            In the United States Court of Federal Claims
                                          No. 10-878C
                                          Bid Protest
                                    (Filed: April 30, 2014) 1
                                   (Reissued: May 30, 2014)

************************                      *
                                              *
COMMUNICATION CONSTRUCTION                    *
SERVICES, INC.,                               *
                                                    Post-award Bid Protest; 28 U.S.C.
                                              *
                                                    § 1491(a)(1) Jurisdiction;
                      Plaintiff,              *
                                                    Nonappropriated Fund Instrumentality
                                              *
                                                    (“NAFI”); Army and Air Force
       v.                                     *
                                                    Exchange Service Procurement; Blue &
                                              *
                                                    Gold Waiver; Supplementation of
THE UNITED STATES,                            *
                                                    Administrative Record; Breach of
                                              *
                                                    Implied Duty of Fair Dealing; 10 U.S.C.
              Defendant,                      *
                                                    § 2492a; Organizational Conflict of
                                              *
                                                    Interest; Responsibility Determination;
       and                                    *
                                                    Technical Evaluation; Fee Evaluation;
                                              *
                                                    Appearance of Impropriety;
RESOLUTE PARTNERS, LLC,                       *
                                                    Indebtedness of Awardee.
                                              *
              Intervenor.                     *
                                              *
************************                      *


       Richard P. Rector, DLA Piper, LLP (US), 500 Eighth Street, NW, Washington, D.C.
20004, for Plaintiff. Seamus Curley, Samuel B. Knowles, Dionis M. Gauvin, and Nedra S.
Adams, DLA Piper, LLP (US), 500 Eighth Street, NW, Washington, D.C. 20004, of Counsel.

       Stuart F. Delery, Jeanne E. Davidson, Steven J. Gillingham, and Alexis J. Echols, United
States Department of Justice, Civil Division, Commercial Litigation Branch, P.O. Box 480, Ben
Franklin Post Office, Washington, D.C. 20044, for Defendant.

      Joseph P. Hornyak, Holland and Knight LLP, 1600 Tysons Boulevard, Suite 700,
McLean, VA 22102, for Intervenor. Megan M. Jeschke and Jacob W. Scott, Holland and Knight
LLP, 1600 Tysons Boulevard, Suite 700, McLean, VA 22102, of Counsel.



       1
         The Court issued this opinion under seal on April 30, 2014, and directed the parties to
file proposed redactions by May 14, 2014. The Court publishes this opinion adopting the
proposed redactions. Redactions are indicated by brackets “[ * * * ].”
_____________________________________________________________________________

    OPINION AND ORDER GRANTING DEFENDANT’S AND INTERVENOR’S
       MOTIONS FOR JUDGMENT ON THE ADMINISTRATIVE RECORD
_____________________________________________________________________________

WILLIAMS, Judge

        Plaintiff, Communication Construction Services, Inc. (“CCS”) challenges the Army and
Air Force Exchange Service’s (“AAFES”) award of a contract for internet and
telecommunications services to Resolute Partners, LLC (“Resolute”).               AAFES, a
nonappropriated fund instrumentality of the United States Government (“NAFI”), provides
merchandise and services to active duty and reserve military members and their families.
AAFES’ earnings support the Army’s Family Morale Welfare and Recreation Command
(“FMWRC”) programs. CCS brings this bid protest invoking this Court’s general contract
jurisdiction, 28 U.S.C. § 1491(a), claiming that Defendant breached its implied duty to fairly
consider CCS’ proposal. This matter comes before this Court on CCS’ motion for summary
judgment and Defendant’s and Intervenor’s motions for judgment on the Administrative Record
(“AR”). CCS seeks its proposal preparation costs and an order remanding the procurement to
AAFES.

        CCS presents five grounds of protest. First, CCS claims that the Army Recreation
Machine Program (“ARMP”), a subsidiary of FMWRC, acted as subcontractor to the awardee,
Resolute, in violation of 10 U.S.C. § 2492a. This statute prohibits Department of Defense
(“DoD”) entities from offering or providing telecommunications services to consumers for a fee
and from competing for contracts to provide such services. Second, CCS claims that FMWRC’s
role in the procurement created an organizational conflict of interest (“OCI”) because FMWRC
shaped the solicitation and participated in the source selection process, and because FMWRC’s
subsidiary, ARMP, competed in the procurement as a subcontractor to the awardee. Third, CCS
argues that the technical and price evaluations conducted by AAFES were unreasonable and
contrary to the terms of the solicitation. Fourth, CCS contends that AAFES improperly
determined that Resolute was a responsible contractor. Lastly, CCS claims that an appearance of
impropriety tainted the competition because Resolute was indebted to AAFES and AAFES
considered this debt in making the award decision.

       The Court denies the protest. CCS waived its statutory violation and OCI claims because
it knew the grounds for those claims prior to award but failed to timely raise them. The
evaluation of proposals and responsibility determination were reasonable, and CCS failed to
demonstrate that either an OCI or an appearance of impropriety tainted the competitive process.




                                              2
                                       Findings of Fact 2

Information Services Provided on Air Force and Army Installations

        There are two kinds of information services provided on Air Force and Army
installations, Personal Information Services and FMWRC Information Services. See AR 4, 119,
366. Personal Information Services include “for-fee” internet, telephone, and television services
paid for by civilian or military personnel for personal use -- for “unofficial services” -- in
barracks, housing, and internet cafes. AR 334, 362, 427-28, 1776. Prior to December 2009, both
AAFES and FMWRC provided “for-fee” internet services on Army and Air Force installations.
AR 119, 366. AAFES provided the services through contracts with internet service providers
(“ISP”), while FMWRC utilized a government-owned infrastructure operated by ARMP to
provide the services. AR 2, 119, 366. This protest arose after FMWRC and AAFES executed an
agreement to transfer management, sale, and operation of the for-fee internet services to AAFES.
AR 4-7.

        The FMWRC Information Services supported “official” business functions where users
do not pay a fee, and ARMP provided these free services using the FMWRC Information
Services network, a telecommunications system of government-owned utilities and infrastructure
-- the same infrastructure ARMP used to provide Personal Information Services. AR 1, 2, 334,
427; see AR 119, 366, 8768, 8808, 8822, 8836.

Legislative and Regulatory Changes Regarding the Provision of Personal Information
Services

        On February 23, 2009, AAFES and FMWRC entered into a Memorandum of
Understanding (“MOU”) to “establish a non-competitive partnership between AAFES and
FMWRC to provide common levels of personal information services based on best business
practices and cost benefit analysis that minimizes the cost of services to individual users.” AR
9158; see AR 9158-62. The MOU stated that the partnership would be “executed” in accordance
with implementing instructions that would “describe the detailed responsibilities” of each
partner. AR 9159.

        On May 11, 2009, Army, AAFES, and DoD officials met with the House Armed Services
Committee (“House Committee”) concerning the proposed plan to transfer all Personal
Information Services operations and related contracts to AAFES. See AR 10537. In a letter
dated May 22, 2009, the House Committee approved this plan and provided the following
direction:

       The Committee views military resale and nonappropriated fund business activities
       as government entities that must not compete directly with private sector


       2
         These findings are derived from the AR as supplemented. As explained below, the
Court issues findings of fact because it resolves the protest on motions for judgment on the AR,
not motions for summary judgment. Findings of fact related to the evaluation and the alleged
organization conflict of interest are included in the discussion.


                                               3
       enterprises capable of providing the desired services. In this regard, the
       Committee directs that within the Department of Defense, no DoD entity may
       either provide personal information services using DoD resources, personnel or
       equipment, or compete for contracts to provide such services when the intent is to
       charge users to recover cost or to earn profits. This prohibition does not prevent
       or preclude the use of DoD personnel, resources or equipment to administer and
       oversee personal information services contracts, nor does it preclude [AAFES]
       from carrying out the plan to provide personal information services through
       contractors as approved by the Committee.

AR 10531.

       The final version of the National Defense Authorization Act for Fiscal Year 2010
incorporated the House Committee’s directive. See Pub. L. 111-84, § 651, 123 Stat. 2368. Now
codified at 10 U.S.C. § 2492a, this legislation became effective on October 28, 2009, and
provides:

       (a) Limitation.—(1) Notwithstanding section 2492 of this title, the Secretary of
       Defense may not authorize a Department of Defense entity to offer or provide
       personal information services directly to users using Department resources,
       personnel, or equipment, or compete for contracts to provide such personal
       information services directly to users, if users will be charged a fee for the
       personal information services to recover the cost incurred to provide the services
       or to earn a profit.

       (2) The limitation in paragraph (1) shall not be construed to prohibit or preclude
       the use of Department resources, personnel, or equipment to administer or
       facilitate personal information services contracts with private contractors.

                                             ***

       (c) Personal Information Services Defined.—In this section, the term “personal
       information services” means the provision of Internet, telephone, or television
       services to consumers.

10 U.S.C. § 2492a (Supp. III 2009).

     On December 24, 2009, FMWRC and AAFES finalized a Memorandum of Agreement
(“MOA”) implementing the requirements of § 2492a. AR 4-7. The December MOA provided:

       AAFES will be responsible for provisioning for-fee Internet services on Military
       Installations through a commercial Internet Service Provider (ISP).

       FMWRC will transfer for-fee internet service programs currently operated by
       ARMP to AAFES on a mutually agreed upon schedule that minimizes disruption
       to the customer. All transfers must be completed by 31 December 2010.



                                               4
                                              ***

       To the extent that AAFES’ commercial ISP[s] can provide their own
       infrastructure to maintain connectivity at existing locations they may do so.
       Otherwise, AAFES’ ISP[s] will have the option of using ARMP provided
       resources.

                                              ***

       The level of ARMP Internet Services provided to the AAFES ISP will meet or
       exceed current service levels.

       [FMWRC will] [o]ffer to sell or lease existing Internet assets dedicated to
       Personal Information Services . . . directly to AAFES’ ISPs at a negotiated value
       where AAFES’ ISPs intend to use existing assets and/or infrastructure to deliver
       the Internet services to a location.

AR 5-6. To implement this “transfer of function,” AAFES was to “competitively award and/or
modify existing contracts for for-fee Internet services transferred from FMWRC to AAFES.”
AR 6. The December MOA further stated: “There will be no transfer of Internet assets from
FMWRC to AAFES as a component of this agreement. FMWRC through [its] ARMP program
will offer Internet network services as an option to AAFES’ ISP[s] for a fee.” AR 7.

CCS’ and Resolute’s Bridge Contracts

       As part of the transfer of Personal Information Services from FMWRC to AAFES,
ARMP awarded CCS a bridge contract on May 4, 2010, to use ARMP’s network infrastructure
and equipment to provide Personal Information Services for consumers at 318 building locations
on military installations. AR 1867-92. CCS’ bridge contract was set to terminate on November
30, 2011. AR 1868, 1875. The bridge contract provided that ARMP planned to use its network
to provide bandwidth for personal information services, as it had before the bridge contract. AR
1869-70.

        On July 10, 2010, ARMP entered into a similar bridge contract with Intervenor Resolute,
that covered 243 buildings. See AR 2025-45.

The Instructions for Personal Information Services Implementation on FMWRC’s Website

        “Implementation Instructions” were issued to “provide a centralized reference document”
in support of the MOU governing the AAFES/FMWRC “non-competitive partnership” to
provide Personal Information Services. AR 330-63. This document, or a substantially similar
version, was available on FMWRC’s webpage as early as February 4, 2010, but it was not
referenced in the solicitation or directly disseminated to offerors in the procurement process. See
id.; Def.’s Notice of Compliance ¶¶ 1-2, Nov. 21, 2011; Evard Decl. (“Third Evard Decl.”)
¶ 5(1), Nov. 18, 2011 (Ex. A to Plaintiff’s Resp. to Nov. 15, 2011 Order); Guertin Decl. ¶ 4,




                                                5
Nov. 21, 2011 (Ex. A to Intervenor’s Resp. to Nov. 15, 2011 Order). Nonetheless, Defendant
included these Instructions, some 34 pages, in the AR. AR 330-63.

        The purpose of the Implementing Instructions was to outline the procedures to
successfully deploy the AAFES/FMWRC partnership and identify the role, oversight, and
management responsibilities of AAFES to deliver Personal Information Services to service
members. AR 331. Under a heading titled “Staff Planning,” the Implementing Instructions
stated, “FMWRC will appoint a FMWRC Telecommunications Operations Manager as the
primary FMWRC Coordinator of the [Personal Information Services] partnership . . . .” AR 337.
The Instructions also stated, “FMWRC will assign one . . . Contracting Officer and one . . .
Business Manager, under operational control of the [AAFES Vice President] . . . .” Id. The
Implementing Instructions further specified that the business manager would be a voting member
of the Source Selection Committee panels, participate in the development of new business
requirements, and have a role in developing contracting methodology. AR 351-52.

        The Implementing Instructions also defined the role of the contracting officer, who was
to develop and assist with Personal Information Services contract implementation and execution,
and lead in the development and fulfillment of acquisition plans, contract requirements,
solicitation development, contract negotiations, and award. AR 353-54.

The Request for Information

        On February 11, 2010, AAFES issued a Request for Information (“RFI”) to prospective
contractors to provide for-fee consumer telecommunication services at various military
installations. AR 8. The RFI notified vendors that “ARMP [would be] able to provide AAFES
selected suppliers” network support, but that “[a]ny agreements with ARMP [would] be
independent of contracts with AAFES.” AR 29. The RFI stated that after a solicitation was
issued, ARMP would host an industry information day where attendees would gain an
understanding of “ARMP provided services” and participate in an open forum to exchange
information. Id.

The Draft Solicitation

       On April 12, 2010, AAFES issued a draft solicitation for the for-fee ISP procurement.
AR 118. The draft solicitation offered ARMP as a ‘“turnkey network’ and maintenance provider
for those locations where ARMP [had] installed infrastructure” and stated that “[i]f providers
choose to use ARMP, then ARMP shall assume the role of a sub-contractor to the prospective
ISP.” AR 119-20. The draft solicitation listed advantages of using the ARMP network solution
that were substantially reiterated in the final solicitation. AR 120-21, 367. The draft solicitation
also announced Industry Day, characterizing it as a “Site Survey” and an important event for
prospective offerors. AR 118; see AR 126.

Industry Day

      On April 28, 2010, AAFES and ARMP held Industry Day at Fort Carson, Colorado. AR
277. Representatives from CCS including Mr. Tim Evard, CCS’ Executive Vice President,



                                                 6
attended Industry Day. AR 328-29, 2108. The Industry Day presentation, also referred to as a
pre-proposal conference, included an introduction to the “Key Procurement/Operations Team,”
and an overview of ARMP’s services. AR 275-76, 279, 281-82; see AR 290. The record
contains the 68 slides used in the Industry Day presentation. AR 256-323.

       As part of the Industry Day presentation, AAFES’ Chief for New Business and another
AAFES employee showed attendees a slide identifying the “Key Procurement/Operations Team”
as Cynthia Williams (Contracting Officer, AAFES), Nathanial Wills (Army Contracting
Specialist, FMWRC), Mike Kaucher (Chief for New Business, AAFES,) John Temple (Army
Business Manager, FMWRC), David LaPradd (Telecommunications Operations Manager,
FMWRC), and William Hart (General Manager, ARMP). AR 126, 279.

        Industry Day attendees were informed that ARMP was an “operational element of
[FMWRC]” that was “[c]reated to develop revenue to fund Morale, Welfare & Recreation
programs Army wide.” AR 274. A slide listing frequently asked questions stated that bidders
could partner with ARMP, and that ARMP would provide “installation site review coordination
and service deployment.” AR 321. Another slide informed offerors that ARMP could provide a
variety of services: “Internet Gateway & LAN Services; Internet Access Device leasing,
management, and support; Service Leasing; Hardware Support; Security Services and Support;
Systems Maintenance, Troubleshooting, and Support; Onsite Technical Service; Recreational
Machine leasing, and Support; [and] Remote Technical Support.” AR 275. An additional slide
indicated that ARMP “operated” in the Continental United States at “[m]ost major garrisons”
with “[p]lans to reach all garrisons in coming years.” AR 276.

