          In the United States Court of Federal Claims
                                     No. 18-1637C
                             (Filed: February 26, 2019)
              *Opinion originally filed under seal on February 21, 2019


                                          )
 ADVANCED CONCEPTS                        )      Pre-Award Bid Protest; Subject Matter
 ENTERPRISES, INC.,                       )      Jurisdiction; Standing; Qualified to
                                          )      Compete; Nontrivial Competitive
                     Plaintiff,           )      Injury; Office of Hearing and Appeals;
                                          )      NAICS Code; Past Performance
 v.                                       )      Evaluation.
                                          )
 THE UNITED STATES,                       )
                                          )
                     Defendant.           )
                                          )

Robert John Wagman, Jr., Washington DC, for plaintiff, Laura Prebeck Hang and
Joshua M. Freda, Washington DC, of counsel.

Amanda L. Tantum, Civil Division, United States Department of Justice, Washington,
DC, with whom were Joseph H. Hunt, Assistant Attorney General, Robert E. Kirschman,
Jr., Director, and Martin F. Hockey, Jr., Deputy Director, for defendant. Brian
Chapuran, Associate General Counsel – Acquisition, Missile Defense Agency, Office of
General Counsel, Washington DC, of counsel.

                                       OPINION

FIRESTONE, Senior Judge

      Plaintiff, Advanced Concepts Enterprises, Inc. (“ACEs”) brought this pre-award

bid protest matter seeking to enjoin the United States Department of Defense, Missile

Defense Agency (“MDA”) from proceeding with the Request for Proposals No.

HQ01470-18-R-0009 (the “Solicitation”) on the grounds that (1) the United States Small

Business Administration’s Office of Hearings and Appeals (“OHA”) decision to uphold
MDA’s designation of the North American Industry Classification System (“NAICS”)

code 5417151 for the Solicitation was arbitrary, capricious, an abuse of discretion, and

contrary to law because NAICS code 5415132 was more applicable to the Solicitation’s

work, and (2) MDA’s selection of past performance evaluation criteria in the Solicitation

contrary to law because it failed to provide for a comparative evaluation of past

performance among offerors and because it treated offerors with no relevant past

performance as “acceptable” and thus favorably.

       The parties have filed cross-motions for judgment on the administrative record

pursuant to Rule 52.1 of the Rules of the United States Court of Federal Claims

(“RCFC”). ACEs’ Mot. for J. on the Admin. Rec. (“Pl.’s MJAR”) (ECF No. 20); Def.’s

Cross-Mot. for J. on the Admin. Rec. (“Def.’s MJAR”) (ECF No. 26). Also pending is

plaintiff’s motion for preliminary and permanent injunctive relief. (ECF No. 13).




1
  NAICS code 541715 titled, “Research and Development in the Physical, Engineering, and Life
Sciences (except Nanotechnology and Biotechnology” provides “This U.S. industry
compromises establishments primarily engaged in conducting research and experimental
development (except nanotechnology and biotechnology research and experimental
development) in the physical, engineering, and life sciences, such as agriculture, electronics,
environmental, biology, botany, computers, chemistry, food, fisheries, forests, geology, health,
mathematics, medicine, oceanography, pharmacy, physics, veterinary and other allied subjects.”
NAICS Manual 2017 at 476. The NAICS code includes a special provision, Footnote 11(d),
which states that “research and development for guided missiles and space vehicles includes
‘evaluations and simulations, and other services requiring thorough knowledge of missiles and
spacecraft.” MDA relied on this provision in assigning NAICS code 541715 to this procurement.
2
  NAICS code 541513 titled “Computer Facilities Management Services” provides “This U.S.
industry comprises establishments primarily engaged in providing on-site management and
operation of clients’ computer systems and/or data processing facilities. Establishments
providing computer systems or data processing facilities support services are included in this
industry.” NAICS Manual 2017 at 470.
                                                2
       For the reasons discussed below, the court GRANTS the government’s cross-

motion for judgment on the administrative record and DENIES ACEs’ motion for

judgment on the administrative record together with its motion for injunctive relief.

I.     FACTUAL BACKGROUND

       On September 10, 2018, MDA issued the Solicitation seeking a contractor to

support the “Advanced Research Center (“ARC”) facility at Redstone Arsenal, located in

Huntsville, Alabama. AR 3878. This procurement will result in the award of one five-

year contract with three one-year and one half-year options. The estimated value is $308

million. AR 3743. The Solicitation has been set aside for Woman-Owned Small

Businesses and the NAICS code 541715, Research and Development in the Physical,

Engineering Life Sciences has a size standard of 1,250 employees. AR 1354, 3878.

       A. Background

       ARC is a contractor-owned General Service Administration (“GSA”) leased

Research, Development, Test and Evaluation (“RDT&E”) facility designed and operated

to support Ballistic Missile Defense System (“BMDS”)3 Hardware-in-the-Loop

(“HWIL”) Ground Test (“GT”) and Flight Test (“FT”) activities.” AR 3349. ARC’s

Mission is to perform network/infrastructure design, to house and maintain the BMDS

guided missiles and space tactical hardware and software, to maintain cybersecurity


3
 BMDS is an integrated, layered architecture that provides multiple opportunities to destroy
missiles and their warheads before they can reach their targets. Specifically, it “comprises space-
based sensors, ground- and sea-based radars, ground-and sea-based interceptor missiles, and a
command and control system[.]” MDA Faces Challenges in BMDS Concurrency and Integration
Reporting, 57 No. 19 Gov’t Contracts ¶ 147 (May 13, 2015).

                                                 3
compliance, and to perform lab asset management to realistically emulate/simulate the

complex weapon systems of the BMDS in support of BMDS Ground Testing and BMDS

Flight Test Risk Reduction Activities. Id. Under this Solicitation, the systems will be

expanded to include new sensors and tactical systems requiring ARC system design and

development activities to integrate new programs into the BMDS. Id.

