Service") in the District Court under the Administrative Procedure Act and the National Park Service Concessions Management Improvement Act of 1998, 54 U.S.C. § 101911 et seq. ("Concessions Act"). National Mall Tours challenged the agency's decision to proceed with the award of the contract to Big Bus Tours despite the fact that Big Bus Tours underwent a change of ownership midway through the award process. National Mall Tours also challenged the agency's failure to notify two congressional committees of the proposed concession contract between the Park Service and Big Bus Tours, as allegedly required by the Concessions Act. The parties submitted cross-motions for summary judgment. The District Court ruled in favor of the Park Service and dismissed the action. This appeal followed.


         We begin by examining the legal framework governing awards of concession contracts and then turn to what happened in this case.


         The 1998 Concessions Act and accompanying Park Service regulations govern the competitive process by which the agency solicits proposals and awards concession contracts for visitor services on the National Mall. Generally, the Park Service issues a prospectus, bidders (known as "offerors") respond by submitting proposals, and the Park Service then selects the winning proposal. The Concessions Act provides certain minimum standards the Park Service should follow along the way and affords the agency discretion to determine whether those standards are met.

         The Concessions Act instructs the Park Service to select the offeror with the "best proposal, as determined by the Secretary through a competitive selection process, " 54 U.S.C. § 101913(1), with reference to various criteria including statutorily enumerated Principal Selection Factors, id. §§ 101913(1), (5)(A); see 36 C.F.R. § 51.16. For example, Principal Selection Factor 3 considers the "experience and related background" of the offeror, and Principal Selection Factor 4 considers "the financial capability" of the offeror to carry out its proposal. 54 U.S.C. § 101913(5)(A)(ii)-(iii). The Park Service must take these and other factors into account when determining which offeror has the "best" proposal. Id. § 101913(5)(A). The Concessions Act also provides certain grounds for which the Park Service "shall reject, " or not even "consider[]" proposals, when the Park Service "determine[s]" that an offeror fails to meet certain standards. Id. § 101913(4)(A)-(B).

         Relevant here, Park Service regulations provide that the agency will reject a proposal when it "determin[es]" the proposal is not "responsive." 36 C.F.R. § 51.18. A "responsive proposal" is one that the Park Service has "determined" "provide[s] the information required by the prospectus, " among other things. Id. § 51.3. This does not mean a proposal lacking any requisite minutiae will necessarily be rejected. Rather, the agency approaches missing information with a view toward its materiality - that is, the information that it considers to be "required by the Prospectus" is that which is both "expressly required by the Prospectus and . . . material, as determined by the Service, to an effective evaluation of the proposal under the applicable selection factor." Prospectus, J.A. 311 (emphasis added). Importantly, once proposals are submitted, offerors are generally prohibited from amending or supplementing their proposals. See 36 C.F.R. § 51.15(a). Thus, omissions can be fatal if the Park Service deems them material.


         In October 2014, the Park Service issued a Prospectus soliciting proposals for a 10-year concession contract on the National Mall. The Prospectus called for all proposals to be submitted by December 12, 2014. At the time, Big Bus Tours served as a temporary concessioner with its contract set to expire on March 31, 2015.

         Three companies supplied proposals for the contract - Big Bus Tours, City Sights D.C., and National Mall Tours. The Park Service's Evaluation Panel reviewed all three proposals, scored them, and ultimately recommended that the agency select Big Bus Tours to be the concessioner on the new contract. Park Service management approved the recommendation, agreeing Big Bus Tours had the best proposal. On March 15, 2015, the agency informed each bidder of its decision and sent Big Bus Tours a copy of the proposed contract for its signature.

         On March 19, after learning it would lose the bid, National Mall Tours interjected with an email to a Park Service manager: "Are you aware that Big Bus was sold in February of this year? Do you know who you are dealing with at this point?" The email alluded to the recent acquisition by Exponent Private Equity Partners III LP of 60% of the outstanding equity of Big Bus Tours Ltd. ("Big Bus UK"), which was the United Kingdom-based ...

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