       A slide titled “Key Telecommunications Agreements/Policies” identified the February
2009 Memorandum of Understanding, the December 2009 Memorandum of Agreement and an
April 2010 Army policy letter that provided guidance regarding the transition of the Army’s for-
fee Personal Information Services to AAFES. AR 282; see AR 362-63. These three documents
were available on FMWRC’s website. Def.’s Notice of Compliance ¶ 2. The Industry Day slide
presentation did not reference the Implementing Instructions. See AR 256-323. 3

The Solicitation

        On May 12, 2010, AAFES issued solicitation number RFP ATI-09-010-10-014. AR 364-
    4
463. The purpose of the solicitation was to obtain “pre-paid,” “for-fee” internet services, with
an option for voice, video, and “post-paid” internet, at 79 Army and Air Force installations in
five geographic locations in the United States. AR 376, 410-417. The solicitation contemplated
a five-year base period, with five one-year option periods. AR 376. Provision of services at
other military bases within a geographic group was optional. Id. The solicitation further notified



        3
         On April 30, 2010, the contracting officer emailed Industry Day attendees a copy of the
“presentations briefed at Industry Day.” AR 10468-69.
        4
       The solicitation was largely the same as the draft solicitation issued the prior month.
Compare AR 119-231 with AR 366-463.


                                                7
offerors that service requirements could be expanded to military bases not listed in the
solicitation. AR 376, 378.

       The solicitation expressly addressed ARMP’s role as a potential subcontractor. The
Executive Summary stated:

      e. ARMP as a Potential Internet Sub-Contractor

      1) ARMP has offered a “turnkey” network and maintenance provider agreement
      for those Installations where ARMP infrastructure exists or is planned. At those
      Installations, commercial ISPs will have an option of leasing the ARMP network
      and equipment at a negotiated price, or [of providing] the necessary network and
      equipment separately. If providers choose to utilize the ARMP network, then
      ARMP shall assume the role of sub-contractor to the prospective ISP. The ISP’s
      agreement with ARMP will be a separate contract from the contract with AAFES.

AR 366-67 (emphasis omitted). Under the same paragraph, the solicitation listed “[s]ome
advantages of using the ARMP network and equipment:”

      i.     The existing bandwidth, infrastructure and network components are
             already in place which may prevent any break in current service and will
             facilitate faster speed to market.

      ii.    Turnkey operation for the new provider.

      iii.   Maintenance, support, and installation of new equipment and upgrades as
             necessary . . . .

      iv.    Ability to continue to support customers without a break in service during
             the transition period from ARMP to the competitively selected AAFES
             ISP.

      v.     Efficiency and economy which ARMP currently utilizes with [its]
             installed infrastructure to support FMWRC mission related services.

                                                 ***

      vi.    ARMP has the capability to coordinate between the Installation
             Management Command (INCOM) proponent activities on Army
             Garrisons and the AAFES ISP to ensure proper implementation and has
             the flexibility to adjust network configurations to accommodate growth
             and mission changes.

      vii.   ARMP provides Internet network access to a commercial carrier and
             bandwidth provisioned to selected Installations through access points




                                             8
        After each voting member of the Source Selection Committee scored the proposals, the
Committee would meet for discussion, with the goal of coming to a consensus on the evaluations
and preparing a written report to summarize the results and rank the proposals. AR 7935, 7942-
43. The report was to discuss the basis for the Source Selection Committee’s ranking in
sufficient detail to support the Committee’s recommendation. AR 7935, 7943. Exchange
Operating Procedure 65-13 provided that the Source Selection Committee report would
“summarize[] the strengths, weaknesses, and risks of each proposal.” AR 7935. All original
individual scoring sheets were required to be attached to the report. AR 7943.

        In addition to a technical evaluation, the solicitation stated that AAFES would review the
offerors’ fee proposals for the projected financial benefit to AAFES, and explained that “[a]s the
technical rankings [became] closer, the Fees to AAFES [would] become more important.” AR
453, 455. Under the solicitation, the fees for internet, voice, and video services were to be
weighted as follows:

           a. Initial Contract Ordering Period Fees          - will be multiplied by 2
           b. Contract Option Periods 1-5 Fees               - will be multiplied by 1

AR 455. For purposes of evaluation, the voice and video services fees would not be combined
with internet service fees. Id. The purpose behind these weights was “to ensure that AAFES . . .
received a balanced proposal and obtained a reasonable fee proposal for ‘firm’ periods (years 1-
5) versus the uncertain Contract Option Periods.” AR 1512 (emphasis in original). Each offeror
was to submit a single fee percentage for each military installation and each service being
proposed within a geographic group, accounting for every installation within the geographic
location being proposed. AR 458. As part of these fee proposals, offerors were required to
provide pro forma Operating Statements, containing projections for internet service in each
geographic group being proposed. Id.

        Offerors were also required to submit past performance references. AR 456, 458. The
solicitation required each offeror to “provide descriptions of three (3) to five (5) operations in
use during the past five (5) years of similar type and size of the project, as described within this
solicitation.” AR 458.

         On June 14, 2010, AAFES amended the solicitation by, inter alia, adding an internet
services pro forma Operating Statement form and delineating the type of information to be
included in that Statement. AR 882, 908 (Tab 12). Offerors were required to provide financial
information in eight categories: investment outlays, sales, gross operating income, operating
expenses, total operating expenses, operating earnings before interest and taxes, pre-tax income,
and net income. AR 908 (Tab 12). The pro forma Operating Statements were to cover only the
first five-year contract period, even though offerors were required to provide fee data for a 10-
year period, and were to be evaluated based on a 10-year period. Id.; see AR 407. The
Amendment also extended the due date for the submission of proposals until June 23, 2010. AR
882 (Tab 12).




                                                10
CCS’ Pre-Proposal Communications with AAFES

         In March 2010, CCS emailed AAFES objecting to build-out activities at Fort Bliss, a
location where CCS was providing services under its bridge contract, claiming ARMP’s
activities violated 10 U.S.C. § 2492a. AR 2515-16; see AR 279, 1887. This statute prohibited
DoD entities from offering or providing Personal Information Services to consumers using DoD
resources, personnel, or equipment or competing to provide Personal Information Services for a
fee. CCS stated:

       [W]e are becoming increasingly concerned that ARMP has every intention of not
       only staying in the WIFI business, but monopolizing it per their previous effort, in
       what appears to be blatant disregard of [C]ongress’ wishes.

       We had previously informed you that we would take Fort Bliss and give
       consideration to the ARMP “services” where [it] had deployed infrastructure. We
       presumed, based on our conversations, that [ARMP] would not continue to invest
       tax dollars in adding infrastructure since we are willing to provide the internet
       services[.]

       However, [ARMP] continue[s] to add or attempt to add to [its] network . . .
       despite our stated willingness and ability to provide service.

Id.

       AAFES replied:

       We are not privy to all of [ARMP’s] plans and negotiations between you as it
       relates to the optional infrastructure use. However, we are aware and do
       understand ARMP has a command commitment to complete build-out work at
       Bliss--and other locations--and that you both were in discussions on how that
       could be accomplished at Bliss.

       The legislative guidance is clear on how [Personal Information] services will be
       provided and FMWRC has made a commitment to that.

AR 2515. In a response sent to both AAFES and FMWRC, CCS stated: “All due respect to
ARMP and [its] ‘commitments.’ The Congress and the Law is clear. What part of this is not
understandable? Congress . . . has said stop doing this and it is continuing.” AR 2514; see AR
107, 279, 8150.

       In May 2010, CCS submitted questions to the contracting officer regarding ARMP’s
planned role in the procurement. AR 2943. CCS stated:

       [ARMP’s] role is a little confusing and the scope of [its] support is not clear. Will
       [it] only be able to provide support services where [it has] deployed [Personal
       Information Services] already? Will [it] be able to provide those services where [it



                                                11
       deploys FMWRC Information Services] going forward (over [its FMWRC
       Information Services] network)? Is there any certainty around where and on what
       time schedule [it] will be able to provide services going forward? If [ARMP’s]
       business model is to receive a percentage of revenue, in exchange for providing
       infrastructure and capital investment, [is ARMP] in a position to deploy “risk”
       capital for the winning bidder(s)?

Id. The contracting officer responded:

       a) ARMP is not limited to deploy [Personal Information Services] to provide
       support. The deployment of ARMP’s official service support network [FMWRC
       Information Services] is independent from the for fee services that AAFES will
       offer.

       b) ARMP would need to confirm [its] capability outside the Army sphere and
       [FMWRC Information Systems] network. As the [FMWRC Information
       Services] network expands, the capability to support providers will also expand;
       although, separate agreements and [service-level agreements] are required with
       ARMP to consider future expansion.

       c) This will be handled on a case by case basis directly with ARMP and included
       in the [service-level agreement]. It is [AAFES’] understanding that ARMP will
       work collaboratively with the vendors.

       d) This will be handled on a case by case basis directly negotiated with ARMP.
       Under the ARMP proposal, [its] risk is the same as the vendor[’s], since the
       reimbursement to ARMP is based upon revenue and there is a fixed cost for
       ARMP to install and maintain the network.

Id.

Offerors’ Knowledge of the Implementing Instructions

        On February 4, 2010, Resolute’s Vice President of Marketing, Paul Guertin, found the
Personal Information Services Implementing Instructions “during [a] web-based search,” and
forwarded them to other Resolute executives. Guertin Decl. ¶¶ 3, 4. The Implementing
Instructions focused on the newly formed partnership between AAFES and FMWRC and its
effort to create an integrated strategy to manage Personal Information Services. Id. at Ex. B
(Version 3.6, Jan. 21, 2010 Implementing Instructions); see also AR 333-34 (Version 3.9, May
10, 2010 Implementing Instructions). The annexes to the Jan. 21, 2010 Implementing
Instructions Mr. Guertin located online included: (1) the 2009 February MOU between AAFES
and FMWRC on Personal Information Services, (2) an explanation of the roles and
responsibilities of FMWRC-appointed telecommunications operations manager and FMWRC-
assigned business manager and contracting officer, and (3) a sample statement of work for
Personal Information Services. Guertin Decl. 21-32. The annexes to the May 10, 2010 version
of the Implementing Instructions also included the 2009 December MOA between FMWRC and



                                             12
AAFES and the April 6, 2010 memorandum from the Army’s Assistant Chief of Staff for
Installation Management to all Army bases regarding Personal Information Services. AR 358-
63. On March 3, 2010, Mr. Guertin again accessed the Implementing Instructions and forwarded
them to two Resolute executives. Guertin Decl. ¶ 5.

       Mr. Evard, Executive Vice President of CCS, testified in a declaration that CCS did not
obtain the Implementing Instructions prior to June 18, 2010, and that he personally became
aware of the Implementing Instructions on October 14, 2010, after proposals were submitted,
“while performing research on a matter unrelated to this litigation.” Third Evard Decl. ¶¶ 5(1),
(3). Mr. Evard “did not review the document in detail, and did not review the Annexes at all,
until mid-December when [CCS was] preparing the Complaint in this action.” Id.

The Proposals

        AAFES received six proposals. AR 1501. 5 CCS proposed to use ARMP for some of its
existing infrastructure needs, stating it had “plans and the necessary partnerships, including
ARMP, in place to roll services out to all locations by June 30, 2011.” AR 713 (Tab 13)
(emphasis omitted). The proposal indicated that CCS would self-deploy many of the networks
and infrastructure but that ARMP would be a “deployment partner” at 18 mandatory bases. AR
830-834 (Tab 13). In its proposal, CCS stated it chose to limit ARMP’s role because of concerns
over the availability of ARMP’s infrastructure. AR 804 (Tab 13).

       CCS proposed a [ * * * ] AAFES commission for internet services at four of the five
geographic locations -- except for the Alaska region. AR 843-49 (Tab 13). According to CCS’
pro forma Operating Statements, CCS projected [ * * * * * ] in combined internet sales from the
Western, Hawaii, Central, and Eastern regions, giving AAFES an estimated commission of [ * *
* * * * ] for the five-year period. AR 857 (Tab 13); see AR 858-63 (Tab 13). CCS’ pro forma
Operating Statements did not provide its estimated penetration rate, i.e., the estimated percentage
of the base population that would pay for hourly, daily, weekly, and monthly internet service
plans. AR 857 (Tab 13); see AR 858-63 (Tab 13).

        Resolute also submitted a timely proposal for all geographic regions. See AR 464-709
(Tab 14). Resolute divided the mandatory military bases into three groups: Group A -- locations
with an existing and operational ARMP network without a service provider, Group B -- locations
with an existing but nonoperational ARMP infrastructure without a service provider, and Group
C -- locations with an existing provider with contracts expiring in 2011. AR 535-42 (Tab 14).
For Group A locations, Resolute proposed partnering with ARMP to transition existing services
to Resolute. AR 535 (Tab 14). At Group B locations, Resolute planned to partner with ARMP
to make services operational on ARMP’s existing infrastructure. AR 538 (Tab 14). For Group C
locations, Resolute would partner with ARMP when available. AR 540-42 (Tab 14). Resolute
did not expressly reference a “subcontract” with ARMP, but called its relationship with ARMP a




       5
         The record only contains the proposals of Resolute, CCS, and NetNearU. AR 464-881
(Tabs 13-14), 909-1010 (Tab 15).


                                                13
partnership and referred to ARMP as its “preferred vendor.” AR 466-67, 535, 538, 540, 619,
662, 664 (Tab 14).

        Regarding fees, Resolute assumed an average monthly penetration rate of [ * * * * ] in
2011 on fully built-out mandatory bases, but applied a [ * ] discount to its estimated penetration
rates to account for competition from existing franchises (in locations with provider contracts
expiring in 2011). AR 686-87 (Tab 14); see AR 540-42 (Tab 14). Resolute’s pro forma
Operating Statements reflected [ * * * * * ] commission [ * * * * ] for AAFES, an [ * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * ]. AR 687 (Tab 14). Resolute projected
internet sales of [ * * * * * * ] for all geographic regions [ * * * * * * * * * * * ]. AR 688 (Tab
14). This translated into commissions [ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * ]. AR 688-89 (Tab 14); see AR 687 (Tab 14).

The Technical Evaluation

        The Source Selection Committee was comprised of five voting individuals, and each
member used individual score sheets when conducting the technical evaluations. AR 1248-1499,
1519; see 7935, 7141. While all voting members of the Committee provided comments
justifying their scores, not all used the prescribed comment codes -- significant strength, strength,
significant weakness, weakness, clarification, and risk. AR 1248-1499. For example, when
scoring CCS for past performance, one evaluator wrote: “10+ years in internet business, worked
[with] [ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ], has
experience working on a military base.” AR 1271. Individual evaluation scores were then
modified based on the Source Selection Committee’s consensus discussion. AR 1248-1499.
These modifications were made either directly on score sheets, or were reflected as differences
between the numerical scores listed on individual score sheets and the final Source Selection
Committee Spreadsheet reflecting the consensus numbers. See, e.g., AR 1270-73 (an evaluation
team member’s score sheets for CCS, noting changes in factor scores made after the discussion);
AR 1328-33 (an evaluation team member’s score sheets for CCS highlighting several large point
increases from the original scores).

        Below is a summary of the changes between the initial individual scores and the Source
Selection Committee consensus scores for CCS’ and Resolute’s proposals for internet services:

                     Individual Source Selection Committee Member Scores for CCS

                          Individual Scores Pre Consensus Meeting   Individual Scores Post Consensus Meeting
 Evaluation Factor
                          JT      DL      AM      MK       MV       JT      DL       AM      MK       MV
                          [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
 Products
                          [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
 Portability
                          [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
 Marketing
                          [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
 Technical Design
                          [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
 Scalability
                          [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
 Standards




                                                      14
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Speed to Market
 Customer Account
 Service                   [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]


 Customer Care and
 Customer Satisfaction     [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]

                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Past Performance
 Business
 Understanding and
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Reporting

AR 1228, 1248-53, 1268-73, 1290-95, 1308-13, 1328-33.

                Individual Source Selection Committee Member Scores for Resolute

                           Individual Scores Pre Consensus Meeting                     Individual Scores Post Consensus Meeting
 Evaluation Factor
                           JT         DL         AM        MK          MV              JT           DL        AM        MK       MV
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Products
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Portability
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Marketing
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Technical Design
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Scalability
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Standards
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Speed to Market
 Customer Account
 Service                   [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]


 Customer Care and
 Customer Satisfaction     [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]

                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Past Performance
 Business
 Understanding and
                           [***]      [***]      [***]     [***]       [***]           [***]        [***]     [***]     [***]    [***]
 Reporting

AR 1230, 1349-54, 1369-74, 1389-94, 1407-12, 1427-32.

         The individual scores were then weighted for each evaluation factor as follows:

               CCS’ Weighted Scores for Internet                               Resolute’s Weighted Scores for Internet
Evaluation
Factor         JT        DL        AM         MK      MV       Avg             JT           DL        AM        MK       MV       Avg
Products       [***]     [***]     [***]      [***]   [***]    [***]           [***]        [***]     [***]     [***]    [***]    [***]
(15%)
Portability    [***]     [***]     [***]      [***]   [***]    [***]           [***]        [***]     [***]     [***]    [***]    [***]
(10%)
Marketing      [***]     [***]     [***]      [***]   [***]    [***]           [***]        [***]     [***]     [***]    [***]    [***]
(5%)
Technical      [***]     [***]     [***]      [***]   [***]    [***]           [***]        [***]     [***]     [***]    [***]    [***]
Design (15%)



                                                              15
Scalability     [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
(10%)
Standards       [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
(10%)
Speed to        [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
Market (10%)
Customer
Account         [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
Service (5%)
Customer
Care and
Customer
Satisfaction    [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
(5%)
Past
Performance     [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
(10%)
Business
Understanding
and Reporting   [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
(5%)
                [***]   [***]     [***]   [***]   [***]   [***]      [***]    [***]     [***]     [***]   [***]   [***]
TOTAL:


AR 1228, 1230.