       MDA is also transitioning to a new ground test concept that includes Continuous

Integration and Continuous Agile Testing (“CI/CAT”). AR 3879. Continuous Integration

(“CI”) testing includes Continuous Development Integration (“CDI”) and Continuous

System Integration (“CSI”) testing. As a result of CDI objectives, the contractor selected

under the Solicitation will need to develop new processes and tools to respond to changes

driven by CDI. This will include network design and expansion as well as installation and

integration of Software/Hardware updates provided by elements as a result of CDI

discoveries. AR 3880. Testing will be managed via a Resource Management Cell and this

contract. Id.

       MDA is also beginning the design and development of the new Combined Test

Center (“CTC”) facility to house the Missile Defense Data Center, the ARC, and related

test assets. Id. Under this Solicitation, the selected contractor will participate in the

system design activities to implement improvements that contribute to CI/CAT, asset

management, and data flow across all MDA systems housed in the CTC. Id.

       Because the Solicitation is designed to take on many improvements, developing

the Solicitation involved a lengthy process which is summarized below.



                                               4
       B. Pre-Solicitation Market Research and Industry Day

       In March and April 2016, MDA conducted market research related to the subject

Solicitation. AR 19. MDA sent a Request for Information (“RFI”) inviting contractors

that could “assume all Research, Test and Evaluation, and Operation and Maintenance

Functions” which included “in-progress tests, experiments, exercises, war-games and

other customer programs as well as upgrade and modernization tasks involving facility,

hardware, and software efforts” to submit a statement of capabilities. AR 1-2. MDA

indicated that “capability statements will be separate from, and have no bearing on,

submissions in response to any future Request for Proposal[.]” AR 3. The statement of

capabilities was to include a description of the contractor’s technical abilities, including

network design capabilities. AR 12.

       On January 12, 2017, MDA produced its first Market Research Report. AR 18-19.

The January Report stated, regarding the selection of a NAICS code that “[o]ut of the 11

potential sources, 8 sources agreed 541712 [now 54715- the code at issue] was

appropriate for this effort.” Id. Two sources believed NAICS code 541513 was

appropriate. Id.

       On May 8, 2017, MDA invited prospective contractors to the ARC facility. AR

27. That same day, MDA requested industry input on its draft statement of proposed

work (“PWS”) and Technical Library content. AR 31. Thereafter, on June 30, 2017,

MDA issued its second Market Research Report. AR 72. In the June Report, MDA

announced the selection of NAICS code 541715. AR 74.



                                              5
       The third and final Market Research Report was issued on December 8, 2017. AR

162. The December Report focused on MDA’s Organizational Conflict of Interest

(“OCI”) Policy. AR 163. The Report concluded that “absolute OCI restrictions should

only be applied” in limited circumstances and “[a]ll other OCI concerns should be

addressed under normal Agency OCI policy review procedures[.]” AR 165.

       C. Draft Solicitations, OCI Schedule, and Questions and Answers

       On March 13, 2018, MDA issued the Draft Request for Proposals (“DRFP”). AR

205. Of significance here, the March RFP indicated that past performance “evaluation

will result in a Performance Confidence Assessment” that included five rating categories:

“Substantial Confidence,” “Satisfactory Confidence,” “Neutral Confidence,” “Limited

Confidence,” and “No Confidence.” AR 732, 734. The DRFP indicated that for offerors

“without a record of relevant past performance or for whom information on past

performance is not available . . . the offeror may not be evaluated favorably or

unfavorably on past performance” and “shall be determined to have ‘Neutral

Confidence[.]’” AR 734. It further stated that “a record of ‘Substantial’ or ‘Satisfactory’

Confidence will be considered more advantageous to the Government than a record of

‘Neutral Confidence.’” Id. Past performance was part of the tradeoff analysis. AR 728.

       On April 4, 2018, MDA released another DRFP. AR 745-48. The April DRFP

indicated that “[i]f an offeror believes that the requirements in these instructions contain

an error, omission, ambiguity, or are otherwise unsound, the offeror shall immediately

notify the PCO in writing with supporting rationale no later than five (5) days after the

release of this solicitation.” AR 1192. The April DRFP further indicated that regarding

                                              6
past performance, “the Government will conduct an assessment of the offerors’, Team

Members’, and Major Subcontractors’ Past Performance.” AR 1289. It also stated that

past performance would now be evaluated either acceptable or unacceptable where

acceptable meant that “the Government has a reasonable expectation that the offeror will

successfully perform the required effort, or the offeror’s performance record is

unknown.” AR 1286. The DRFP stated that offerors with no relevant past performance

will “be determined to have an unknown past performance” and that an “unknown”

determination is considered “acceptable.” Id.

       On May 21, 2018, the Independent Government Estimate (“IGE”) and Technical

teams evaluated the performance work statement in the DRFP. AR 1351. Part of the

evaluation included considering which NAICS codes should apply to various Contract

Line Item Numbers (“CLINS”). Id. Eventually, the IGE and Technical teams concluded

that NAICS code 541715 was appropriate. Id. The evaluators considered the following

NAICS codes: 541513 for “Computer Facilities Management,” 541330 for “Engineering

Services Military and Aerospace Equipment and Military Weapons,” 518210 for “Data

Processing, Hosting, and related Services,” and 519190 for “All Other Information

Services.” AR 1355. The evaluators concluded that NAICS code 541715 was appropriate

because 41% of the work was under CLIN 006 which called for Network Design and fit

under NAICS code 541715. AR 1351, 1356. The IGE team concluded that NAICS code

541513 accounted for 17% of the work. AR 1356.

       On July 10, 2018, MDA posted its second round of questions and answers. AR

1367. Although ACEs submitted a question regarding the selection of NAICS code

                                             7
541715, MDA did not answer the question. AR 1369. As the below-quoted text of the

question makes clear, ACEs did not ask for an alternative NAICS code designation:

             Although the Agency may perform RDT&E [research and development,
             testing and evaluation] activities in the ARC facility, those activities appear
             to be performed on other contract vehicles. The work to be performed on
             the ARC contract, as described in the Agency’s draft PWS, is clearly to
             operate and maintain an environment to support testing, not to perform the
             actual test or analysis activities. The NAICS code for this procurement
             currently is listed as 541715, which applies to “Research and Development
             in the Physical, Engineering and Life Sciences (except Nanotechnology and
             Biotechnology).” The currently selected NAICS code for the procurement
             does not appear to be appropriate for this procurement for several reasons.
             Please describe the Agency’s rational for NAICs selection as it relates to
             each of the following:

             -Reference: Draft RFP Sec. K. According to the PWS, the principal purpose
             of the contract is not to conduct research and development but to “support
             the management of the Special Purpose Processing Node, Unclassified
             Networks, and other Government Furnished Equipment compromising the
             ARC, providing the infrastructure necessary to support Hardware-in-the-
             Loop Ground Test and tenant/stakeholder activities as part of the SPPN.”

