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Georgia Vocational Rehabilitation Agency Business Enterprise Program v. United States

United States District Court, E.D. Virginia, Newport News Division

December 11, 2018

GEORGIA VOCATIONAL REHABILITATION AGENCY BUSINESS ENTERPRISE PROGRAM et al, Plaintiffs,
v.
UNITED STATES OF AMERICA, Defendant.

          OPINION & ORDER

          HENRY COKE MORGAN, JR. SENIOR UNITED STALES DISTRICT JUDGE

         This matter comes before the Court on Georgia Vocational Rehabilitation Agency Business Enterprise Program ("GA-SLA") and Michael C. Lee's ("Mr. Lee") (collectively "Plaintiffs'") Motion for Temporary Restraining Order (the "Motion"). Doc. 2. A hearing in this matter was held on Tuesday, December 4, 2018 at 11:00 a.m. For the reasons stated below, the Court GRANTED Plaintiffs' Motion.

         I. BACKGROUND

         A. Factual Allegations

         Plaintiffs[1] bring this action pursuant to the Randolph-Sheppard Act ("RSA") and Army Regulation ("AR") 210-25 against the United States of America, by and through the Honorable James N. Mattis, Secretary of Defense, The Honorable Mark Thomas Esper, Secretary of the Army, and Contracting Officer Rhoda C. Harrison-Spence, (collectively "the Government"). See Compl. Both the RSA and AR 210-25 provide priority for blind persons in the operation of vending facilities on Federal property. Compl. ¶ 1. Plaintiffs are currently performing the food services contract at Fort Benning and have been doing so "for over fifteen (15) consecutive years." Id. ¶31. Plaintiffs entered into its most recent food services contract with the Government in July of 2016. The contract was awarded based on Plaintiffs' competitive bid and provided for a one-year contract with two optional renewal periods. The Government exercised the first option to renew and renewed the contract for an eleven-month period. However, the Government decided not to exercise the second option to renew and instead solicited new bids for a multi-year food services contract (the "Solicitation").

         The contract was to be awarded by contracting officer, Rhoda C. Harrison-Spence (the "Contracting Officer"), who is Mission and Installation Contract Command at Fort Eustis, VA. Id. GA-LSA submitted a proposal on behalf of Mr. Lee in response to the Solicitation. Compl. ¶¶ 24. On August 17, 2018, the Contracting Officer rejected the GA-LSA's proposal because their "price was determined to be unreasonably high." Compl. ¶ 25[2].

         On November 26, 2018, Plaintiffs filed a complaint for arbitration with the Secretary of Education. Doc. 1-3 ("Compl. Ex. C"). Plaintiffs claim that the Contracting Officer violated the RSA by failing to consult with the Secretary of Education before denying Plaintiffs' proposal, Compl. ¶28, which failure is governed in the improper computation of the competitive range of bids.

         B. Procedural History

         On August 17, 2018, the Government rejected Plaintiffs' proposal. On August 22, 2018, Plaintiffs filed a protest with the Government Accountability Office ("GAO") challenging their exclusion, which triggered a stay preventing the Government from awarding the contract to someone else. Doc. 12-1 ("Spence Decl.") ¶ 9. On November 23, 2018, the GAO dismissed Plaintiffs' protest. Id. On November 26, 2018, Plaintiffs filed a complaint for arbitration with the Secretary of Education and filed a complaint for Temporary Restraining Order and Preliminary Injunction with this Court. Compl.

         On November 27, 2018, Plaintiffs filed their Motion for Temporary Restraining Order. Doc. 2. The Government appeared in the matter and filed a Notice on November 29, 2018. Docs. 6, 7. On November 30, 2018, this Court entered an Order requiring the Government to file its response on or before 12:00 p.m. on December 3, 2018, and on December 3, 2018 the Government promptly filed its response. This matter was heard on December 4, 2018 at 11:00 a.m.

         II. LEGAL STANDARD

         Under Rule 65 of the Federal Rules of Civil Procedure, the court may issue a preliminary injunction after notice has been provided to an adverse party. Fed.R.Civ.P. 65. "The standard for granting either a TRO or a preliminary injunction is the same." Sarsour v. Trump. 245 F.Supp.3d 719, 728 (E.D. Va. 2017). Like a preliminary injunction, a temporary restraining order is an 'extraordinary remed[y] involving the exercise of a very far-reaching power to be granted only sparingly and in limited circumstances." Id.

         Accordingly, for the Court to grant a motion for a temporary restraining order the moving party must demonstrate "that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest." Id. (citing Winter v. Natural Res. Def. Council Inc.. 555 U.S. 7, 24 (2008)) (internal quotations omitted): see also Pashby v. Delia. 709 F.3d 307, 320-21 (4th Cir. 2013) (each element of the test must be satisfied). "A party seeking preliminary injunction ... must clearly show that it is likely to succeed on the merits." Sarsour. 245 F.Supp.3d at 729 (alterations and quotation marks omitted). Irreparable harm means harm that is "neither remote nor speculative, but actual and imminent." Direx Israel. Ltd. v. Breakthrough Med. Corp.. 952 F.2d 802, 812 (4th Cir. 1991). When evaluating whether to issue an injunction, a court "should pay particular regard for the public consequences in employing the extraordinary remedy of injunction." Winter. 555 U.S. at 24.

         III. ANALYSIS

         A. Summary of Argument

Plaintiffs move this Court to enter an Order temporarily restraining the Government from:
(a) moving forward with the procurement process with respect to the subject Solicitation, including but not limited to making award of a contract to an offeror other than the GA-SLA, entering into such a contract, or initiating performance under such contract until
(i) a hearing has been held on a preliminary injunction and the Court's orders with respect thereto have been issued,
(ii) an arbitration pursuant to the Randolph-Sheppard Act ("R-S Act") has been conducted and the R-S Act arbitration panel has issued a decision with respect to the GA-SLA's Complaint for Arbitration alleging the Army's violation of the R-S Act arbitration decision, and
(iii) the Court has had the opportunity to review said decision as a final agency action in accordance with the Administrative Procedure Act, 5 U.S.C. §§ 701 et seq. and issued orders with respect thereto; and
(b) awarding a contract to an offeror other than GA-SLA until (i) a hearing on preliminary injunction and the Court's orders with respect thereto as to whether the Army has fully complied with Army Regulation 210-25, subparagraph 6.b. (1)(c), particularly as regards the requirement for the Army's requesting, receiving, and complying with the approval or ...

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