        The Source Selection Committee Report ranked each offeror based on its raw score for
internet services. AR 1525 (Table 2). Resolute ranked first in all factors except portability, a
factor of moderate importance, where it ranked second. AR 1520, 1526. CCS ranked [ * * * * *
****************************************************
****************************************************
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ]. AR 1521, 1526.
The following chart compares the scores of Resolute and CCS for each factor:

                    Evaluation Factor                             Resolute Score      CCS Score

                                                                      [***]             [***]
                    Products
                                                                      [***]             [***]
                    Portability
                                                                      [***]             [***]
                    Marketing
                                                                      [***]             [***]
                    Technical Design
                                                                      [***]             [***]
                    Scalability
                                                                      [***]             [***]
                    Standards
                                                                      [***]             [***]
                    Speed to Market
                    Customer Account Service                          [***]             [***]


                    Customer Care and Customer Satisfaction           [***]             [***]

                                                                      [***]             [***]
                    Past Performance
                                                                      [***]             [***]
                    Business Understanding and Reporting

AR 1526.




                                                          16
       The Source Selection Committee also ranked the proposals in terms of total average
weighted scores for internet. AR 1525. Resolute’s total average weighted score was [ * * ]. Id.
CCS’ total average weighted score was [ * * * ]. Id. Overall, Resolute ranked first for internet
services and CCS ranked [ * * ]. Id. Regarding Resolute, the Source Selection Committee
Report stated:

       With the exception of the corporate financial position, this is clearly the best
       proposal.

       . . . Resolute has strong, flexible product options with ample bandwidth and value
       enhancements to offer customers. Network design and options for providing
       service are robust, leveraging [its] extensive experience with AAFES. Resolute
       consistently presented superior solutions to all factors requested within the RFP.

AR 1520-21. The Source Selection Committee Report noted that CCS’ proposal “scored well”
and was “found to be a very viable solution.” AR 1521. The Report noted that “[CCS was]
financially strong, provide[d] a strong product offering, [had] substantial experience,” and
provided “aggressive monitoring of [the] network.” Id.

        The Source Selection Committee Report listed strengths and weaknesses for each offeror
compiled from the evaluators’ individual comments. AR 1533-1540. For Resolute, the overall
strengths were:

       •   [************************************]

       •   [****************]

       •   [*****************************************
           **********************]

       •   [*******************************]

       •   [*********************************]

       •   [********************]

       •   [*************************************]

       •   [*****************************************
           *******************]

       •   [*****************************************
           ****]

       •   [ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ** * * * * * * *
           ************************************]


                                                17
       •   [********************]

       •   [ * * * * * * * * * * * * * ].

AR 1533-34. For Resolute, the overall weaknesses were:

       •   [****************]

       •   [****************************]

       •   [ * * * * * * * * * * * * * * * * * * * * * * * * * ].

AR 1533.

       For CCS, the overall strengths were:

       •   [*********************************]

       •   [*********************************************
           ****]

       •   [*********************************************
           *****]

       •   [****************]

       •   [**************************]

       •   [*************************]

       •   [******************************]

       •   [*********************************************
           *********************]

       •   [**********************]

       •   [*************************]

       •   [* * * * * * * * * * * * * * * * * * * * * * ]

       •   [*********************************************
           *******]




                                                  18
          •   [*********************************************
              ********]

          •   [**********************]

          •   [ * * * * * * * * * * * * ].

AR 1535-36. For CCS, the overall weaknesses were:

          •   [*********************************************
              *********]

          •   [ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ].

Id.

The Fee Evaluation

       CCS and Resolute proposed the following prices and fee commissions for internet
services:

                                               CCS’ Fee Proposal 6

  Group       Price for Type of Internet Service

                                                                        Pre-paid monthly
              Pre-paid hourly      Pre-paid daily    Pre-paid weekly    (optional)
              [***]                [***]             [***]              [***]
  Alaska
              [***]                [***]             [***]              [***]
  Eastern
              [***]                [***]             [***]              [***]
  Central
              [***]                [***]             [***]              [***]
  Western
              [***]                [***]             [***]              [***]
  Hawaii

AR 714 (Tab 13).
                                            Resolute’s Fee Proposal 7
  Group       Price for Type of Internet Service

              Pre-paid hourly      Pre-paid daily    Pre-paid weekly    Pre-paid monthly
              [***]                [***]             [***]              [***]
  Alaska
              [***]                [***]             [***]              [***]
  Eastern
              [***]                [***]             [***]              [***]
  Central



              6
          •       CCS proposed a [ * * * ] fee to AAFES for four regions. AR 843-49 (Tab 13).
              7
          •       Resolute proposed an [ * * * ] fee to AAFES for all regions. AR 687.

                                                       19
            [***]            [***]            [***]             [***]
  Western
            [***]            [***]            [***]             [***]
  Hawaii

AR 583 (Tab 14). [ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ]. AR 687, 709.1 (Tab 14).

       The contracting officer, with assistance from AAFES financial technical expert, Otis
Wright, prepared the Fee Evaluation Report. AR 1512; see 107, 1500. The projected benefit
from CCS’ and Resolute’s price proposals was calculated using the following equation:

       Base Population x Price x Fee x Penetration Rate = Projected Income to AAFES

AR 1512. While this equation was not shared with offerors, the solicitation included the base
population for each mandatory military base. AR 410-16; see First Jackson Decl. ¶ 97. The total
base population for all groups except Alaska was 365,822. AR 410-16. Including Alaska, the
total base population was 390,274. Id.

        The penetration rate represented the estimated percentage of the base population that
would pay for hourly, daily, weekly, and monthly internet service plans. AR 5876, 5879.
AAFES’ independent consultant, Deloitte LLP, calculated standard penetration rates for these
services based on FMWRC’s historical usage rates in the Continental United States. Id. The
rates used were 1.8% for pre-paid hourly service, 1.1% for pre-paid daily service, 0.8% for pre-
paid weekly service, and 2.9% for pre-paid monthly service. AR 5879. AAFES’ stated purpose
in using these penetration rates was to create a “level playing field,” as these rates were
uniformly applied to all proposals. AR 5880.

       For contract years one through five, CCS and Resolute were evaluated as follows:

                Resolute:     [ * * * * * * * ] estimated total income to AAFES
                              (or [ * * * * * * * * ] per year)

                CCS:          [ * * * * * * * ] estimated total income to AAFES
                              (or [ * * * * * * * * ] per year)

AR 1517. With Alaska factored out to create an even comparison, Resolute would have
provided to AAFES an estimated [ * * * * * * * * ] for contract years one through five, or
[ * * * * * * ] annually. Id.

        Overall, the contracting officer found that Resolute offered the “[m]ost attractive Internet
fee proposal for all regions.” AR 1514. Resolute provided the highest fee percentage per region
for all contract years, as well as the highest projected income to AAFES per region for the full
10-year period. Id. CCS’ fee proposal was ranked [ * * * * * * * * * ] for all regions excluding
Alaska. Id. Assuming performance for the entire 10-year period and weighting the first five
years twice as heavily as the last five, the contracting officer determined that CCS would provide
[ * * * * * * * ] in fees to AAFES, whereas Resolute would provide [ * * * * * * ] in fees to
AAFES factoring out Alaska. AR 1513.


                                                20
The Source Selection Decision

        On October 7, 2010, the Source Selection Authority made the source selection decision,
based on his assessment of the Source Selection Committee Report, the contracting officer’s fee
analysis, the contracting officer’s recommendation, the solicitation evaluation factors, and a
comparative analysis of the proposals’ strengths and weaknesses. AR 1550-55. The Source
Selection Authority determined that Resolute offered the “best overall value for AAFES across
all regions . . . .” AR 1555. The award determination was contingent upon the contracting
officer’s pending responsibility determination. AR 1555. The Source Selection Authority
acknowledged a concern over Resolute’s indebtedness to AAFES, but noted that Resolute was
making monthly payments to cure deficiencies. AR 1552. As of February 17, 2010, Resolute
owed AAFES [ * * * * * * ] in outstanding fee payments and late charges for sales from October
to December 2009. AR 10529. The source selection decision contained no further information
regarding the debt, but the debt was discussed in Resolute’s responsibility determination. AR
1755, 1757-58.

The Financial Analysis of CCS and Resolute

        AAFES conducted a financial evaluation of the offerors in late June 2010. AR Index 2.
Mr. Otis Wright, the Source Selection Committee’s financial technical expert, conducted the
analysis. 8 AR 1754-56; see AR 1500, 1512, 8469-89. Mr. Wright prepared CCS’ evaluation
using “unaudited statements,” because CCS only provided AAFES with the financial information
[***************************************************
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ]. Id. Mr.
Wright noted however that [ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
****************************************************
* * * * * * * * * * * * * * * * * ]. Id.

        Mr. Wright evaluated Resolute to be [ * * * * * * * * * * * * * * * * * * * * * * * * * * ].
AR 1015. He noted that as of April 2010, a cash flow analysis [ * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ]. AR 1015-16. Mr.
Wright raised a concern about Resolute’s continued viability and its ability to “manage its
operating activities through its current financial challenges.” AR 1015. Yet, Mr. Wright
observed that Resolute had a “[ * * * * * * * ] for continued support from its banking partners.”
Id.
        As part of the responsibility evaluation, the contracting officer submitted a Request for
Vendor Financial Data/Clearance to initiate financial reviews of Resolute and CCS. AR 5497-
500, 8504-05. Based on the results, Resolute was cleared for [ * * * * ] annually and CCS, for
[ * * * * * * ] annually, not the full $44.8 million contract amount. AR 8504-05, 5499-500.


       8
         Mr. Wright is described as a financial technical expert and an advisor to the Source
Selection Committee. AR 1500, 1519, 1754; Def.’s Mot. J. AR 15, 53, Aug. 8, 2011;
Intervenor’s Statement of Facts 25, Aug. 8, 2011; Def.’s Supp. Br. 10-11, Apr. 16, 2012. Mr.
Wright holds the title of Financial Analyst III in the office of AAFES Advanced
Telecommunications Initiatives. AR 8489.


                                                21
        In performing the responsibility determination, the contracting officer confirmed that as
of August 2010, Resolute maintained an account with [ * * * * * * ] with an average balance of
[ * * * * * * * * * * * * ] and that the bank considered Resolute’s rating [ * * * * * * * ]. AR
8535. The contracting officer also confirmed that Resolute maintained an account with Bank of
America with an average balance of [ * * * * * * * * ]. AR 8536.

        During the responsibility determination, which was performed from May to early
November 2010, AAFES was aware that Resolute would owe [ * * * * * * * * * * * * * * * * * *
* * * * * * * * * * ] as of June 2010 under a long-term [ * * * * ] debt obligation. AR 1015,
1755. The contracting officer received a letter dated August 11, 2010, from [ * * * * * ]
clarifying the status of this loan:

       This letter is in response to Resolute Partners, LLC’s . . . request . . . [ * * * * * *
       * * ] for its reply to you regarding the [[ * * * * ] loan] status. [Resolute] [ * * * *
       *******************************************]
       and became effective March 2, 2010 which expired August 1, 2010. The
       restructure of the company’s debt is subject to the results of the various contracts
       including the RFP currently under your review.

                                                ***

       It is [ * * * * * * ] intent to support these initiatives and those to come as the
       relationship between AAFES and Resolute Partners continues to flourish.

AR 8539.

       In mid-September, as part of the ongoing financial analysis, the contracting officer
contacted [ * * * * * * ] to gain additional information regarding the status of the debt and
Resolute’s financial future with [ * * * * * ]. AR 8540-41. The bank responded:

       Resolute is already stable and is performing per its agreed loan terms with [ * * *
       * * * ]. A long-term structure will be finalized in a maximum of 60 days, subject
       to the final details received on its various existing contracts and several other
       outstanding RFP awards that are anticipated very soon. Resolute’s loan balances
       are in [ * * * * * * * * * * * ] . . . .

                                                ***

       [ * * * * * ] will continue to support Resolute and feels very comfortable with
       Resolute’s ability to perform on their various contracts. In fact, their performance
       will only be enhanced with the awarding of this RFP.

AR 8540 (emphasis omitted).

       Mr. Wright recommended that AAFES proceed with an award to Resolute based on
several factors. AR 1220. First, he found Resolute would see an increase in sales due to the



                                                 22
award of the contract. Id. He noted that in 2009, Resolute had [ * * * * * ] in sales, considering
the sales from Resolute’s current locations and projected sales from locations in Resolute’s offer.
AR 1220, 1223. He estimated sales for each year of the initial five-year contract period as
[ * * * * * * ] for 2011, [ * * * * * * ] for 2012, [ * * * * * * ] for 2013, [ * * * * * * ] for 2014,
and [ * * * * * * ] for 2015. AR 1223. Mr. Wright’s forecast indicated that once Resolute began
full operation under the contract, its net income would increase by [ * * * ] between 2011 and
2012, and estimated that Resolute could be debt free by 2014. AR 1220.

       Second, Mr. Wright remarked that AAFES’ fee commission payments could be booked
as “Cost of Sales,” such that the payment would be paid against revenue before other operating
expenses were paid. Id.

        Third, Mr. Wright considered Resolute’s “Book Value,” and calculated that an award to
Resolute would improve its net present value from [ * * * * * * ] in 2010, to [ * * * * * * ]
through 2015, because of its ability to generate sales and net income. AR 1221. Mr. Wright
found that the rate of return from Resolute’s operation under the contract would exceed its cost
of capital, thereby increasing its net present value, and that Resolute’s strengthened financial
position would attract additional capital. Id.

       Fourth, Mr. Wright considered that Resolute would “need [ * * * * * * * ] over the first
two years of the contract period for continuing operations and contract execution,” and that it
was likely that [ * * * * * * ] would “provide as much funding as needed to execute the contract
requirements,” given the bank’s vested interest in Resolute’s continued success. AR 1221-22.
Mr. Wright noted that Resolute had previously raised [ * * * * * * ] and estimated that by 2014,
funds internally generated would be [ * * * * * ], exceeding the projected funding needs. AR
1222.

The Responsibility Determination

        On November 8, 2010, the contracting officer completed her Determination of
Responsibility. AR 1753-59. The Federal Acquisition Regulation (“FAR”) does not apply to
AAFES. AR 381. According to governing AAFES policy, Exchange Service Purchasing
Policies (ESR Policy) 65-1, a responsible prospective contractor must meet seven minimum
standards. AR 8020 (ESR Policy 65-1 ¶ 4-46(c)). At issue in this case are two standards -- that
a prospective contractor must (1) have adequate financial resources, or the ability to obtain such
resources, as required during performance, and (2) have a record of satisfactory performance “or
be able to document beyond reasonable doubt that any prior problems that created a marginal or
unsatisfactory situation have been eliminated.” Id. 9




       9
          These AAFES standards are similar to FAR requirements. The first standard parallels
FAR 9.104-1(a) (requiring that the offeror “[h]ave adequate financial resources to perform the
contract, or the ability to obtain them”) and the second is similar to 9.104-1(c) (requiring that the
offeror “[h]ave a satisfactory performance record”).


                                                  23
Financial Resources

       In analyzing the adequacy of Resolute’s financial resources, “or [the] ability to obtain
such resources, as required during performance of the contract,” the contracting officer noted in
her Determination of Responsibility:

       1.      A clear history;
       2.      Secured financing;
       3.      No serious red flags of financial risk of non-payment; and
       4.      [Dun & Bradstreet] payment performance history:
               a. 12-Month [Dun & Bradstreet] PAYDEX Score averages 70 which
                  mean payment to suppliers average 15 days beyond terms;
               b. [3-Month Dun & Bradstreet] PAYDEX Score averages 76 which mean
                  payments to suppliers average 6 days beyond terms; and
               c. A credit appraisal rating of [“3=Fair.”] These ratings indicate timely
                  payments that average 15 days beyond terms.

AR 1754-55.

        With respect to bank references, the contracting officer found that Resolute’s overall
bank and credit rating were considered satisfactory. AR 1755. [ * * * * * * * * * * * * * * * * *
****************************************************
****************************************************
****************************************************
****************************************************
****************************************************
****************************************************
* * * * * * * * * * * * * * * * * * * * * * * * ]. Id.