             -Reference: Draft RFP Sec. K. GAO decided recently in ASM Research, B-
             412187 (Jan. 7, 2016) a firm maintaining a test environment is precluded
             from conducting testing in that environment because it presents an
             organizational conflict of interest. Because the contractor will be precluded
             from performing any research and development in the ARC, the NAICS
             code designated on the RFP is inapplicable.

             -Reference: Draft RFP Sec. K. The NAICS code for this procurement
             currently is listed as 541715, which applies to “Research and [sic]

Id. While MDA listed the question, MDA never responded to ACEs’ question regarding

the selection of NAICS code 541715.

      D. Final Solicitation and Amendments

      On September 10, 2018, MDA posted the Final Solicitation. AR 1539. Four days

later, MDA posted the first amendment to the Solicitation. AR 2103. The final

                                            8
Solicitation was posted on October 17, 2018. AR 3265. The deadline for submissions was

October 25, 2018 at 16:00 central time, and offerors were required to “confirm their

delivery date and time with the Contracting Officer . . . by 16:00 central time, October

22, 2018.” AR 3221.

       For purposes of this bid protest, the relevant information in the Solicitation

pertaining to the NAICS code selected and the past performance evaluation criteria are

described separately.

              1. Described Work in the PWS

       The Solicitation includes a PWS that showed what type of work would be required

and under which CLIN the work was categorized. AR 3250-3371. In total, there are six

CLIN categories. The court draws from OHA’s thorough descriptions of these CLIN

categories.

       CLIN 001 is titled Contract and ARC Management. Under CLIN 001, the

contractor shall manage and maintain cost, schedule, performance, risk, subcontracts,

vendors, test assets and associated maintenance agreements, infrastructure, and data to

sustain ARC operations. AR 3880 (citing PWS § 3.1(a)). The contractor shall maintain a

Program Management Plan that details the complete structure of contractor support, shall

participate in facility expansion or modification planning meetings to ensure coordination

with ARC long-range planning, testing activities, security requirements, and MDA

guidance. Id. (PWS § 3.1(a), (e)). The contractor shall monitor all ARC networks for

proper operation, throughput, quality of service, security compliance, and that

cybersecurity policies and guidelines are followed in all aspects of network operations

                                             9
and system administration. Id. (PWS § 3.2). The contractor shall develop a maintenance

plan for ARC test assets and obtain/maintain software licensing, and shall evaluate, test,

and integrate all software into the ARC networks. Id. (PWS § 3.3(a), (c)). The contractor

shall manage and operate a shipping and receiving department/property office to inspect

and verify deliveries, maintain property control records, and perform a quarterly

inventory audit. Id. (citing PWS § 3.3(e)). CLIN 001 accounts for 15 percent of the

estimated work. AR 1351.

       CLIN 002 is titled Network Management. Under CLIN 002, the contractor shall

maintain the schedule of all ARC activities/projects and a fully resource loaded

Integrated Master Schedule (“IMS”), conduct weekly IMS review meetings, facilitate

asset allocation, de-confliction, configuration management and test event certification,

and provide utilization and integration metrics. AR 3880-81 (citing PWS § 4.1). Also, the

contractor shall integrate ARC test asset schedules with the ARC Master Schedule, and

resolve conflicts between test asset requests, infrastructure needs, and facility

maintenance. AR 3881 (citing PWS § 4.1). The contractor shall maintain ARC

configuration files off-site, develop and execute documentation and procedures for IT

Contingency and Disaster Recovery (“DR”), and conduct quarterly DR tests. Id. (citing

PWS § 4.2).

       The contractor shall establish and maintain a centralized helpdesk and log of all

incidents and requests; establish incident management procedures for all facility,

software, hardware, and communications problems; and provide support services for

briefings and demonstrations. Id. (citing PWS § 4.3). Also, the contractor shall develop,

                                             10
implement, and maintain a Configuration Management Plan, maintain test asset data, and

operate software systems that record, reserve, and schedule ARC test assets. Id. (citing

PWS § 4.4). Regarding Special Purpose Processing Node (“SPPN”) Management, the

contractor shall plan, implement, and operate the ARC and provide utilization metrics on

all ARC test assets. Id. (citing PWS § 4.5(a), (e)). The contractor shall develop and

implement solutions to profile traffic flow to predict problems. Id. (citing PWS § 4.5(f)).

Also, the contractor shall evaluate new hardware and software technologies for ARC

networks, provide strategic planning, and recommend approaches in designing system

and network configurations, software/script development, power usage, and Reliability,

Availability and Maintainability engineering support in the development of new ARC

systems. Id. (citing PWS § 4.5(g)).

       The contractor shall provide network analysis and communications engineering

support for telecommunications and network systems, including the ARC side of remote

nodes and ARC based customers. Id. (citing PWS § 4.5(h)). The contractor shall support

Communications Security (“COMSEC”) maintenance and engineering activities for

BMDS test and evaluation networks. Id. (citing PWS § 4.5(i)). The contractor shall

collaborate to plan, document, and execute network communication interfaces between

ARC network infrastructure and other network infrastructures. Id. (citing PWS § 4.5(j)).

       The contractor shall manage IT infrastructure and networks comprised of

commercial and tactical systems to include asset allocation and de-confliction,

configuration management, and Integrated Master Schedule development, management,

and execution. Id. (citing PWS § 4.5(k)). The contractor shall manage network bandwidth

                                            11
allocation, and metrics monitoring utilization and downtime for all Laboratories, HWIL,

and formal ground test activities. Id. (citing PWS § 4.5(l)). The contractor shall develop

network diagrams for all ARC networks / enclaves, and perform OEM-recommended

preventive maintenance. Id. (citing PWS § 4.5(m), (n)). Also, the contractor shall develop

a Technology Refresh plan for the IT Infrastructure, taking into account synergies

derived from the CI/CAT, Combined Test Center design, and BMDS expansion

activities. Id. (citing PWS § 4.6). CLIN 002 accounts for 17% of the assigned work. AR

1351.