        With respect to Resolute’s financial projections, the contracting officer, relying on Mr.
Wright’s analysis, determined that Resolute had suffered declining revenues in 2010, but that the
award of this contract would significantly improve Resolute’s financial outlook. AR 1754-56.
The contracting officer accepted Mr. Wright’s Book Value analysis and his finding that the
integration of revenue from the contract award would allow Resolute to achieve a net present
value of [ * * * * * * ] based on projections through the 2015 calendar year. AR 1756.

Past Performance

        As part of Resolute’s responsibility determination, the contracting officer identified two
past performance issues with Resolute’s 2005 contract with AAFES to provide internet café and
other internet access at various locations in Kuwait, Germany, and the Continental United States.
AR 1757. The first was a warning letter from AAFES for a service disruption dated October 16,
2009, at a European military base. AR 1757, 8497-98. The contracting officer stated: “The
issue was resolved in a timely manner by the contractor and service was restored the same day.”
AR 1757. The second issue was “a cure demand,” issued by AAFES on January 13, 2010, for
the nonpayment of $199,740 in fees under the 2005 contract. AR 1757-58. The contracting



                                               24
officer found that Resolute was taking corrective action to cure this debt. AR 1758. AAFES and
Resolute entered into a debt repayment plan for 12 monthly payments of [ * * * ] effective June
1, 2010, so that by the time of the responsibility determination on November 8, 2010, the
outstanding debt had been reduced from $[ * * * ] to $[ * * * ]. Id. In spite of this debt to
AAFES, Resolute’s 2005 contract had been extended for an additional year for all Continental
United States locations, and for three years for all locations outside the Continental United
States. Id. The contracting officer stated, “To date, [Resolute] continues to provide satisfactory
performance and submit payments by the required due date.” Id. Ultimately, on November 8,
2010, the contracting officer determined that Resolute was responsible and the Source Selection
Authority concurred with this determination. AR 1759.

The Notice of Award and Debriefing

         On November 9, 2010, AAFES notified CCS of the award to Resolute, and conducted
CCS’ oral debriefing on December 1, 2010. AR 1760; see AR 1762. During the debriefing,
AAFES indicated that FMWRC had been represented on the Source Selection Committee and
that its “personnel [had] participated with AAFES in developing the requirements for this Best-
Value effort,” and that while ARMP was not represented on the Source Selection Committee,
“ARMP personnel [had] participated with AAFES in developing the requirements for this Best-
Value effort.” AR 1774. AAFES also notified CCS that the pro forma Operating Statements
were used as part of the financial analysis to assist in the technical and fee evaluations. AR
1775.

                                             Discussion

Jurisdiction and Standing

        This Court has jurisdiction over this action pursuant to the Tucker Act, 28 U.S.C.
§ 1491(a) which empowers the Court “to render judgment upon any claim against the United
States founded . . . upon any express or implied contract with the United States. . . .” The Act
continues: “For the purposes of this paragraph, an express or implied contract with the Army
and Air Force Exchange Service . . . shall be considered an express or implied contract with the
United States.” 28 U.S.C. § 1491(a) (2006). “This jurisdictional grant extends to suits brought
by disappointed bidders . . . challenging the proposed award of contracts based on alleged
improprieties in the procurement process.” Cent. Ark. Maint., Inc. v. United States, 68 F.3d
1338, 1341 (Fed. Cir. 1995) (citing CACI, Inc.-Fed. v. United States, 719 F.2d 1567, 1572-73
(Fed. Cir. 1983)). “Jurisdiction in these cases arises from an alleged breach of ‘an implied
contract to have the involved bids fairly and honestly considered.’” Id. (quoting United States v.
John C. Grimberg, Co., 702 F.2d 1362, 1367 (Fed. Cir. 1983) (en banc)). The government
breaches this implied contract if its consideration of offers is found to be arbitrary, capricious, or
otherwise not in accordance with law. Id.

       In 1996, Congress enacted the Administrative Dispute Resolution Act (“ADRA”), which
provides for judicial resolution of all bid protests in a single court, the Court of Federal Claims,
under the standard of review enunciated in the Administrative Procedure Act (“APA”). Pub. L.




                                                 25
No. 104-320, 110 Stat. 3870 (codified as amended at 28 U.S.C. § 1491(b) (2000)). Under these
APA standards, the Court shall:

       (2) hold unlawful and set aside agency action, findings, and conclusions found to
       be—
               (A) arbitrary, capricious, an abuse of discretion, or otherwise not in
               accordance with law;
               (B) contrary to constitutional right, power, privilege, or immunity;
               (C) in excess of statutory jurisdiction, authority, or limitations, or short of
               statutory right;
               (D) without observance of procedure required by law;

                                                   ***

       In making the foregoing determinations, the court shall review the whole record
       or those parts of it cited by a party, and due account shall be taken of the rule of
       prejudicial error.

5 U.S.C. § 706 (2006).

        ADRA grants this Court exclusive jurisdiction over any “action by an interested party
objecting to a solicitation by a Federal agency for bids or proposals for a proposed contract or to
a proposed award or the award of a contract or any alleged violation of statute or regulation in
connection with a procurement or a proposed procurement.” 28 U.S.C. § 1491(b)(1) (2006)
(emphasis added). Because AAFES, the entity that conducted this procurement, is not a federal
agency, jurisdiction is not granted under § 1491(b). However, the Tucker Act bestows
jurisdiction over any claim founded upon any implied-in-fact contract with AAFES; ADRA did
not diminish the jurisdictional grant in § 1491(a). Res. Conservation Grp., LLC v. United States,
597 F.3d 1238, 1245-46 (Fed. Cir. 2010) (holding that implied-in-fact contract jurisdiction under
28 U.S.C. § 1491(a)(1) remains viable for protests where 28 U.S.C. § 1491(b)(1) does not
provide a remedy); see also L-3 Commc’ns Integrated Sys., L.P. v. United States, 94 Fed. Cl.
394, 396-97 (2010); FAS Support Servs., LLC v. United States, 93 Fed. Cl. 687, 694 (2010).

       CCS has standing as a disappointed bidder because it submitted a proposal.

Is a Protest Under § 1491(1)(a) Properly Resolved Under Motions for Judgment on the AR
or Motions for Summary Judgment?

       As a threshold matter, the parties disagree on the procedural mechanism for resolving this
§ 1491(a) protest. Plaintiff filed a motion for summary judgment, while Defendant and
Intervenor filed motions for Judgment on the Administrative Record. 10 CCS points out that no



       10
          Defendant and Intervenor also filed motions to dismiss claiming that CCS lacked the
financial ability to perform the contract and thus lacked standing as an interested party. The
record indicates that CCS has standing. See AR 1521 (Source Selection Committee Report


                                                 26
rule requires that all bid protests, including those brought under 28 U.S.C. § 1491(a), be resolved
on motions for judgment on the AR. Pl.’s Supplemental Br. 3. Defendant and Resolute contend
that the case is appropriately resolved via motions for judgment on the administrative record
because bid protests brought under Section 1491(a) -- while predicated on breach of the implied
duty of fair dealing -- are not a different species of protest than those brought under § 1491(b)
and therefore should not require a different process. The Federal Circuit has not yet addressed
this procedural issue. See Creation Upgrades, Inc. v. United States, 417 F. App’x 957, 959 (Fed.
Cir. 2011) (“Since our decision in Resource Conservation, we have not decided whether bid
protest cases brought under § 1491(a)(1) of the Tucker Act are to be decided on the
administrative record, and we see no need to decide that question in this case.”).

       Plaintiff’s chosen procedure, summary judgment, is a “short cut” to resolving a case by
eliminating the need for fact-finding and trial. In ruling on summary judgment motions, the
Court does not make findings of fact. Rather, the Court assesses whether any material facts are
genuinely in dispute and, if they are not, resolves solely questions of law. If there are genuine
issues of material fact, the Court must deny motions for summary judgment, and the parties
proceed to trial.

       In contrast, under the regime of motions for judgment on the AR, governed by Rule 52.1,
the Court makes findings of fact based upon the administrative record. As the Federal Circuit
explained in Bannum, Inc. v. United States, the trial court must make factual findings “from the
record evidence as if it were conducting a trial on the record.” 404 F.3d 1355, 1357 (Fed. Cir.
2005). Then, the Court must determine if the agency’s conduct violated the law. Id. In adding
Rule 52.1 in 2006, this Court expressly acknowledged that “[s]ummary judgment standards are
not pertinent to judicial review upon an administrative record.” RCFC 52.1, Rules Committee
Notes, 2006 Adoption (citing Bannum, 404 F.3d at 1355-57).

        Despite the different procedural mechanisms, the standard of review for resolving bid
protests is substantially the same whether the protest is brought under § 1491(a) as a breach of an
implied contract or as a traditional bid protest under § 1491(b). In § 1491(a) protests, the Court
reviews whether the agency’s conduct was arbitrary and capricious. See Keco Indus., Inc. v.
United States, 192 Ct. Cl. 773, 783-84 (1970) (“[A]rbitrary and capricious action on the part of
the Government . . . clearly is a violation of the rule laid down in [Heyer Products Co. v. United
States, 135 Ct. Cl. 63 (1956)] that bids should be fairly and honestly considered.”); Wetsel-
Oviatt Lumber Co. v. United States, 40 Fed. Cl. 557, 565 (1998) (“An invitation for bids . . .
carries an implied contractual obligation to fairly and honestly consider all responsive bids. The
government breaches this implied contract if its consideration of the bids is found to be arbitrary,



finding CCS’ proposal “to be a very viable solution” and identifying CCS as financially strong,
with a strong product offering, substantial experience, and aggressive monitoring of the
network); Ala. Aircraft Indust., Inc.-Birmingham v. United States, 83 Fed. Cl. 666, 685 (2008)
(stating that “DCAA’s audit report, combined with payments of Alabama Aircraft expects to
earn on the KC–135 PDM contract, strongly support the conclusion that if awarded the contract,
Alabama Aircraft would have sufficient financial resources . . . .”), rev’d on other grounds, 586
F.3d 1372 (Fed. Cir. 2009).


                                                27
capricious, without rational basis, or an abuse of discretion.” (citations omitted)); see also
Prineville Sawmill Co. v. United States, 859 F.2d 905, 909 (Fed. Cir. 1988); Southfork Sys., Inc.
v. United States, 141 F.3d 1124, 1132 (Fed. Cir. 1988); Keco Indus., Inc. v. United States, 203
Ct. Cl. 566, 574 (1974)); L-3 Commc’ns, 94 Fed. Cl. at 397 n.3; FAS Support Servs., 93 Fed. Cl.
at 694. Under 28 U.S.C. § 1491(b)(4), the Court employs the standards set forth in the APA, 5
U.S.C. § 706, which requires the Court to set aside agency action found to be “arbitrary,
capricious, an abuse of discretion, or otherwise not in accordance with law.”

        In the instant case, a determination of whether the agency’s conduct was arbitrary and
capricious can be readily made utilizing the AR. Defendant has filed an ample administrative
record, and Plaintiff has invoked that record, seeking to add declarations from its executive vice
president and consultant. In short, all parties rely on facts in the AR in support of their requests
for judgment with very limited supplementation. As such, the Court treats Plaintiff’s motion for
summary judgment as a motion for judgment on the AR.

The Scope of the Record and Defendant’s Motion to Strike

       CCS seeks to support its protest with five declarations, three from Timothy Evard,
Executive Vice President of CCS, and two from Jimmy J. Jackson, a consultant, and the
Government moves to strike all these declarations. In resolving cross-motions for judgment on
the AR, the Court must assess whether CCS has justified its request to supplement the AR.
Axiom Res. Mgmt., Inc. v. United States, 564 F.3d. 1374, 1378-80 (Fed. Cir. 2009).

       Mr. Evard’s Declarations

        Mr. Evard’s first declaration, filed with CCS’ complaint, addresses: (1) CCS’ past
performance in providing information services, (2) the content of the RFP, (3) the content of
CCS’ proposal, and (4) the substance of meetings not otherwise described in the record. Evard
Decl. 1-8, Dec. 22, 2010. CCS filed the second Evard Declaration in response to the
Government’s argument that CCS waived its claims that AAFES violated 10 U.S.C. § 2492(a)
and that ARMP’s and FMWRC’s involvement in this procurement created improper conflicts of
interest. In this second declaration, Mr. Evard described CCS’ understanding of ARMP’s role
and network build-out plans at the time it submitted its proposal. Evard Decl. 1-8, Aug. 22, 2011
(“Second Evard Decl.”).

       Mr. Evard filed a third declaration in response to a Court order asking the parties whether
the Implementing Instructions were available to offerors prior to June 18, 2010, where that
information was made available, and whether CCS had knowledge of this information. 11 Mr.
Evard answered that this information was not available before June 18, 2010, that he was not
aware when or where it was made available, and that CCS did not have knowledge of this
information before June 18, 2010.



       11
           In its response, Defendant stated that the Implementing Instructions were available to
offerors prior to June 18, 2010, the information was made available online at a FMWRC web
address, and that CCS either knew or should have known the information.


                                                28
       To resolve the waiver issue, the Court must consider what CCS knew regarding ARMP’s
role and when CCS learned it -- matters not in the AR. As such, the Court supplements the
record with the third Evard declaration. Further, the Court supplements the record with
information on CCS’ knowledge of ARMP’s role in the procurement as reflected in Paragraphs
12 and 13 of Mr. Evard’s first declaration (discussing CCS’ bridge contract and communications
with ARMP and AAFES concerning ARMP’s future role) and Paragraphs 1 through 11 of Mr.
Evard’s second declaration (discussing CCS’ interpretation of the RFP, information presented at
Industry Day, and communications with ARMP and AAFES concerning ARMP’s future role).
The remainder of these two declarations either restates information in the solicitation and in
Resolute’s and CCS’ proposals or contains Mr. Evard’s personal opinion of Resolute’s proposal.
Mr. Evard’s opinion of Resolute’s proposal is not relevant, and his restatement of material in the
record is unnecessary and duplicative. See Arcow Corp. of Am. v. United States, 96 Fed. Cl.
270, 280 (2010) (excluding portions of a declaration because it merely detailed information
already contained in the record); cf. East West, Inc. v. United States, 100 Fed. Cl. 53, 57 (2011)
(excluding declaration that provided “information concerning the reaction of plaintiff to certain
agency communications”).

       Mr. Jackson’s Declarations

        Mr. Jackson is a consultant CCS retained to review AAFES’ responsibility
determination. 12 In his first declaration, filed with CCS’ motion for summary judgment, Mr.
Jackson addresses the finance-related aspects of Mr. Wright’s reviews and the contracting
officer’s and the Source Selection Committee’s decisions. His second declaration, filed in
support of CCS’ response to the Government’s motion for judgment on the AR, addresses
Resolute’s financial responsibility and AAFES’ calculation of the technical scores.

       Mr. Jackson opines that:

            •   Resolute did not have adequate financial resources and that “the contracting
                officer should have concluded that Resolute was not financially responsible.”
                Jackson Decl. ¶¶ 9, 10, July 18, 2011 (“First Jackson Decl.”); Jackson Decl. ¶¶ 9-
                11, Aug. 22, 2011 (“Second Jackson Decl.”);

            •   the assumptions in Mr. Wright’s financial models overstated Resolute’s ability to
                obtain financing, omitted interest-related expenses, inflated Resolute’s sales and
                revenues, and understated expenses, leading to an erroneous conclusion about
                Resolute’s financial outlook. First Jackson Decl. ¶¶ 41-67; and




       12
           Mr. Jackson has evaluated financial and cost analyses in more than 185 bid protests
and has been accepted as an expert by the Court of Federal Claims and Federal District Courts.
First Jackson Decl. ¶¶ 4(d), 4(g). He has two masters degrees, one in Business Administration
from Southern Illinois University and one in Science in Management from the Massachusetts
Institute of Technology’s Sloan School of Management. Id. at ¶ 3(b)-(c).


                                                29
           •   the revenue comparison that the Source Selection Committee relied upon
               improperly used a normalized penetration rate not disclosed to offerors instead of
               evaluating the projected financial benefits associated with each offer. Id. at ¶¶ 90-
               99.

        Mr. Jackson also analyzes the scoring of the technical evaluation and conducts his own
comparative analysis of portions of CCS’ and Resolute’s proposals, assigning different subfactor
scores. Second Jackson Decl. ¶¶ 3-4. In addition, Mr. Jackson questions the comparison of
Resolute’s and CCS’ proposals claiming AAFES failed to consider that CCS did not include
Alaska in its proposal, and performs his own analysis acknowledging this circumstance. Id. at
¶¶ 9-11. Finally, Mr. Jackson critiques the contracting officer’s past performance evaluation
because the agency only used a three-point scale -- Strong, Modest, and Weak -- “without
having a fourth possible score for Unacceptable,” a technique that in his view “masked the high
risk of Resolute’s financial performance.” First Jackson Decl. ¶¶ 85, 86.

        As the United States Court of Appeals for the Federal Circuit recognized in Axiom
Resource Management, Inc. v. United States, the parties’ ability to supplement the AR in a bid
protest is limited, and the “focus of judicial review of agency action remains the administrative
record, which should be supplemented only if the existing record is insufficient to permit
meaningful review . . . .” 564 F.3d at 1379-81. It is appropriate to supplement the AR when
“technical aspects of the procurement process [would] remain unexplained” without
supplementation or “when necessary for the Court to understand technical or complex
information involved in the challenged procurement.” Guzar Mirbachakot Transp. v. United
States, 104 Fed. Cl. 53, 63-64 (2012) (citations omitted) (supplementing the record with expert
testimony regarding electronic file compression and transmission utilities); Global Computer
Enters., Inc. v. United States, 88 Fed. Cl. 52, 67 (2010) (finding declarations necessary to
illuminate the difference between audit-supporting financial management system services and
mission and administrative support IT services); see also Mike Hooks, Inc. v. United States, 39
Fed. Cl. 147, 158 (1997) (permitting supplementation to enable the Court to understand technical
solicitation language regarding minimum production rates for shoal dredging).

        Consistent with these decisions, an expert in this case could have properly explained
complex financial principles and offered an opinion on their impact and application. There is a
fine line though between an expert offering technical analysis -- an acceptable addition to the
record -- and an expert substituting his subjective judgment for that of the Government in areas
not dependent upon complex technical matters. In the instant case, Mr. Jackson crossed that line.

        Mr. Jackson proffers his opinion on Resolute’s responsibility predicated on his subjective
evaluation of the record, not on any inscrutable technical matters. See First Jackson Decl. ¶ 12
(stating it was “irrational” for the contracting officer to find Resolute financially responsible
when it was “cleared for less than[ * * ] percent of the contract amount”); ¶ 17 (claiming the
contracting officer should have found Resolute’s Dun & Bradstreet Report to have been based on
outdated information); ¶ 25 (opining that Resolute’s financial statements support only an
unfavorable financial responsibility determination); ¶¶ 26-40 (questioning the contracting
officer’s interpretation of letters and communications from [ * * * * * ], and speculating that
Resolute was in “default” on its loan); ¶ 72 (stating that Mr. Wright’s financial model provides



                                                30
no “rational basis” for a favorable responsibility determination). Mr. Jackson’s opinion does not
provide technical clarification necessary for effective judicial review. Cf. Allied Tech. Grp., Inc.
v. United States, 92 Fed. Cl. 226, 231 (2010) (refusing to consider proffered declarations because
the AR was not too complex for the Court to review).

        Similarly, Mr. Jackson’s critique of AAFES’ evaluations are inappropriate
supplementation. See First Jackson Decl. ¶ 85 (stating that AAFES’ evaluation criteria for risk
scoring should have included an “unacceptable” score); see also Second Jackson Decl. ¶¶ 9-12
(presenting how Mr. Jackson would have calculated the AAFES fee percentages). Expert
opinions that purport to assess an agency’s procurement decisions are not proper
supplementation of the AR. In PlanetSpace Inc. v. United States, the Court rejected declarations
proffered by the plaintiff because they essentially “attack[ed] the merits of [the agency’s] award
decision.” 90 Fed. Cl. 1, 6 (2009). Although the PlanetSpace plaintiff claimed that the
declarations there were a technical aid to explain the pricing differences among proposals, the
Court found that the declarations re-argued the merits of the parties’ financing plans and
amounted to a “comparative assessment of the strengths and weaknesses of the proposals . . . .”
Id. at 8. So too, Mr. Jackson questions the correctness of the contracting officer’s and Source
Selection Committee’s conclusions. Whether or not the contracting officer and Source Selection
Committee and Source Selection Authority made “reasonable” decisions on these procurement
matters is a determination for this Court and is not a proper subject for expert opinion. Id.

         In Al Ghanim Combined Group Company General Trading & Contracting W.L.L. v.
United States, the Court excluded two declarations by Mr. Jackson in a bid protest. 56 Fed. Cl.
502, 504 (2003). In challenging the pricing evaluation, Mr. Jackson opined that the agency had
failed to perform a “price realism analysis” that would have revealed that the awardee’s pricing
was unrealistic. Id. at 511. The Court excluded Mr. Jackson’s declarations because they did not
“fill a gap in the record” or provide necessary clarification, stating:

       Even if characterized as expert testimony, Mr. Jackson’s opinions do not aid the
       court in its analysis of plaintiff’s arguments. Admissible expert testimony, as
       governed by [FRE] 702, must assist the trier of fact to understand the evidence or
       to determine a fact in issue. Plaintiff’s arguments are devoid of complexities that
       might require expert assistance, and plaintiff’s counsel is able to explain its
       arguments fully without the need of expert testimony.

Id. at 512 (citations and quotation marks omitted). Here, as in Al Ghanim, because Mr. Jackson
re-argues the merits of the Government’s award decision, his declarations are unnecessary for a
full and complete understanding of the issues in the protest.

Waiver Under Blue & Gold in § 1491(a)(1) Protests

        Defendant and Intervenor, relying on Blue & Gold Fleet, L.P. v. United States, 492 F.3d
1308, 1315 (Fed. Cir. 2007), seek dismissal of Counts I and II on the ground that CCS knew the
basis for these claims prior to the conclusion of the bidding process, but did not raise them until
after award. In Count I, CCS claims that Defendant violated 10 U.S.C. § 2492a by allowing
ARMP to either (i) compete for a contract to provide Personal Information Services directly to



                                                31
fee-paying users, or (ii) itself provide Personal Information Services directly to fee-paying users.
In Count II, CCS claims that ARMP’s role as a subcontractor and FMWRC’s participation on the
Source Selection Committee and its involvement, along with ARMP’s, in shaping the
solicitation, constituted organizational conflicts of interest.

       Is the Blue & Gold Waiver Doctrine Limited to § 1491(b) Protests?

        In Blue & Gold, the Federal Circuit held “that a party who has the opportunity to object
to the terms of a government solicitation containing a patent error and fails to do so prior to the
close of the bidding process waives its ability to raise the same objection subsequently in a bid
protest action in the Court of Federal Claims.” Id. at 1313. CCS argues that as a matter of law,
the Blue & Gold waiver doctrine only applies to bid protests brought under 28 U.S.C. § 1491(b),
not to protests invoking § 1491(a) jurisdiction, emphasizing the following language in Blue &
Gold:

       [A] party who has the opportunity to object to the terms of a government
       solicitation containing a patent error and fails to do so prior to the close of the
       bidding process waives its ability to raise the same objection afterwards in a
       § 1491(b) action in the Court of Federal Claims.

                                               ***

       Having recognized a waiver rule in § 1491(b) bid protest actions, we must decide
       whether the Court of Federal Claims erred in applying it to this case.

Id. at 1315 (emphasis added).

        While Blue & Gold itself concerned a § 1491(b) bid protest, there is nothing in the
decision that limits the waiver rule to bid protests predicated on § 1491(b) jurisdiction. What
drives the waiver rule is the pragmatic recognition that a bidder must object to the terms of a
patently erroneous solicitation while the Government can still remedy the situation. Id. at 1314-
15. The patent ambiguity doctrine as articulated in Blue & Gold is equally applicable in any bid
protest whether brought under § 1491(a) or (b). As the Federal Circuit explained:

       [The patent ambiguity] doctrine “was established to prevent contractors from
       taking advantage of the government, protect other bidders by assuring that all
       bidders bid on the same specifications, and materially aid the administration of
       government contracts by requiring that ambiguities be raised before the contract is
       bid, thus avoiding costly litigation after the fact.” These reasons . . . apply with
       equal force in the bid protest context. In the absence of a waiver rule, a contractor
       with knowledge of a solicitation defect could choose to stay silent when
       submitting its first proposal. If its first proposal loses to another bidder, the
       contractor could then come forward with the defect to restart the bidding process,
       perhaps with increased knowledge of its competitors.




                                                32
Id. at 1313-1314 (quoting Cmty. Heating & Plumbing Co. v. Kelso, 987 F.2d 1575, 1580 (Fed.
Cir. 1993)).

        There is no reason to disavow the Blue & Gold waiver rule merely because jurisdiction is
predicated on this Court’s general breach-of-contract jurisdiction instead of its more specific bid
protest jurisdiction. To hold otherwise would permit bidders in § 1491(a) protests to do exactly
what the Blue & Gold Court prohibited -- to roll the dice and wait to protest if they do not win.
As the Federal Circuit explained:

       It would be inefficient and costly to authorize this remedy after offerors and the
       agency had expended considerable time and effort submitting or evaluating
       proposals in response to a defective solicitation. Vendors cannot sit on their
       rights to challenge what they believe is an unfair solicitation, roll the dice and see
       if they receive award [sic] and then, if unsuccessful, claim the solicitation was
       infirm.

Id. at 1314 (alteration in original) (quoting Argencord Mach. & Equip., Inc. v. United States, 68
Fed. Cl. 167, 175 n.14 (2005)).

        The Federal Circuit recently reemphasized that the Blue & Gold waiver rule should be
broadly applied in bid protests in COMINT Systems Corporation v. United States, 700 F.3d 1377
(Fed. Cir. 2012). There, the Court held that the plaintiff waived its right to challenge an
amendment to the solicitation by not protesting before contract award, even though the
amendment was issued after the close of the bidding process. The Federal Circuit expanded Blue
& Gold by applying its reasoning “to all situations in which the protesting party had the
opportunity to challenge a solicitation before the award and failed to do so.” COMINT, 700 F.3d
at 1382. As such, the Federal Circuit extended the time a protestor may file a pre-award protest
from the “close of the bidding process” as articulated in Blue & Gold to any time before award is
made. See also Bannum, Inc. v. United States, 115 Fed. Cl. 257, 274 (2014). The Federal
Circuit recognized that “[t]he same policy underlying Blue & Gold supports it extension to all
pre-award situations.” COMINT, 700 F.3d at 1382.

        CCS contends that the Blue & Gold waiver rule should not apply in § 1491(a) protests
because the implied-in-fact contract giving rise to jurisdiction is not formed unless an offeror
submits a proposal, the very act which causes the waiver under Blue & Gold. Thus, CCS posits
that a plaintiff challenging a solicitation under § 1491(a) would have the Hobson’s choice of
either filing a protest prior to submitting a proposal, thus bypassing the requirement for
establishing § 1491(a) jurisdiction, or waiving its ability to protest by submitting a proposal.
Such a narrow and draconian view of the § 1491(a) bid protest process is unwarranted.

        CCS’ perceived dilemma was apparently spawned by an overly broad reading of
Motorola, Inc. v. United States, 988 F.2d 113 (Fed. Cir. 1993). CCS misconstrues Motorola to
establish a general principle that submission of a proposal is always required to establish the
implied-in-fact contract necessary for § 1491(a) pre-award protest jurisdiction. While the trial
court in Motorola did articulate that principle, the Federal Circuit, using limiting language in its
affirmance, did not adopt the trial court’s reasoning wholesale. The plaintiff in Motorola filed



                                                33
suit challenging a solicitation as being unduly restrictive and precluding it from submitting a bid.
The Motorola plaintiff based its assertion of implied contract jurisdiction on the Government’s
requests for, and Motorola’s submission of, information to assist the Government in developing
the solicitation. Id. at 114-15. In dismissing Motorola’s complaint for failure to state a claim,
the trial court concluded that “[s]ince there was no bid here, there was no promise; hence, no
basis for finding the existence of a pre-award contract upon which a claim for injunctive relief
can be based.” Id. at 116. 13

        In affirming Motorola, while agreeing that no implied contract arose because plaintiff had
not submitted a bid, the Federal Circuit added important qualifiers, stating that Motorola had
“not otherwise met its burden to show that an implied in fact contract existed,” and that
“[o]rdinarily a bid is required to establish that a pre-award implied in fact contract exists.” Id. at
114 (emphasis added) (citation omitted). This language underscores the appellate court’s
recognition that the submission of a bid is not the sine qua non for establishing an implied-in-fact
contract and acknowledges alternatives for “otherwise” establishing the implied-in-fact contract
necessary for pre-award protest jurisdiction. Further, the Federal Circuit expressly limited its
endorsement of the Motorola trial court’s opinion “to the extent consistent with the above”
reasoning. Id.

        The Federal Circuit’s refusal in Motorola to restrict the manner in which an implied-in-
fact contract can be formed in the pre-award procurement process setting is consistent with
fundamental principles of contract formation. As the Restatement (Second) of Contracts § 24
teaches, “[a]n offer is the manifestation of willingness to enter into a bargain, so made as to
justify another person in understanding that his assent to that bargain is invited and will conclude
it.” The Government’s manifestation of a willingness to enter a bargain and a vendor’s assent to
that bargain need not be exclusively expressed via a formal bid or proposal in the pre-award
context.

        But even if CCS were correct that it had to submit a proposal in order to form an implied-
in-fact contract giving rise to this Court’s jurisdiction, it could still have preserved its rights.
CCS could have protested the terms of the solicitation and in the alternative, timely submitted a
proposal that purported to respond to the allegedly flawed solicitation. In sum, CCS’ effort to
insulate § 1491(a) protests from the Blue & Gold waiver rule fails.




       13
            In so holding, the Motorola trial court departed from the holdings in Standard
Manufacturing Company v. United States, 7 Cl. Ct. 54 (1984) and Magnavox Electronics
Systems Company v. United States, 26 Cl. Ct. 1373 (1992). In Standard Manufacturing, the
court held that a contractor’s response to government requests for information created an implied
contract that all responses would be fairly and honestly considered, satisfying the jurisdictional
prerequisite for a pre-award bid protest under Section 1491(a). 7 Cl. Ct. at 58-60. Similarly, in
Magnovox, notices of intent to conduct a sole-source procurement published in the Commerce
Business Daily coupled with a contractor’s response that it could perform the work, resulted in
an implied contract to give the contractor’s response honest and fair consideration. 26 Cl. Ct. at
1377-78.


                                                 34
CCS Knew Its Grounds of Protest Prior to Award

         As explained above, parties who have the opportunity to object to the terms of a
solicitation containing patent errors or ambiguities and fail to do in a timely fashion waive their
ability to subsequently raise the same objections. COMINT, 700 F.3d at 1382; Blue & Gold, 492
F.3d at 1316; Bannum, 115 Fed. Cl. at 273-74.

       CCS Waived Its Claim of a Statutory Violation

       In Count I, CCS claims that the Government violated 10 U.S.C. § 2492a, which provides:
       (a) Limitation.—(1) Notwithstanding section 2492 of this title, the Secretary of
       Defense may not authorize a Department of Defense entity to offer or provide
       personal information services directly to users using Department resources,
       personnel, or equipment, or compete for contracts to provide such personal
       information services directly to users, if users will be charged a fee for the
       personal information services to recover the cost incurred to provide the services
       or to earn a profit.

       (2) The limitation in paragraph (1) shall not be construed to prohibit or preclude
       the use of Department resources, personnel, or equipment to administer or
       facilitate personal information services contracts with private contractors.

10 U.S.C. § 2492a.

        CCS alleges that ARMP was either competing for a contract to provide Personal
Information Services or providing these services directly to fee-paying users in violation of
§ 2492a, by acting as a subcontractor and continuing to build out its own network. However, by
waiting to file its protest until after award, CCS waived this ground of protest. The solicitation
clearly informed offerors that ARMP could be a subcontractor and lease its infrastructure to
offerors reiterating identical communications conveyed to offerors in the draft solicitation and
the Industry Day presentation. In CCS’ case, there was also a pre-solicitation exchange with
AAFES clarifying ARMP’s role.

        The draft solicitation expressly informed prospective offerors that ARMP could be
utilized as a subcontractor for “locations where ARMP [had] installed infrastructure,” and that
offerors would have the “option of leasing the ARMP network and equipment . . . .” AR 119-20.
Further, the draft solicitation listed several advantages of utilizing ARMP’s network.