        CLIN 003 is titled Cybersecurity. The ARC handles Restricted Data and Critical

Nuclear Weapon Design Information on a daily basis when executing the requirements of

this contract. AR 3881. The contractor shall control access to information systems within

the ARC, and shall create, maintain and manage all BMDS test and evaluation assets and

infrastructure user accounts. Id. (citing PWS § 5.0). The contractor shall implement a

cybersecurity program for all classified and unclassified networks and will support a

broad-based capability of general cybersecurity services protection for the MDA ARC

test labs and assets such as hardware/software products, computer systems and

subsystems, and network and communications resources. AR 3881-82. (citing PWS

§ 5.01(a), (b)). Also, the contractor shall continually monitor all external/ internal traffic

and report monthly the health, status, and utilization of the network(s). AR 3882. (citing

PWS § 5.0(c)).

        The contractor shall monitor and comply with all instructions for Security

Technical Implementation Guides (STIGs). Id. (citing PWS § 5.1(a)). In addition, the

                                              12
contractor shall respond promptly and comply with MDA Cyber Tasking Orders (CTOs).

Id. (citing PWS § 5.1(a)). Weekly, the contractor shall perform a system wide analysis on

all IT systems and infrastructure to identify vulnerabilities and implement risk mitigation

recommendations. Id. (citing PWS § 5.1(b)). The Contractor shall safeguard and protect

Controlled Unclassified Information (“CUI”); develop and institute a training program

for ARC Contractor personnel, and monitor training and certification status of all

cybersecurity personnel. Id. (citing PWS § 5.1(e)).

       Further, the contractor shall develop and maintain security accreditation packages

for ARC Network and Infrastructure hardware, software and networks; support activities

required to maintain MDA system/enclave cybersecurity approvals; and also support

BMDS Element Accreditation activities. Id. (citing PWS § 5.1(f)). Also, the contractor

shall develop Risk Management Framework (“RMF”) packages and artifacts for

classified and unclassified networks, and shall develop, update, and execute the Concept

of Operations to include Cybersecurity, Information Assurance, and RMF. Id. (citing

PWS § 5.1(h), (i)).

       Under Security Management, the contractor shall continually demonstrate that it is

capable of protecting critical unclassified and classified information, and provide

personnel to support Government security personnel. Id. (citing PWS § 5.2(a)). The

contractor shall assist in the development and implementation of all day-to-day security

procedures including information security, physical security, COMSEC, and Operations

Security (OPSEC). Id. (citing PWS § 5.2(b)).



                                            13
       The contractor shall closely monitor changes to STIGs covering security

requirements, identify requirements not being met, and assist the government in

developing new processes and procedures as a result of updated or changed Accreditation

Authority guidance. Id. (citing PWS § 5.2(c)). Also, the contractor shall implement

modified processes and procedures to protect BMDS data and information at all times. Id.

(citing PWS § 5.2(c)).

       The contractor shall assist the Government to develop and incorporate OPSEC

guidance in day-to-day activities to mitigate security and program risks associated with

the collection and analysis of MDA information by adversaries, and actions against the

MDA mission and its personnel. Id. (citing PWS § 5.2(e)). The contractor shall

implement MDA policies and procedure to maintain compliance with all applicable

COMSEC guidance. Id. (citing PWS § 5.2(f)). The contractor shall design or procure,

incorporate and operate security resources required to support the security requirements

of ARC’s programs, projects and assets. Id. (citing PWS § 5.2(g)).

       The contractor shall implement practices to restrict unnecessary sharing and/or

flow of CUI down the entire supply chain based on need-to-know. Id. (citing PWS

§ 5.3(b)). The contractor shall develop an Information Management and Control Plan

(“IMCP”) that shall identify practices to restrict the unnecessary sharing and/or flow of

CUI, address procedures for reporting a cyber-incident, and document the process by

which System Security Plans and Plan of Action and Milestones are developed and

maintained to protect CUI within the contractor’s/subcontractor’s unclassified IT



                                            14
systems. AR 3882-83. (citing PWS § 5.3(c)). CLIN 3 accounts for 14% of the work. AR

1351.

        CLIN 004 is titled Test Support. The contractor shall facilitate test asset hardware

and software upgrades, design and implementation. AR 3883. (citing PWS § 6.1(a)). The

contractor shall develop and implement a configuration control process by which

lockdown is implemented prior to a test event and rescinded after completion. Id. (citing

PWS § 6.1(b)). The contractor shall provide infrastructure, network design and

configuration design to meet test event and training requirements and issue resolution in

support of Test, Integration Management, Test Execution Center (TEC) management, and

Advance Training Operational Center training exercises. Id. (citing PWS § 6.1(c)). The

contractor shall perform technical analysis to support design, development, integration,

execution, and analysis of experiments, test, and exercises, and demonstrations of

distributive software technology, real-time algorithms, and information assurance. Id.

(citing PWS § 6.1(d)). The contractor shall develop an automated system for test set-up

and related configuration control. Id. (citing PWS § 6.2). The contractor shall support the

test event certification process and ensure formal certification is received prior to test

execution. The contractor shall develop Certification Data Packages of ARC assets to

support formal ground tests. Id. (citing PWS § 6.3).

        The contractor shall support BMDS Integration and Development testing in the

TECs and ARC test assets; this includes risk reduction, software checkout, keep alive

runs, and other non-IMTP events. Id. (citing PWS § 6.4(a)). The contractor shall provide

video projection engineering and support for test execution and operator control rooms

                                              15
requiring situational awareness and visualization during IMTP testing or BMDS test and

execution element checkouts. Id. (citing PWS § 6.4(a)). The contractor shall configure

Test Support System equipment to allow routing of situational awareness screens to the

TECs. Id. (citing PWS § 6.4(b)). The contractor shall provide personnel to integrate

Ground Based Midcourse (GM) defense and Sensor (SN) assets, act as test “conductor”,

and provide statistics on integration runs for GM and SN assets. Id. (citing PWS

§ 6.4(c)).

       The contractor shall collect data for MDA test events, provide storage, and

coordinate data collection. Id. (citing PWS § 6.5). The contractor shall design, develop

and execute network scripts or other software for data collection, storage, and eventual

dissemination of test data to the Missile Defense Data Center. Id. (citing PWS § 6.5).

CLIN 004 accounts for 12% of the work. AR 1351.

       CLIN 005 is titled Task Instructions – Real World Events. Performance under this

Task Instruction (TI) Contract CLIN will be in support of activities for “real world”

events such as analysis assigned to elements from external agencies to include Warfighter

Request for Analysis/Requests for Real World Events/Urgent Unknowns. The contractor

shall support any real world event identified by the Government and perform by

reprioritizing work and adjusting work schedules to ensure mission success. AR 3883

(citing PWS § 7.0).

       CLIN 006 is titled Network Design. Performance under this CLIN includes

research and development engineering activities. AR 3884. (citing PWS § 8.0). The

contractor shall develop network scripts and new software tools. Software development

                                            16
includes designing, developing and implementing solutions to support CI/CAT through

Rapid Reconfiguration of System Test Architectures; automated health and status tools

compatible with the HWIL GT environment; and Independent Verification & Validation

(IV&V) processes, systems, software or hardware to support the acceptance and

integration of new BMDS elements into the ARC infrastructure. Id. (citing PWS

§ 8.1(a)). New elements could include additional HWIL assets, or new BMDS

representation/HWIL assets such as new sensors, interceptors, and systems such as

Patriot and Integrated Air and Missile Defense (IAMD). Id. (citing PWS § 8.1(a)).

      The contractor shall design, develop and prepare an Analysis of Alternatives

(“AoA”) for Hardware and Software solutions for rapid reconfiguration to support

improvements in system reconfiguration and Configuration Management necessary to

support Agile Testing (Continuous Integration/Continuous Agile Testing). Id. (citing

PWS § 8.2(a)). The contractor shall re-design network architecture to support increased

data transmission for CI/CAT. Id. (citing PWS § 8.2(b)). The contractor shall design,

develop and prepare an AoA to implement automated Health and Status and

Configuration Control to tactical HWIL systems. Id. (citing PWS § 8.3). The contractor

shall design, develop and prepare an IV&V suite of tools to support integration and

acceptance of new BMDS assets delivered to the ARC. Id. (citing PWS § 8.4).

      Under Network Design, the contractor shall design and implement a network

engineering, management, and monitoring capability that encompasses all unclassified

and classified networks in the ARC. Id. (citing PWS § 8.5(a)). The contractor shall

design, develop and implement network designs in support of HWIL, test lab emulation,

                                           17
and cybersecurity. Id. (citing PWS § 8.5(b)). Network Design activities also include

expansion and/or changes to existing network designs to: incorporate hardware and

software solutions to integrate additional BMDS systems into the ARC infrastructure;

incorporate new BMDS systems such as LRDR and HDR into BMDS representation;

update the BMDS Independent and Development Lab (“BID Lab”) Architecture for

inclusion of CI/CAT-related CDI; incorporate into the ARC architecture new BMDS

design solutions to support Hypersonic Glide Vehicle, UAV platform, and Advance

Tactical Aircraft; design and develop system architecture re-designs to support the

Combined Test Center (CTC); and design and update the HWIL architecture to include

existing BMDS assets such as IAMD and Patriot. Id. (citing PWS § 8.5(b)). As discussed

above, CLIN 006 accounts for 41% of the contract work. AR 3884.

              2. Past Performance Evaluation

       The past performance evaluation criteria in the third amended Solicitation are the

same as those found in the April DRFP. The Solicitation provides that MDA will

evaluate past performance for recency, relevancy, and quality. AR 3259-60. The

relevancy assessment will measure “the extent of similarity between the service/support

effort, complexity, dollar value, contract type, and subcontract/teaming” and the “scope

and magnitude of effort and complexities this solicitation requires.” AR 3260. After this

review, the offeror’s past performance will be rated either “acceptable” or

“unacceptable.” AR 3256, 3259. Acceptable is defined as “[b]ased on the offeror’s

performance record, the Government has a reasonable expectation that the offeror will

successfully perform the required effort, or the offeror’s performance record is

                                            18
unknown.” AR 3256. Unacceptable is defined as “[b]ased on the offeror’s performance

record, the Government has no reasonable expectation that the offeror will successfully

perform the required effort.” Id. Additionally, the Solicitation included a note that said

“[i]n the case of an offeror without a record of relevant past performance or for whom

information on past performance is not available or so sparse that no meaningful past

performance rating can be reasonably assigned, the offeror may not be evaluated

favorably or unfavorably on past performance (see FAR 15.305 (a)(2)(iv)[.]” Id. The

Solicitation states that offerors with “unknown past performance,” in the context of

Acceptability / Unacceptability, “shall be considered ‘Acceptable.’” Id.

       Past performance was Factor 3 in the final Solicitation’s list of evaluation factors.

AR 3255. Furthermore, the final Solicitation stated, as it had in the April DRFP, that the

“selection decision will document tradeoffs between Factors 4, 5, and 6 in the

competitive range [for those offerors receiving] receiving an acceptable rating for Factors

1-3.” Id. Thus, past performance was not a tradeoff criteria.

       E. ACEs’ Protest Before OHA

       ACEs filed a protest on September 11, 2018 before the SBA’s Office of Hearings

and Appeals (OHA) contesting MDA’s selection of NAICS code 541715. AR 3828. On

September 12, 2018, OHA issued an order in response to ACEs’ protest. AR 3838.4 In

that order, OHA asked the Contracting Officer (“CO”) to “[n]otify OHA of any


4
 The facts surrounding OHA’s procedure are relevant here because ACEs alleges that this court
should set OHA’s decision aside and remand the case back to OHA because OHA violated its
own procedures by considering an amendment to the Solicitation made after the close of record
date.
                                             19
additional amendments to the solicitation, any contract award, or any other litigation

affecting this procurement, while this appeal is pending.” AR 3839. OHA closed the

record on September 27, 2018, AR 3840, and thereafter on October 28, 2018, issued its

decision upholding the MDA’s selection of NAICS code 541715. AR 3847. OHA relied

on a version of the Solicitation amended on October 16, 2018 in its analysis. AR 3879.