      A few weeks later, the Industry Day briefing made clear that an offeror had the option to
use ARMP’s infrastructure in certain locations and to designate ARMP as its subcontractor. See
AR 275-76. Industry Day attendees, including CCS representatives, were informed that ARMP
would provide a variety of services, including “Internet Gateway & LAN Services” and “Internet
Access Device leasing.” AR 275. Industry Day attendees also learned that ARMP would




                                                35
provide these services in the Continental United States at “[m]ost major garrisons” with “[p]lans
to reach all garrisons in coming years.” AR 276. 14

       Just a few days after Industry Day, on May 3, 2010, CCS sent AAFES an email
requesting clarification of ARMP’s role, stating:

       Subject: RFP comments
       The ARMP role is a little confusing and the scope of [its] support is not clear.
       Will [it] only be able to provide support services where [it has] deployed
       [Personal Information Services] already? Will [it] be able to provide those
       services where [it deploys FMWRC Information Services] going forward (over
       [its FMWRC Information Services] network)? Is there any certainty around
       where and on what time schedule [it] will be able to provide services going
       forward?

AR 2943. The contracting officer responded, stating:

       a) ARMP is not limited to deploy [Personal Information Services] to provide
       support. The deployment of ARMP’s official service support network [FMWRC
       network] is independent from the for fee services that AAFES will offer.

       b) ARMP would need to confirm [its] capability outside the Army sphere and
       [FMWRC] network. As the [FMWRC] network expands, the capability to
       support providers will also expand; although, separate agreements and [Service-
       Level Agreements] are required with ARMP to consider future expansion.

Id.

        CCS claims that this exchange did not advise it that ARMP could be used for future
build-outs, and that the contracting officer’s answer was “vague” and “border[ed] on evasive.”
Pl.’s Reply & Opp’n 36-37, Aug. 22, 2011. According to CCS, it was not clear that ARMP’s
support included providing infrastructure. Id. at 37. CCS’ interpretation is untenable. CCS
asked: “Will [ARMP] only be able to provide support services where [it has] deployed [Personal
Information Services] already?” AR 2943 (emphasis added). The contracting officer said no,
stating “ARMP is not limited to deploy [Personal Information Services] to provide support,” and
added that ARMP’s expanding FMWRC Information Services network could be utilized via
separate agreements. Id.

        A few weeks after this clarification, the Government issued the solicitation, listing the
benefits of using ARMP as a subcontractor, and reiterating ARMP’s role and clarifying that the



       14
           Mr. Evard, CCS’ Executive Vice President, saw the slide “showing that ARMP had an
aggressive build-out plan,” but assumed that the information on the slide was out of date and
reflected ARMP’s plans before the December MOA. Second Evard Decl. ¶ 10. CCS’ erroneous
assumption does not change the fact that ARMP’s role was disclosed during Industry Day.


                                               36
ARMP network would continue to expand. AR 366-67. In a paragraph titled “ARMP as a
Potential Internet Sub-Contractor,” the solicitation stated that ARMP could provide both existing
and “planned” infrastructure. AR 366-67. CCS claims that “planned” referred only to projects
for which construction was already under way, but there is no basis in the record for CCS’ gloss.

        In sum, given the language in the draft and final solicitations, the Industry Day
presentation, and CCS’ exchange with AAFES, CCS knew that ARMP had been providing and
would continue to provide network infrastructure and other support services as a subcontractor to
the successful offeror -- the predicate for its claim that the Government violated 10 U.S.C.
§ 2492a. Even though it was aware of this alleged defect in the solicitation, CCS did not protest
until after it failed to receive the award. As such, CCS waived its ability to protest this statutory
violation under Blue & Gold.

The Court Declines to Invoke a Statutory Violation Exception to the Waiver Doctrine

        CCS argues that even if it waived its statutory claim, the Court should not apply Blue &
Gold because a significant statutory violation is at issue. Pl.’s Reply & Opp’n 43. CCS posits
that the Blue & Gold waiver rule originated in part from the Government Accountability Office’s
(“GAO”) timeliness rule. This rule permits GAO to consider an untimely protest “for good
cause shown, or where it determines that a protest raises issues significant to the procurement
system . . . .” Id. at 44 (quoting 4 C.F.R. § 21.2(c)). As CCS recognizes, GAO’s exception to
the timeliness rule applies “only where the untimely issue directly concerns the interpretation or
application of the procurement statutes or regulations on a matter of widespread interest to the
procurement community.” Id. (citing 4 C.F.R. § 21.2(c) and quoting DePaul Hosp. & The
Catholic Health Ass’n of the United States, B-227160, 87-2 CPD ¶ 173, 1987 WL 102790, at *4
(Comp. Gen. Aug. 18, 1987) (citations omitted)).

        CCS contends that this Court should adopt a similar exception because AAFES violated
the statute and contravened the legislative intent of prohibiting Government competition in the
commercial marketplace. Id. at 45. Even assuming arguendo that CCS is correct that AAFES
violated 10 U.S.C. § 2492a in this procurement, applying a statutory violation exception to the
Blue & Gold waiver rule would not be appropriate. The Blue & Gold waiver rule as extended by
COMINT is simple: if there is a patent ambiguity or error in the solicitation, a plaintiff must
seek redress in court prior to award. In fashioning and reaffirming this judicial waiver rule, the
Federal Circuit did not adopt GAO’s rule or practice, it applied a judicial doctrine, the patent
ambiguity doctrine, and recognized that it was unfair and inefficient to allow protestors to game
the system by waiting to raise problems with a solicitation until after they failed to receive the
award. As such, this Court declines CCS’ invitation to carve out an exception to the Blue &
Gold waiver rule.

       Even if the Court were to invoke GAO’s rule, GAO’s exception to waiver would not
apply here. As GAO has noted, “In order to prevent the timeliness rules from becoming
meaningless, the significant issue exception is strictly construed and seldom used,” and the
burden is on the untimely protestor to show that its protest is of “widespread interest to the
procurement community.” DePaul Hosp., 1987 WL 102790, at *4. Statutory violations of
widespread interest typically implicate broad procurement statutes. See Adrian Supply Co.-



                                                 37
Reconsideration, 66 Comp. Gen. 367, 368-69 (1987) (applying the exception to the timeliness
rule because of a failure to properly evaluate sealed bids in violation of the Competition in
Contracting Act); Ass’n of Soil and Found. Eng., B-199548, 80-2 CPD ¶ 196, 1980 WL 15985,
at *2 (Comp. Gen. Sept. 15, 1980) (applying the exception to the timeliness rule to a protest
involving the Brooks Act), rev’d on other grounds, B-199548.2, 82-2 CPD ¶ 128, 1982 WL
31895 (Comp. Gen. Aug. 13, 1982).

        Here, section 2492a is narrow. It only applies to a very limited category of procurements
within DoD -- NAFI contracts for “Personal Information Services” offered to users for a fee.
CCS has not persuaded the Court that an alleged violation of this narrow statute would have
sufficient widespread interest in the procurement community to vitiate a well-entrenched waiver
rule. See HMX, Inc., B-291102, 2003 CPD ¶ 52, 2002 WL 32072769 at *5 n.8 (Comp. Gen.
Nov. 4, 2002) (rejecting protestor’s claim that the applicability of the Commercial Space Act of
1998, Pub. L. 105-303, 112 Stat. 2843 (repealed 2010) involved an issue of “widespread interest
in the procurement community” justifying an exception to the timeliness rule); Goel Servs., Inc.,
B-310822.2, 2008 CPD ¶ 99, 2008 WL 2185937, at *2 (Comp. Gen. May 23, 2008) (finding that
a protest alleging an incorrect price evaluation for HUBZone firms under FAR 19.1308 was not
“of widespread interest to the procurement community warranting its resolution in the context of
an otherwise untimely protest”).

CCS’ Waiver of Its Organizational Conflict of Interest Claim

        In Count II, CCS claims that ARMP’s role as a subcontractor and FMWRC’s employees’
participation on the Source Selection Committee and involvement in shaping the solicitation
constituted an improper organizational conflict of interest in violation of AAFES’ regulations.15
CCS’ OCI argument centers on AAFES’ Exchange Service Purchasing Policies 65-1, which
governs all AAFES purchases. Paragraph 1-21 of this policy states:

       Selection of contractors and award of contracts must be made free of any conflict
       of interest. A conflict of interest exists when the person selecting items for
       purchase, selecting a contractor, placing an order or awarding a contract has a
       financial interest in the business of the firm receiving an order or contract, or is in
       a position to benefit because of a family interest. Contracting officers, their
       representatives, ordering agents and other AAFES personnel who are authorized
       to determine requirements, select items, or sign, approve, disapprove or
       administer contracts (including inspection), are required to disqualify themselves
       from contract transactions involving an actual or potential conflict of interest.

AR 7980.

      CCS posits that two FMWRC employees, David LaPradd and John Temple, who were on
the Source Selection Committee, and a third FMWRC employee, Nate Wills, an Army



       15
          Additionally, CCS claims violations of the FAR and Army Regulation 215-4, but these
regulations do not apply to NAFIs.


                                                 38
contracting specialist on the contracting team, had a financial interest in an award to Resolute,
because Resolute proposed using ARMP as its primary subcontractor and ARMP is an affiliate
of FMWRC. Specifically, CCS contends:

       ARMP, Resolute’s primary subcontractor, is an affiliate (i.e., a subsidiary
       organization) of their employer, FMWRC. Thus, at a minimum, these individuals
       had a “direct or indirect financial interest” or “other beneficial interest” in a
       “proposed subcontractor” of one of the firms submitting a proposal. Because they
       were involved in “selecting items for purchase, selecting a contractor, placing an
       order or awarding a contract” and, through their employer, had a “financial
       interest in the business of the firm receiving” award, these individuals had an
       impermissible conflict of interest.

Pl.’s Mem. in Support of Mot. Summ. J. (“Pl.’s Mem.”) 17, July 21, 2011 (internal citation
omitted).

        The Government argues that CCS waived this OCI claim because FMWRC’s
involvement was known to CCS prior to the deadline for submission of proposals, pointing to
slides from the Industry Day presentation. Resolute likewise argues that CCS waived this claim
because FMWRC/ARMP personnel attended the conference and identified themselves as
employees of FMWRC and ARMP, and attendees, including at least four CCS employees, saw a
slide entitled “Key Procurement/Operations Team” identifying three individuals from FMWRC
and one from ARMP as team members. Intervenor’s Mem. in Support of Cross Mot. J. 15; see
AR 279-80, 328-29. 16

        CCS contends that the Industry Day materials did not provide it with sufficient notice of
ARMP’s and FMWRC’s role because the slide did not indicate whether Messrs. LaPradd,
Temple, and Wills would be on the procurement or operations side. Pl.’s Reply & Opp’n 38.
CCS’ post-hoc interpretation of this slide is not persuasive. Even if the slide did not detail the
precise involvement of the FMWRC employees in the procurement, it put CCS on notice that
they would be “key” players, triggering a duty to inquire. As Intervenor argues, “[t]o the extent
[ARMP’s and FMWRC’s role] was unclear, CCS was obligated to seek clarification of the issue
and protest if there was any ambiguity.” Intervenor’s Reply 6. On several occasions, CCS
sought clarification or voiced complaints about other aspects of the procurement, and AAFES
regularly responded to these inquiries. Even though it was on notice of these individuals’ “key”
roles in the procurement, CCS did not raise its OCI complaint until after it was denied the award.
Therefore, CCS waived its ability to protest on these grounds under Blue & Gold.

CCS’ Organizational Conflict of Interest Claim Fails

       Even if CCS had not waived its OCI claim, this claim is unfounded. CCS’ OCI claim is
predicated on AAFES’ procurement policy, which provides: “A conflict of interest exists when



       16
          Neither Defendant nor Intervenor argue that CCS had notice of these employees’ roles
in the procurement by virtue of the Implementing Instructions.


                                               39
the person selecting items for purchase, selecting a contractor, placing an order or awarding a
contract has a financial interest in the business of the firm receiving an order or contract . . .”
AR 7980. AAFES enforced this aspect of its procurement policy by requiring the Source
Selection Committee members to complete and submit a Conflict of Interest Statement. AR
8139. The form stated:

       To the best of my knowledge and belief, no conflict of interest exists that may
       diminish my capacity to perform an impartial and objective review of the
       offeror’s proposal, or may otherwise result in a biased opinion or an unfair
       advantage. . . . In determining whether any potential conflict of interest exists, I
       agree to review whether my or my employer’s relationships with other persons or
       entities, including but not limited to, ownership of stocks, bonds, other
       outstanding financial interests or commitments, employment arrangements (past,
       present, or under consideration) . . . may place me in a position of conflict, real or
       apparent, with the evaluation proceedings.

AR 8142. Each member was required to complete the form and return it to the contracting
officer. AR 8139.

        However, Messrs. LaPradd, Temple, and Wills submitted a different form, entitled
Certificate for Personnel Participating in Source Selection Concerning Nondisclosure, Conflicts
of Interest, and Rules of Conduct. AR 8152 (Mr. LaPradd), 8154 (Mr. Temple), 8157 (Mr.
Wills). That form contained the following statement regarding conflicts of interest:

       To the best of my knowledge, I certify that neither I nor my spouse . . . have any
       direct or indirect financial interest in any of the firms submitting proposals, or
       their proposed subcontractors or have any other beneficial interest in such firm
       except as fully disclosed on an attachment to this certification.

Id. (¶ 2). None of these three employees disclosed a beneficial interest on an attachment. Id.

       Plaintiff claims that “[t]he representations made by Messrs. LaPradd, Temple, and Wills
in such forms are demonstrably and unassailably inaccurate,” based solely on the fact of their
employment at FMWRC, their roles on either the Source Selection Committee or the contracting
team, ARMP’s status as a potential subcontractor, and FMWRC’s relationship with ARMP.
Pl.’s Mem. 17-18.

        The mere circumstances of these employees’ positions and ARMP’s role do not establish
that the FMWRC personnel in question had a financial interest in Resolute. CCS’ OCI claim is
predicated solely on the fact that ARMP is an affiliate of FMWRC, Messrs. LaPradd, Temple,
and Wills’ employer. CCS asserts a broad-based speculative contention that these three
employees necessarily had a financial interest in ARMP based on this affiliation. In essence,
CCS would divine a prohibited financial interest on the part of these FMWRC employees “in the
business of” ARMP and attribute that interest to Resolute. Nothing in the record suggests that
ARMP’s performance under Resolute’s contract could have impacted the compensation of
Messrs. LaPradd, Temple, and Wills. CCS also ignores the fact that in its own proposal, it



                                                40
planned to use ARMP, thus creating the same conflict of interest it alleges. Specifically, CCS’
proposal stated: “CCS has plans and the necessary partnerships, including ARMP, in place to
roll services out to all locations . . . .” AR 713 (Tab 13). Of the 74 mandatory bases CCS
proposed to service with internet, CCS proposed using ARMP as its “deployment partner” at 18
locations, and using ARMP infrastructure where available. AR 804, 830-34 (Tab 13).

        In this procurement, contractors were offering to provide Personal Information Services
directly to service members. AAFES was to obtain a commission, but there was no showing that
such commission would inure to the benefit of FMWRC personnel. To demonstrate an
organizational conflict of interest, a protestor must identify “hard facts” -- a mere inference or
suspicion of a conflict is not enough. PAI Corp. v. United States, 614 F.3d 1347, 1352-54 (Fed.
Cir. 2010) (finding that no organizational conflict of interest existed because the plaintiff failed
to identify “hard facts”); see also JWK Int’l Corp. v. United States, 52 Fed. Cl. 650, 659 (2002),
aff’d, 56 F. App’x 474 (Fed. Cir. 2003); L-3 Servs., Inc., B-400134.11, 2009 CPD ¶ 171, 2009
WL 2883179, at *11 (Comp. Gen. Sept. 3, 2009) (finding no impaired objectivity when the
relationship between the firms was attenuated and the possibility of financial benefit was too
remote); Am. Mgmt. Sys., Inc., B-285645, 2000 CPD ¶ 163, 2000 WL 1507307, at *4-5 (Comp.
Gen. Sept. 8, 2000) (finding no organizational conflict of interest when the agency’s integration
contractor provided assistance in procuring software and the integration contractor and a
software vendor had an agreement to seek out joint opportunities because the potential benefit
was too speculative and remote); Prof. Gunsmithing Inc., B-279048, 1998 WL 526375, at *3
(Comp. Gen. Aug. 24, 1998) (finding alleged conflict of interest too speculative based on
consultant evaluator receiving royalty payments if a certain design were selected).