The changes to the Solicitation were:

   1. “Urgent, Non-Test, Network down reporting: 4 hours” was removed from Section

4.3.1(e)(2).

   2. Section 5.2, subsections (a)-(d), of the original PWS were replaced with Section

5.2, subsections (a)-(g), in the revised (Rev 01) PWS.

   3. Section 5.2, subsections (e), (f), and (g), of the original PWS were moved to

Section 5.0, subsections (a), (b), and (c), of the Rev 01 PWS.

   4. In Section 5.3(d)(6), “1000 business days” was changed to “45 business days.”

   5. In Section 5.3(f), the citation “sections 3a-e” was changed to “sections 5.3(c)1-5.”

   6. In Sections 9 and 11, a parenthesis was added in the header to reflect the CLIN

numbers.

   7. Section 12.0(c) and the “Staffing Requirements” table were updated to number the

key personnel for clarity.

       The October 16, 2018 changed none of the substance in Section I.D.1 above. Out

of the above changes, OHA only relied on Section five where subsections were moved

around. The following is an outline of the relevant portions of OHA’s decision.

               1. Description of ACEs’ Arguments

                                            20
      OHA explained that ACEs “contends that NAICS code 541715 is inappropriate

for this RFP because this is not a research and development procurement” and that ACEs

“urges OHA to conclude NAICS code 541513, Computer Facilities Management

Services, with a $27.5 million annual receipts size standard, is the appropriate NAICS

code” for the Solicitation. AR 3885. OHA further stated that ACEs argued “that contracts

to support or assist a research organization cannot be automatically deemed to be

research and development procurements.” Id. ACEs cited several previous OHA

decisions to show that OHA rejects using NAICS code 541715 for contracts that support

for agency research and development. Id. (citing Size Appeal of Professional Project

Services, Inc., SBA No. SIZ-5411 (2012); NAICS Appeal of Bevilacqua Research Corp.,

SBA No. NAICS-5243 (2011); NAICS Appeal of Information Ventures, Inc., SBA No.

NAICS-4953 (2008)).

      In particular, ACEs argued that CLIN 006, which “is the single largest CLIN,

making up 41% of the Full Time Equivalents (FTE) for the instant procurement,”

includes required tasks which “are not research and development, but design and

implementation of hardware and software solutions that support MDA.” Id. Therefore,

OHA explained, ACEs argued that because both research and development were required

for MDA to assign NAICS code 541715, MDA’s decision was clearly erroneous. Id.

(citing NAICS Appeal of Dayton T. Brown, Inc., SBA No. NAICS-5164, 2010 WL

9012920 (2010)).

             2. Relevant Definitions



                                           21
       OHA laid out the definitions of NAICS Code 541715, 541513, and the general

definition of research from the NAICS Manual. OHA stated that NAICS code 541715

covers: “establishments primarily engaged in conducting research and experimental

development (except nanotechnology and biotechnology research and experimental

development) in the physical, engineering, and life sciences, such as agriculture,

electronics, environmental, biology, botany, computers, chemistry, food, fisheries,

forests, geology, health, mathematics, medicine, oceanography, pharmacy, physics,

veterinary and other allied subjects.” AR 3888-89. OHA explained that research is

defined as “original investigation undertaken on a systematic basis to gain new

knowledge”, and “experimental development” as “the application of research findings or

other scientific knowledge for the creation of new or significantly improved products or

processes[.]” AR 3889. OHA explained that NAICS code 541513 includes

“establishments primarily engaged in providing on-site management and operation of

clients’ computer systems and/or data processing facilities. Establishments providing

computer systems or data processing facilities support services are included in this

industry.” Id.

       Additionally, OHA considered the footnotes to NAICS code 541715. OHA

explained that Footnote 11(a) for NAICS code 541715 states that research and

development “means laboratory or other physical research and development. It does not

include economic, educational, engineering, operations, systems, or other nonphysical

research; or computer programming, data processing, commercial and/or medical

laboratory testing.” Id. And OHA then said that Footnote 11(d) states that research and

                                            22
development “for guided missiles and space vehicles includes evaluations and simulation,

and other services requiring thorough knowledge of complete missiles and spacecraft.”

Id.




              3. OHA’s Analysis

       OHA began by acknowledging that “OHA has long held that procurements

classified under a research and development NAICS code ‘must be for research and

development, and thus must look to creating new processes or products.’” AR 3890

(citing NAICS Appeal of Dayton T. Brown, Inc., SBA No. NAICS-5164, 2010 WL

9012920, at *5 (Nov. 8, 2010)). OHA then went on to explain that a special rule applies

with regard to guided missiles and space vehicles, stating that in “Footnote 11(d), the

regulation provides that research and development for guided missiles and space vehicles

includes ‘evaluations and simulations, and other services requiring thorough knowledge

of missiles and spacecraft.’” Id. Based on this provision, OHA explained that a research

and development procurement involving missiles and spacecraft “is therefore not as strict

as it is in other disciplines.” Id. (referencing NAICS Appeal of Millennium Eng’g and

Integration Co., SBA No. NAICS-5309, 2011 WL 6183624, at *11-12 (Dec. 12, 2011)).

OHA concluded that “an RFP which requires evaluations and simulations involving

missiles and similar devices, as well as a thorough knowledge of these technologies, may

be designated under the NAICS 541715, under the Guided Missiles and Space Vehicles



                                            23
exception.” Id. (citing NAICS Appeal of DCS Corp., SBA No. NAICS-5703, 2016 WL

270949, at *4 (Jan. 6, 2016)).