        Nor has CCS demonstrated the requisite prejudice to establish an OCI claim. As the
Court stated in JWK International Corporation v. United States, “[i]n short, even assuming the
existence of a conflict, plaintiff has not shown that ‘had it not been for the alleged error in the
procurement process, there was a reasonable likelihood that [it] would have been awarded the
contract.’” 52 Fed. Cl. at 658 (second alteration in original) (quoting Data Gen. Corp. v.
Johnson, 78 F.3d 1556, 1562 (Fed. Cir. 1996)); see also Galen Med. Assocs., Inc. v. United
States, 369 F.3d 1324, 1330 (Fed. Cir. 2004) (stating that to “prevail in a protest the protester
must show not only a significant error in the procurement process, but also that the error
prejudiced it.” (citation and quotation marks omitted)). Similarly, CCS has not shown that there
was a reasonable likelihood it would have received the award if Messrs. LaPradd and Temple
were not part of the evaluation team and Mr. Wills was not part of the contracting team. CCS
has not claimed that the two FMWRC personnel on the Source Selection Committee evaluated
CCS or Resolute differently than the other three voting Committee members. In fact, Resolute’s
score would have been higher than CCS’ score even if the evaluations of Messrs. LaPradd and
Temple were removed from the mix. As such, CCS’ claim that an organizational conflict of
interest existed in this procurement under AAFES’ procurement policies fails.

AAFES’ Evaluation of Proposals

       CCS claims that AAFES incorrectly evaluated the proposals by failing to use the
proposal scoring template and by normalizing the penetration rates.




                                                41
       Scoring

        CCS claims that AAFES’ numeric scoring of the offerors’ proposals did not reflect the
actual strengths and weaknesses assigned by the Source Selection Committee. Specifically, CCS
argues that the majority of the individual evaluators failed to use the “proposal scoring template”
which provided the following comment codes: SS = significant strength, S = strength, SW =
significant weakness, W = weakness, C = clarification, and R = risk. E.g., AR 1253, 10508.
Only one evaluator used the recommended comment codes, while the other evaluators either
used a plus, minus, and neutral system, or simply provided comments. E.g., AR 1308-13, 1369-
74, 1486-91 (using the required codes); AR 1248-1253, 1349-1354 (using mix of plus/minus and
written comments).
        CCS argues that the evaluators’ plus/minus system did not distinguish between strengths
and significant strengths or weaknesses and significant weaknesses, or identify risks. Given the
subjective assessments required, CCS fails to appreciate the discretion afforded technical
evaluators in scoring the technical elements in this procurement and overemphasizes the role of
the proposal scoring template. Neither the solicitation nor AAFES’ Exchange Operating
Procedure 65-13 required the use of comment codes for Significant Strengths, Strengths,
Weaknesses, Significant Weaknesses, and Risks. According to the solicitation, evaluators were
to numerically score proposals for each of the 11 evaluation factors, and justify the final ratings
“by drawing upon the strengths, weaknesses, and risks identified.” AR 453-54. The individual
evaluation sheets reflect that the evaluators complied with this requirement. Each team member
wrote notes articulating what aspects of each proposal warranted a given score. See, e.g., AR
1271 (noting that CCS has 10 years in the internet business and experience working on a military
base, as justification for a past performance score of [ * * * ] out of 100); AR 1389 (noting that
Resolute allows WiFi subscribers to print to Resolute printers and that gaming devices may be
associated with user accounts, as justification for a products score of [ * * * ] out of 100). The
failure to regurgitate the comment codes listed on the individual evaluator worksheets is a matter
of form, not substance, and does not warrant invalidating the technical evaluation. As the
Federal Circuit has recognized, challenges to the technical scoring involve the “minutiae of the
procurement process,” “discretionary determinations of procurement officials that a court will
not second guess.” COMINT, 700 F.3d at 1384 (quotation marks omitted) (quoting E.W. Bliss
Co. v. United States, 77 F.3d 445, 449 (Fed. Cir. 1996) (citations omitted)).
        CCS further argues that there is a disconnect between the Source Selection Committee’s
recommendation, the point scores assigned for each factor, and the strengths and weaknesses
listed in the attachment to the Committee’s Report. CCS submits that the ratings in the Report
were not justified by “‘drawing upon the strengths, weaknesses, and risk[s] identified’” as
required by the solicitation. See Pl.’s Mem. 40-43. These “disconnects” are summarized as
follows:

                                      The Final Weighted
   The Solicitation Factor                                               The Alleged Flaw
                                        Average Scores

                                 CCS: [ * * * ]                    [*** ************
Technical Design                                                   ****************
                                 Resolute: [ * * * ]               ****************


                                                  42
                                     The Final Weighted
   The Solicitation Factor                                             The Alleged Flaw
                                       Average Scores
                                                                 *************              ***
                                                                 *************              ***
                                                                 *************              ***
                                                                 *************              ***
                                                                 *************              ***
                                                                 *************              ***
                                                                 * * * * * * * * * * * ].

                                                                 [****************
                                CCS: [ * * * ]                   ****************
Scalability                                                      ****************
                                Resolute: [ * * * ]              ****************
                                                                 * * * * * * * * ].

                                                                 [****************
                                CCS: [ * * * ]                   ****************
Standards                                                        ****************
                                Resolute: [ * * * ]              ****************
                                                                 * * * * * ].

                                                                 [****************
                                                                 ****************
                                CCS: [ * * * ]
                                                                 ****************
Portability
                                                                 ****************
                                Resolute: [ * * * ]
                                                                 ****************
                                                                 * * * * * ].

                                                                 [****************
                                CCS: [ * * * ]
                                                                 ****************
Past Performance
                                                                 ****************
                                Resolute: [ * * * ]
                                                                 * * * * * * * * * ].

                                                                 [****************
                                CCS: [ * * * ]
                                                                 ****************
Speed to Market
                                                                 ****************
                                Resolute: [ * * * ]
                                                                 * * * * * * * * * * * * * * ]. 17




       17
           Resolute presented its analysis in a different format than CCS. While CCS presented a
full critical path graph for each installation, Resolute chose to group the installations into
categories, then provide a critical path for each category. Compare AR 804-26 (Tab 14) with AR
535-41 (Tab 13).


                                                 43
        CCS argues that the strengths and weaknesses identified in the Source Selection
Committee Report are “completely at odds” with the numeric scores. AR 1520. In so arguing,
CCS disregards the results of the Committee’s consensus evaluation of each proposal, which
assigned Resolute more strengths and fewer weaknesses overall than CCS. Compare AR 7825-
26, 7828-30 (Resolute’s strength/weakness determinations) with 7835-7839 (CCS’
strength/weakness determinations). For example, under the Technical Design factor, one of the
two most important evaluation factors, CCS received [ * * * ] weaknesses and [ * * * ] strengths
as compared to Resolute’s [ * * * ] weakness and [ * * * ] strengths, a finding that reasonably
supports to the higher score Resolute received. AR 7825, 7838. The same is true for the other
“disconnects” CCS alleged, with the difference in scores reflecting the strength/weakness
determinations:

           •   Scalability: Resolute had [ * * ] strengths and [ * ] weaknesses compared to CCS’
               [ * * ] strengths and [ * * ] weakness. AR 7828, 7836;

           •   Standards: Resolute had [ * * ] strengths and [ * ] weaknesses compared to CCS’
               [ * * ] strengths and [ * * ] weaknesses. AR 7828, 7836;

           •   Portability: Resolute had [ * * ] strengths and [ * ] weaknesses compared to CCS’
               [ * * ] strengths and [ * * ] weaknesses. AR 7826, 7835;

           •   Past Performance: Resolute had [ * * ] strengths and [ * * ] weaknesses compared
               to CCS’ [ * * ] strengths and [ * * ] weaknesses. AR 7829, 7837; and

           •   Speed to Market: Resolute had [ * * ] strengths and [ * * ] weakness compared to
               CCS’ [ * * ] strengths. AR 7826, 7835.
        This was a best value procurement, and the technical evaluators were charged with
assessing which proposal’s overall features, including technical design, products, portability,
speed to market, customer service, and business understanding, best met the Government’s
needs. As the Federal Circuit has recognized, “agencies ‘are entrusted with a good deal of
discretion in determining which bid is the most advantageous to the Government.’” Lockheed
Missiles & Space Co., Inc. v. Bentsen, 4 F.3d 955, 958 (Fed. Cir. 1993) (quoting Tidewater
Mgmt. Servs., Inc. v. United States, 216 Ct. Cl. 69, 83 (1978)); Glenn Def. Marine (ASIA), PTE
Ltd. v. United States, 720 F.3d 901, 911 (Fed. Cir. 2013) (citing E.W. Bliss, 77 F.3d at 449
(citations omitted)) (holding that a court will not second guess the discretionary determinations
of procurement officials regarding the minutiae of the procurement process including technical
ratings); COMINT, 700 F.3d at 1384 (same); Galen, 369 F.3d at 1330 (citing E.W. Bliss, 77 F.3d
at 449) (stating that the contracting officer has even greater discretion when a contract is to be
awarded on “best value” than on the basis of cost alone).

        CCS further alleges that the Source Selection Committee violated AAFES procurement
policies by using flawed ratings and failing to justify the numeric scores given to CCS and
Resolute. The record does not support this allegation. Rather, the record reflects that each
voting member of the Source Selection Committee independently evaluated and scored each
evaluation factor for each proposal and wrote comments explaining or justifying the member’s
independent determination. AR 1248-1499. For example, for the Products evaluation factor,


                                               44
one member gave CCS a score of [ * ], with comments that CCS could “rollout by June 2011 as
requested,” had “multiple ‘architectures’ of systems used to serve different bases/environments,”
and could provide internet in public hotspots. AR 1248. A different Committee member gave
CCS a score of [ * ] for the Products evaluation factor, noting that CCS “complies with all
requirements,” that it was “[c]urrently providing internet service through DSL equipment,” that it
had “[g]ood experience in [the] military environment, but seems to offer only one method, either
DSL or Cable modem,” and that it had “[l]imited offerings dependent on partnership.” AR 1328.
While the individualized ratings spanned a wide range, this does not mean they were flawed or
erroneous. Instead, this circumstance highlights the subjectivity of the evaluation process and
the reality that different aspects of CCS’ offer were valued by the individual raters. “This Court
does not sit as a super source selection authority to second guess and re-score offerors’
proposals.” AshBritt, Inc. v. United States, 87 Fed. Cl. 344, 367, opinion clarified by, 87 Fed.
Cl. 654 (2009); Ne. Military Sales, Inc. v. United States, 100 Fed. Cl. 103, 110 (2011) (“[T]he
evaluation of proposals for their technical excellence or quality is a process that often requires
the special expertise of procurement officials, and thus reviewing courts give the greatest
deference possible to these determinations.” (citation and quotation marks omitted)). CCS has
not demonstrated that the ratings were flawed, or the numeric scores unwarranted. See
COMINT, 700 F.3d at 1384.

        CCS also contends that the Source Selection Committee’s consensus scores were
inadequately justified. Once the individual evaluations were completed, Source Selection
Committee members met to determine their consensus scores and modified their individual
scores as a result of the discussion. See AR 7492 (EOP 65-13 ¶ 4-23). The modifications were
either made directly on score sheets or were reflected as differences between the numerical
scores on individual score sheets and the final Source Selection Committee Proposal Scoring
Spreadsheet, which reflected the consensus numbers. E.g., AR 1270-73 (noting changes in
specific factor scores “after discussion”); AR 1328-33 (highlighting several large point increases
for CCS from its original score).

        Below is a summary of the changes between the initial individual scores and the Source
Selection Committee’s Proposal Scoring Spreadsheet for Resolute’s and CCS’ proposals for
internet services:

                Individual Source Selection Committee Member Scores for CCS 18

                    Individual Scores Pre Consensus Meeting   Individual Scores Post Consensus Meeting
Evaluation Factor   JT      DL      AM      MK       MV       JT      DL       AM      MK       MV
                    [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
Products
                    [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
Portability
                    [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
Marketing
                    [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
Technical Design
                    [***]   [***]   [***]   [***]    [***]    [***]   [***]    [***]   [***]    [***]
Scalability


        18
          This comparison is derived from scores on individual score sheets in AR 1248-1432
and on the Source Selection Committee’s Proposal Scoring spreadsheet in AR 1228 and 1230.


                                                    45
                    [***]       [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]
Standards
                    [***]       [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]
Speed to Market
Customer Account
Service             [***]       [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]

Customer Care and
Customer
                    [***]       [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]
Satisfaction
                    [***]       [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]
Past Performance
Business
Understanding and
                    [***]       [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]
Reporting

AR 1228, 1248-53, 1268-73, 1290-95, 1308-13, 1328-33.

               Individual Source Selection Committee Member Scores for Resolute

                        Individual Scores Pre Consensus Meeting            Individual Scores Post Consensus Meeting
Evaluation Factor
                        JT        DL        AM        MK         MV        JT        DL        AM        MK        MV
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Products
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Portability
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Marketing
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Technical Design
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Scalability
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Standards
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Speed to Market
Customer      Account
Service                 [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]


Customer Care and
Customer Satisfaction   [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]

                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Past Performance
Business
                        [***]     [***]     [***]     [***]      [***]     [***]     [***]     [***]     [***]     [***]
Understanding

AR 1230, 1349-54, 1369-74, 1389-94, 1407-12, 1427-32.

       These tables show that as a result of Source Selection Committee discussions, individual
Committee members reconsidered and at times altered their original scores. The modified
individual scores were then converted into weighted scores for each factor by each individual
evaluator. AR 1228, 1230. The average of each individual evaluator’s modified weighted score
was then used as a final score for ranking the proposals. AR 1228, 1230, 1525, 1552-54.

       CCS does not argue that the comments and explanations accompanying these scores were
inaccurate. Rather, CCS contends that, because not every comment or explanation of a strength
and weakness was quoted in the Source Selection Committee Report, the scores were somehow
flawed. However, the evaluators’ comments indicate that they weighed the merits of each


                                                            46
proposal and considered all aspects of the proposals in arriving at their scores and rankings.
There is no reason for this Court to second guess the scoring here. “[I]t is well established that
the Court should not substitute its judgment to assess the relative merits of competing proposals
in a government procurement.” AshBritt, 87 Fed. Cl. at 367 (citing R & W Flammann GmbH v.
United States, 339 F.3d 1320, 1322 (Fed. Cir. 2003)).

        CCS also claims that the record does not support AAFES’ representation that it called
each offeror’s past performance reference, but this allegation is belied by the AR. AR 1520,
7840. The Source Selection Committee Report states that “[r]eferences for each offeror were
contacted and used in evaluations. The reference calls were incorporated into the past
performance factor and scored accordingly. No information was received from the reference
calls that resulted in any scoring impact.” AR 1520. The record reflects that each voting
member of the Source Selection Committee made reference calls and documented the
information from each call. See AR 1266-67, 1286-87, 1326-27, 1346-47 (reflecting eight
reference calls about CCS and noting customers’ feedback, e.g., customer was “very pleased
with [CCS’] performance,” CCS had “great customer support” and was “on target [with]
everything”); 1367-68, 1387-88, 1425-26, 1445-46 (reflecting eight reference calls about
Resolute and noting customers’ feedback, e.g., customers were “very pleased with [Resolute’s]
performance” and “happy [with Resolute] on service and response to problems,” and Resolute
had a “well dedicated model” and was “very responsive to all customer needs”).

        Lastly, CCS claims that the Source Selection Authority adopted the “flawed ratings”
without discussing the significance of the technical differences in terms of contract performance
or governmental needs. According to CCS, the Source Selection Decision highlighted the same
scores, strengths, and weaknesses identified by the Source Selection Committee without
“digging deeper and analyzing the significance of the scores.” Pl.’s Mem. 45. However, CCS
has not shown that the underlying technical evaluations were incorrect, irrational, or
inadequately documented, or that the findings here warranted “digging deeper.” Indeed, CCS
ignores the fact that the Source Selection Committee found Resolute to be the hands down
choice in the technical and past performance factors. The Committee’s Report stated:

       With the exception of the corporate financial position, this is clearly the best
       proposal.

       . . . Resolute has strong, flexible product options with ample bandwidth and value
       enhancements to offer customers. Network design and options for providing
       service are robust, leveraging [its] extensive experience with AAFES. Resolute
       consistently presented superior solutions to all factors requested within the RFP.

AR 1520-21.

AAFES’ Fee Evaluations

       CCS claims that AAFES’ evaluation of price proposals was arbitrary and capricious
because AAFES improperly “normalized” the offerors’ price proposals in two respects: (1) it
used a “normalized penetration rate” -- the estimated percentage of the base population that
would pay for internet service -- based solely on ARMP’s subscription information, and (2) it


                                               47
used a “normalized base revenue figure.” CCS contends that the normalized penetration rate was
improper because the solicitation allowed offerors to choose their technical approaches and did
not force them to use ARMP. CCS claims the agency’s use of a normalized base revenue figure
was unnecessary because offerors submitted pro forma Operating Statements and cost
projections as required by the RFP. CCS further contends that because these normalized
protocols were not disclosed in the solicitation CCS was prejudiced.