       Tested by these standards, OHA explained that “this RFP explicitly requires

services involving evaluations and simulation of missiles, requiring a thorough

knowledge of missiles, and thus fits into the description of the NAICS exception in

Footnote 11(d).” AR 3891. In this connection, OHA stated that “BMDS is an

extraordinarily complicated and sophisticated undertaking, compared to ‘hitting a bullet

with a bullet.’ The lab assets include the hardware and software necessary for guided

missiles and space vehicles. This contract will expand these systems to include new

sensors and tactical systems ARC designs, and development to integrate new programs

into BMDS.” AR 3890. OHA further stated that the “contractor will be servicing the

necessary modeling and simulation equipment.” AR 3890-91. OHA concluded that

because a thorough knowledge of BMDS is required to perform this contract, the

Solicitation “explicitly requires services involving evaluations and simulation of missiles,

requiring a thorough knowledge of missiles, and thus fits into the description of the

NAICS exception in Footnote 11(d).” AR 3891.

       Then, OHA discussed the work OHA relied on to conclude that the Solicitation

required evaluations, simulations, and other services requiring a thorough knowledge of

missiles. First, and foremost, OHA concluded that CLIN 006 on network design, called

for research and development. AR 3891. OHA stated that the “contractor is required to

develop new tools and processes to respond to changes required by the results of testing”

and that the “contractor will participate in the system design activities to implement

                                            24
improvements to CI/CAT, asset management and all of MDA’s data flow.” Id. OHA

specifically concluded that under CLIN 006, the “contractor’s work will include original

investigation, or research, to obtain necessary knowledge to develop the AoA for

hardware and software solutions necessary to support the CI/CAT.” Id. OHA stated that

CLIN 006 “represents the largest portion of this contract” because it represents 41% of

the work and “includes research and development of the software which will be an

integral part of the essential simulations to support the BMDS.” Id. Therefore, OHA

concluded, “the CO was correct in characterizing this CLIN as research and

development.” Id.

       OHA further noted that CLIN 004 expressly calls for research and development.

AR 3891. OHA stated that under CLIN 004 the contractor is required “to collect data for

MDA test events” and “[t]his constitutes original investigation, or research, and is

necessary for the support of MDA.” Id. With regard to Footnote 11(d), OHA stated that

“[t]he contractor must further use this research to develop software and systems to

support the tests and simulations for BMDS.” Id.

       Finally, OHA relied on CLIN 003 regarding cybersecurity, stating that CLIN 003,

“supports a research and development designation.” Id. OHA explained that CLIN 003

requires the contractor “to implement a cybersecurity program for all the networks” and

“develop new processes and procedures” to address the cybersecurity requirements. Id.

OHA further stated that “once investigated and created, new cyber tools, standards,

processes and method must be continually refined, tested and improved.” Id. OHA cited a

previous OHA decision where OHA “found that a procurement for cyber warfighting

                                            25
capabilities was properly designated as a Research and Development procurement,

because the new cyber tools must be created in the first instance, even if the procurement

did not specifically call for laboratory research.” Id. (citing NAICS Appeal of Tech. Sec.

Assoc., Inc., SBA No. NAICS-5950, 2018 WL 6113389, at *12 (Aug. 13. 2018)).

Overall, OHA concluded that “this RFP requires the contractor to engage in original

investigation, or research to obtain the necessary knowledge to develop the software and

hardware to support the testing and simulation of the BMDS program, and it requires the

contractor to have a thorough knowledge of the program to perform the procurement.”

AR 3891.

       Having concluded that ACEs had not established that NAICS code 541715 was

clearly erroneous for this RFP, OHA stated that “it is unnecessary to consider the NAICS

code [ACEs] advocates.” AR 3892. OHA explained that “OHA will not assign a different

NAICS code to a procurement unless the CO’s NAICS code classification is shown to be

clearly erroneous.” Id. (citing NAICS Appeal of Tech. Sec. Assoc., Inc. SBA No. NAICS-

5950, at *14 (2018)).

II.    PROCEDURAL HISTORY

       On October 24, 2018, the day before proposals were due on the Solicitation, ACEs

submitted a complaint in this court requesting a temporary restraining order, preliminary

injunction, permanent injunction, and declaratory judgment with regard to both the

Solicitation’s designation of NAICS code 541715 and the Solicitation’s evaluation

criteria for past performance. Compl. ¶ 1 (ECF No. 1). ACEs also filed motions for a

temporary restraining order and permanent injunction that same day. (ECF Nos. 2,3).

                                            26
Later that day, OHA released its decision affirming MDA’s designation of NAICS code

541715 for this Solicitation. AR 3878. ACEs did not submit a proposal.

       The following day, October 25, 2018, this court denied ACEs’ motion for a

temporary restraining order. (ECF No. 9). The court reasoned that “because proposals

have to be submitted in person on October 25, 2018, the court finds that the request for a

TRO filed one day before proposals were due is untimely and further that the issuance of

a TRO would greatly prejudice both the government and potential offerors that have

submitted or have committed to submit proposals on the due date set forth in the

solicitation.” Id.

       On October 31, 2018, ACEs submitted an amended complaint challenging OHA’s

decision. Amend. Compl. (ECF No. 12). That same day, ACEs filed a renewed motion

for a preliminary and permanent injunction. Pl.’s Renewed Mot. (ECF No. 13). The

government filed the administrative record on November 5, 2018. (ECF No. 17). On

November 19, 2018, ACEs filed its motion for judgment on the administrative record and

on November 19, 2018, the government filed its cross-motion for judgment on the

administrative record. (ECF Nos. 20, 26). Briefing was completed on December 14,

2018. Oral argument was February 5, 2019. (ECF No. 36).

III.   SUBJECT MATTER JURISDICTION AND STANDING

       Before turning to the merits of ACEs’ complaint, the court must first “‘satisfy

itself that it has jurisdiction to hear and decide a case.’” Hardie v. United States, 367 F.3d

1288, 1290 (Fed. Cir. 2004) (quoting PIN/NIP, Inc. v. Platte Chem. Co., 304 F.3d 1235,

1241 (Fed. Cir. 2002)); see Remote Diagnostic Techs., LLC v. United States, 133 Fed. Cl.

                                             27
198, 202 (2017) (citing Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 94 (1998))

(“Jurisdiction is a threshold matter that must be resolved before the Court can take action

on the merits.”)). The court has jurisdiction under 28 U.S.C. § 1491(b)(1) to “render

judgment on an action by an interested party objecting to . . . any alleged violation of

statute or regulation in connection with a procurement or proposed procurement.”