        The purpose of normalization is to measure offers against the same “baseline.” As this
Court has recognized, it is appropriate to use normalization techniques in procurements when
there is no logical basis for differences in approach or when there is insufficient information
available to accurately evaluate proposals. Computer Scis. Corp. v. United States, 51 Fed. Cl.
297, 316 (2002) (citation omitted). Normalization allows the agency to establish a common
“should have bid” estimate. Id. (citation omitted). It segregates “cost factors which are
‘company unique’ . . . from those which are generally applicable to all offerors . . . .” Univ.
Research Co., LLC v. United States, 65 Fed. Cl. 500, 510 (2005) (quotation marks omitted)
(quoting Computer Scis., 51 Fed. Cl. at 316 (citation omitted)). In order to overturn an agency’s
normalization decision, the protestor must demonstrate that the choice made by the agency was
irrational. Marquette Med. Sys., Inc., B-277827.5, B-277827.7, 99-1 CPD ¶ 90, 1999 WL
311686, at *5 (Comp. Gen. Apr. 29, 1999).

       To calculate the projected financial benefit of offers, AAFES used the following formula:

       Projected Income = Base Population x Price x Fee Percentage x Penetration Rate

AAFES’ independent consultant, Deloitte, calculated standard penetration rates for these services
based on FMWRC’s historical usage rates in the Continental United States. AR 5876, 5879.
The rates used were 1.8% for pre-paid hourly service, 1.1% for pre-paid daily service, 0.8% for
pre-paid weekly service, and 2.9% for pre-paid monthly service. AR 5879.

        In their pro forma Operating Statements, offerors assumed different penetration rates,
which translated into different potential revenues. CCS proposed a flat fee of [ * * * ] based on a
[ * * * * * * ] penetration rate, while Resolute proposed fees from [ * * * * * ] based on a
penetration rate of [ * * * * ]. Neither offeror allowed for different penetration rates depending
on whether a customer chose hourly, daily, weekly, or monthly service options, yet AAFES’
historical data showed that there were different rates for these services. Because the dollar
amount that AAFES would receive in fees was pegged to usage and dependent upon accurate
penetration rates, AAFES needed to compensate for either overstatements or understatements of
potential usage in order to accurately measure revenues. Normalizing the penetration rate
allowed AAFES to accurately measure how CCS’ and Resolute’s different fee percentages
would translate into dollars received by AAFES. Thus, CCS has not shown that AAFES’
decision to normalize the penetration rate was unreasonable or prejudicial.

AAFES’ Responsibility Determination of Resolute

       According to AAFES policy, a responsible prospective contractor must meet seven
minimum standards. See AR 8020 (ESR Policy 65-1 ¶ 4-46). At issue in this case are two
standards -- that a prospective contractor must (1) have adequate financial resources, or the


                                                48
ability to obtain such resources as required during performance, and (2) have a record of
satisfactory performance “or be able to document beyond reasonable doubt that any prior
problems that created a marginal or unsatisfactory situation have been eliminated.” Id. CCS
argues that the responsibility determination was arbitrary and capricious because the contracting
officer unreasonably concluded that Resolute had adequate financial resources and that its prior
performance difficulties had been resolved.

       The Financial Responsibility Determination

        CCS claims there is inadequate factual support to conclude that Resolute had sufficient
financial resources to perform the contract and that AAFES placed too much emphasis on how
the contract award would improve Resolute’s financial outlook. “Contracting officers are
‘generally given wide discretion’ in making responsibility determinations and in determining the
amount of information that is required to make a responsibility determination.” Impresa
Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1334 (Fed. Cir. 2001)
(citing Grimberg, 702 F.2d at 1367); NCL Logistics Co. v. United States, 109 Fed. Cl. 596, 610
(2013); Afghan Am. Army Servs. Corp. v. United States, 106 Fed. Cl. 714, 722 (2012); Tech
Sys., Inc. v. United States, 98 Fed. Cl. 228, 266 (2011). The Court “cannot substitute [its]
judgment for that of the contracting officer in making responsibility determinations.” Bender
Shipbuilding & Repair Co. v. United States, 297 F.3d 1358, 1362 (Fed. Cir. 2002) (upholding a
financial responsibility determination because even though the awardee had financial problems,
the contracting officer examined the financial data before him and articulated a rational
explanation for his decision).

        Under AAFES’ procurement policy, in order to be financially responsible, a prospective
contractor must have “adequate financial resources, or the ability to obtain such resources, as
required during the performance of the contract.” AR 8020. The contracting officer here
considered Resolute’s past financial difficulties, but placed more weight on the likelihood of
Resolute’s improved financial future, which was permissible under AAFES’ policy -- requiring
that a contractor have the “ability to obtain” adequate financial resources. This is not arbitrary
and capricious or irrational action.

        A paramount element of CCS’ challenge to Resolute’s responsibility determination
concerns Resolute’s [ * * * * * * * * * * * * * * * ]. CCS claims that Resolute was in “default”
on this loan, but nothing in the record supports a conclusion that Resolute had defaulted or
missed payments on its [ * * * * * * * * * * * * * * * ]. The contracting officer was aware of the
loan. AAFES contacted the bank, and the bank provided documentation showing that Resolute
was repaying the loan. AR 1755, 8539, 8540-41. Further, the bank [ * * * * * * * * * * * * * * *
* * * * * * * * ]. Instead of finding Resolute in default, [ * * * * * * ] unequivocally stated that
Resolute was a stable business, “performing per its agreed loan terms with [ * * * * * ],” that the
bank would continue to support Resolute and was comfortable with Resolute’s ability to meet its
obligations. AR 8540.

       A responsibility determination is a business judgment, and contracting officials enjoy
wide discretion in determining whether proceeding to award a contract to a particular entity
poses undue risk. NCL Logistics, 109 Fed. Cl. at 623 (citations omitted). Here, the agency
made this award fully aware of Resolute’s financial challenges and determined Resolute to be


                                                49
responsible. See Ettefaq-Meliat-Hai-Afghan Consulting, Inc. v. United States, 106 Fed. Cl. 429,
436 (2012) (citations omitted) (“[T]his type of assessment is a quintessential business judgment,
and this Court will not second guess the contracting officer’s judgment where there is supporting
evidence.”). In Bender Shipbuilding, the Federal Circuit affirmed a financial responsibility
determination where the Army awarded a contract to a bidder that had recently filed for
bankruptcy under Chapter 11. 297 F.3d at 1362-63. The contracting officer in Bender
Shipbuilding acknowledged the seriousness of the company’s financial situation but awarded it
the contract, based in part on a guarantee of performance by the offeror’s parent company and
the availability of progress payments under the contract. Id. at 1360. In upholding the decision,
the Federal Circuit noted the “wide discretion” that contracting officers have in making
responsibility determinations and acknowledged that the awardee and its parent had financial
problems, but did not disturb the contracting officer’s determination that the awardee was
financially responsible. Id. at 1362. The awardee in Bender Shipbuilding was in a more
precarious position than Resolute here. There is no indication that Resolute was approaching
bankruptcy, and Resolute demonstrated that it had support from [ * * * * * * ]. CCS has not
shown that the contracting officer abused her discretion in finding Resolute responsible.

        Citing the Vendor Financial Clearance data, CCS argues that since Resolute was not
cleared for the full contract amount, or even for [ * ] of the contract amount, it should not have
been found financially responsible. A financial clearance is “an independent source of
information for the contracting officer” indicating a “firm’s financial capability.” AR 8033.
Financial clearance under AAFES’ policy is only required for “merchandise, supplies, and
equipment purchases.” Id. The purpose of AAFES’ financial clearance policy is to “make sure
the supplier will ship ordered merchandise timely and will reimburse AAFES for returns (QA
rejections, recalls, aged merchandise, and so forth).” Id. This contract was not for the purchase
of “merchandise, supplies, or equipment,” but rather involved provision of telecommunication
services to users for a fee with a portion of that fee going back to the NAFI. As such, the
financial arrangement here did not pose the type of risk AAFES’ financial clearance was
intended to address. In any event, AAFES policy states that the financial clearance process does
not, by itself, dictate responsibility. Id. The policy allows a contracting officer to find an
awardee financially responsible even if it does not receive financial clearance in an amount
equivalent to the proposed purchase. Id.

       CCS further challenges AAFES’ use of financial statements. CCS correctly observes that
the contracting officer erroneously claimed that Resolute’s financial analysis was based on
“audited financial statements for 2007, 2008, and 2009.” AR 1755 (emphasis added). In fact,
Resolute submitted audited statements for 2007 and 2008, and unaudited statements for 2009.
While CCS claims the absence of audited statements for 2009 should have “set off alarm bells,”
its own actions belie this claim. CCS itself did not submit audited financial statements. AR
1011.

        The remainder of CCS’ challenges to the financial responsibility determination rest solely
on matters the Court may not address -- declarations that are not in the record containing Mr.
Jackson’s opinions as to Mr. Wright’s financial analysis and the contracting officer’s decision.
The record provides no basis for this Court to overturn the contracting officer’s responsibility
determination. AAFES and the contracting officer were fully aware of Resolute’s financial
difficulties. AAFES’ expert, Mr. Wright, acknowledged that Resolute faced severe financial


                                               50
challenges, but projected that if Resolute received the award of the AAFES contract, Resolute’s
financial outlook would greatly improve. AR 1755, 8484. The contracting officer reasonably
relied on Mr. Wright’s analysis, noting not only that award would improve Resolute’s financial
outlook, but that Resolute would be able to “meet commission payment requirements during the
contract period of performance.” AR 1756. As Bender Shipbuilding established, it is
permissible for a contracting officer to consider income that a contractor would receive if the
contract at issue were awarded. 297 F.3d at 1362-63.

       Consideration of Past Performance in the Responsibility Determination

        CCS attempts to find fault with the contracting officer’s consideration of Resolute’s past
performance, arguing that the contracting officer ignored critical information. The contracting
officer identified two main past performance issues for Resolute. The first was a warning letter
dated October 16, 2009, for a service disruption. AR 1757. The contracting officer noted that
the issue had been resolved in a timely manner and that service had been restored the same day.
The second issue was a demand for the nonpayment of fees issued on January 13, 2010, and CCS
claims that the contracting officer ignored a cure notice from February 2010, but this allegation
is not supported by the record. The February 2010 letter discussed the same debt referenced in
the January 13, 2010 letter, provided Resolute with an additional 30 days to provide a “more
definitive action plan” and was part of the corrective action process referenced in the
responsibility determination. AR 10529; see AR 1757-58. The contracting officer found that
Resolute took sufficient corrective action, including a renegotiation of debt owed to AAFES.
AR 1757-58. While the contracting officer did not cite the February 2010 letter, this is not a
basis to overturn her responsibility determination. As the contracting officer noted, Resolute
began making payments on all debts in July 2010, and had consistently made payments since
then. AR 1758.

       The Alleged Appearance of Impropriety

        CCS alleges that the debt Resolute owed AAFES from a prior contract created an
appearance of impropriety. CCS claims that FMWRC’s and ARMP’s involvement in the
procurement, coupled with their and AAFES’ interest in Resolute, created an “aura of
inevitability” in the outcome of the competition, and skewed the competition in favor of
Resolute. However, CCS has not cited any case where a procurement was overturned on the
ground that a debt of an awardee to a government procuring entity created an appearance of
impropriety.

        CCS contends that there was an appearance of impropriety for several reasons. First,
CCS claims that Resolute’s debt gave AAFES an interest in the financial success of Resolute and
a reason to favor Resolute in the competition. However, as the Government points out, Resolute
and AAFES had agreed upon a new payment schedule prior to award, and Resolute was current
under that schedule. Further, the record contains no evidence that the debt affected any member
of the Source Selection Committee, their scores, or the evaluations of any offerors.

       Second, CCS argues that due to AAFES’ partnership with FMWRC, AAFES had a
vested interest in the outcome of the procurement, FMWRC as ARMP’s parent organization



                                               51
would benefit from the fees Resolute would pay to ARMP for use of ARMP’s network, and an
award to Resolute would significantly expand ARMP’s market share. However, there is no
proof that the relationships of ARMP, AAFES, and FMWRC with Resolute were any different
than their relationships with CCS. Both CCS and Resolute had prior working relationships with
ARMP, and like Resolute, CCS planned to use ARMP at bases covered under the contract -- as
the solicitation permitted. AR 830-34.

        Third, CCS points to an email from Resolute to an ARMP employee requesting that the
employee inform AAFES how well Resolute and ARMP worked together as a team on an earlier
project. The email states:

       AAFES will be evaluating bidders on their technical abilities and speed to market
       as extremely important criteria. The fact that ARMP and Resolute working
       together completed our [transfer of function] responsibilities within 35 days of
       our actually being told we could proceed. I believe this shows we make a
       formidable rapid response team. Any way you can get this information to them in
       writing [which] can only help our mutual case[?] Bill Hart/ARMP was listed as a
       reference in our reference binder that was submitted 3 weeks ago so there may be
       a couple ways you could get this scorecard to the right folks. Indirectly, I hope
       John Temple and Nate Wills are also aware of our mutual accomplishments.

AR 2195. According to CCS, this email shows both that Resolute was attempting to use its
relationship with ARMP to its advantage in the evaluation and that ARMP had an interest in the
procurement. The Government notes that no employee of ARMP, FMWRC, or AAFES ever
responded to the email or agreed to reach out on Resolute’s behalf. Nor is there any evidence
that any member of the Source Selection Committee was contacted as a result of this email. As
such, this email does not create an appearance of impropriety.

        The Government argues that CCS’ appearance of impropriety argument is actually an
allegation of bias in favor of Resolute on the part of government officials, and that CCS cannot
meet the evidentiary standard to show bias which requires overcoming the presumption of good
faith. In Space Age Engineering, Inc. v. United States, the Court applied the bias standard to an
appearance of impropriety claim. 4 Cl. Ct. 739, 743-45 (1984) (finding that inferences and
allegations failed to constitute the “clear and convincing proof” required to show impropriety on
the part of the government).

        CCS disputes that it alleged bad faith or bias, and thus argues it should not be required to
meet the standard of “well-nigh irrefragable proof.” Whether one characterizes CCS’ claim as
bias or an appearance of impropriety, CCS must demonstrate hard facts to prevail. Turner
Constr. Co. v. United States, 645 F.3d 1377, 1387 (Fed. Cir. 2011); see also CACI, 719 F.2d at
1583 (overturning trial court’s decision to enjoin contract award based on an appearance of
impropriety when the decision was based on “suspicion and innuendo” rather than hard facts);
Four Points By Sheraton v. United States, 66 Fed. Cl. 776, 787 (2005) (rejecting plaintiff’s
allegation of bias based upon alleged inconsistent or erroneous evaluations as vague and without
evidentiary support); Jacobs Tech. Inc. v. United States, 100 Fed. Cl. 198, 218 (2011) (finding
that alleged access to offices, participation in meetings, and roles in development of databases



                                                52
were not “hard facts” showing that a contractor obtained specific non-public source selection
information about a pricing evaluation). In Dynalectron Corporation v. United States, the Claims
Court declined to find an appearance of impropriety because the allegation was based on
suspicion and innuendo, stating, “Plaintiff wants relief because of how [the procurement] looked,
not because of how it was.” 4 Cl. Ct. 424, 430 (1984).

        The only evidence proffered by CCS in support of this appearance-of-impropriety claim
is the email from Resolute to ARMP requesting that ARMP put in a good word for Resolute due
to the good quality and speedy implementation of Resolute’s prior work for ARMP. This email
is similar to the situation addressed in Galen where the awardee listed a technical evaluator as a
past performance reference, and the Federal Circuit held that the evaluator’s name on a list of
references was insufficient to show that the procurement was tainted. 369 F.3d at 1335-37.
Similarly, the fact that Resolute requested an ARMP employee to provide what was essentially a
past performance reference does not taint the competition here. As noted above, no employee of
ARMP, FMWRC, or AAFES ever responded to the email, and there is no evidence in the record
that ARMP contacted any member of the Source Selection Committee as a result of Resolute’s
email. CCS has failed to present sufficient evidence of an appearance of impropriety that tainted
the award.

                                          Conclusion

        1.     The Court GRANTS IN PART Defendant’s motion to strike the declarations of
Timothy Evard and Jimmy J. Jackson. The Court supplements the record with Paragraphs 12
and 13 of Mr. Evard’s first declaration, 1 through 11 of Mr. Evard’s second declaration, and the
entirety of Mr. Evard’s third declaration, and strikes the remainder of Mr. Evard’s declarations.
The Court strikes Mr. Jackson’s declarations.

        2.    The Court DENIES Plaintiff’s motion for summary judgment (treated as a motion
for judgment on the administrative record).

      3.      The Court GRANTS Defendant’s and Defendant-Intervenor’s motions for
judgment on the administrative record.

       4.      The Clerk is directed to enter judgment accordingly.

                                             s/Mary Ellen Coster Williams
                                             MARY ELLEN COSTER WILLIAMS
                                             Judge




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