       Because standing is a jurisdictional question, the court must also “determine

whether [the] plaintiff has standing before it can proceed to a decision on the merits.”

Remote Diagnostic Techs., LLC, 133 Fed. Cl. at 202. The protestor, as the party invoking

this court’s jurisdiction, “bears the burden of establishing [standing], and must ultimately

do so by a preponderance of the evidence.” RMGS, Inc. v. United States, 140 Fed. Cl.

728, 737 (2018) (citing Reynolds v. Army & Air Force Exch. Serv., 846 F.2d 746, 748

(Fed. Cir. 1988) and Rocovich v. United States, 933 F.2d 991, 993 (Fed. Cir. 1991)). “[A]

plaintiff must demonstrate standing for each claim he seeks to press[.]” Davis v. Federal

Election Com’n, 554 U.S. 724, 734 (2008) (quoting Daimler Chrysler Corp. v. Cuno, 547

U.S. 332, 352 (2006)).

       Importantly, standing under Section 1491(b)(1) “imposes more stringent standing

requirements than Article III.” Weeks Marine, Inc. v. United States, 575 F.3d 1352, 1359

(Fed. Cir. 2009) (citation omitted). “To demonstrate standing under 28 U.S.C.

§ 1491(b)(1), a plaintiff must show that it is an ‘interested party’ who suffered prejudice

from a significant procurement error.” Thomas-Sea Marine Constructors, LLC v. United

States, 141 Fed. Cl. 185, 209 (2018) (citing CliniComp Int’l, Inc. v. United States, 904

F.3d 1353, 1358 (Fed. Cir. 2018)). In order to be an interested party, the protestor must

                                             28
first show that it was an “actual or prospective bidder.” Digitalis Educ. Sols, Inc. v.

United States, 664 F.3d 1380, 1384 (Fed. Cir. 2012).5 Second, the protestor must show

that it has a “direct economic interest” in the contract. Id. Where a “prospective bidder

challenges the terms of the solicitation itself . . . the protestor can establish standing by

demonstrating that it suffered a ‘non-trivial competitive injury which can be redressed by

judicial relief.’” Orion Tech., Inc. v. United States, 704 F.3d 1344, 1348 (Fed. Cir. 2013)

(quoting Weeks Marine, Inc., 575 F.3d at 1361-62). The Federal Circuit has recently held

that “to suffer a non-trivial competitive injury, [the protestor] must at least be qualified to

compete for the contract it seeks.” CliniComp, Int’l, Inc. v. United States, 904 F.3d 1353,

1360 (Fed. Cir. 2018).6

       Here, the government argues in its cross-motion for judgment on the

administrative record that this protest must be dismissed because ACEs has not shown




5
  Where the protestor has failed to submit a proposal by the deadline, the protestor can still
become a “prospective bidder” if the protestor submits a timely protest and is “expecting to
submit an offer prior to the closing date of the solicitation.” Rex Serv. Corp. v. United States, 448
F.3d 1305, 1308 (Fed. Cir. 2008) (quoting MCI Telecommunications Corp. v. United States, 978
F.2d 362, 365 (Fed. Cir. 1989). “[T]he opportunity to become a prospective bidder ends when
the proposal period ends.” Digitalis Educ. Sols., Inc., 664 F.3d at 1385 (citation omitted).
Additionally, the Federal Circuit has clarified that in addition to filing a timely protest, the
protestor may only be considered a “prospective bidder” if it continues “to pursue its right in a
diligent fashion.” CGI Fed. Inc. v. United States, 779 F.3d 1346, 1350-51 (Fed. Cir. 2015).
6
  Standing also requires a protestor to show that it “was prejudiced by a significant error in the
procurement process.” CliniComp Int’l, Inc., 904 F.3d at 1358. “Although the inquiries may be
similar, prejudice must be shown either as part of, or in addition to, showing a direct economic
interest.” Id. Just as a protestor must demonstrate that it is an interested party, so too must the
protestor establish standing before the court can address the merits. Info. Tech. & Applications
Corp. v. United States, 316 F.3d 1312, 1319 (Fed. Cir. 2003) (“In fact, because the question of
prejudice goes directly to the question of standing, the prejudice issue must be reached before
addressing the merits.”).
                                                 29
that it has standing to bring this protest. According to the government ACEs has not

demonstrated that it is qualified to compete for this procurement and it therefore does not

have a direct economic interest in the subject procurement. Def.’s MJAR at 6-13. In

support of its standing argument, the government relies on the allegations in ACEs’

complaint, which the government argues are not sufficient to meet the minimum

requirements for award. In particular, the government argues that nowhere in its

complaint does ACEs allege that it has the network design capability described and

necessary to perform CLIN 006 or the cybersecurity background needed. In addition, the

government argues that the size of the contract to be awarded under the subject

Solicitation, which exceeds $300 million, is much greater than any contract ACEs has

ever received. Relying on uncontested data from the USASpending.gov, a webpage

which tracks contract awards, spending, and evaluations under those contracts, it appears

that within the last five years, ACEs has been awarded government contracts with a total

potential value of $20.1 million. Def.’s MJAR at Appx 10; Appx 12-116. ACEs’ largest

government contract award was for a one-year contract in 2010 for $13.8 million. Id. at

Appx 11-12. ACEs’ government contracts have mainly involved training and instruction,

customer service support, and other support services. Def.’s MJAR at Appx 13, 20, 27,

34, 41, 48, 55, 69, 76, 83. None of ACEs prior contracts were assigned NAICS code

541715.

       ACEs does not dispute the government’s factual assertions regarding standing but

argues that it is nonetheless a qualified bidder. First, ACEs argues that the government

did not challenge ACEs’ qualifications before OHA and has thus conceded it is qualified.

                                            30
Pl.’s Resp. at 3 (citing AR 3857). Second, ACEs contends that to the extent it does not

have in-house capabilities to meet the requirements of the Solicitation, ACEs can

accomplish certain requirements, including, cybersecurity requirements with off-the-shelf

products, Pl.’s MJAR at 40, and can meet any of the CLIN 006 requirements by hiring

subcontractors. Pl.’s Resp. at 4 (ECF No. 28). ACEs argues that with the off-the-shelf

products and subcontractors it can satisfy the capabilities identified by MDA, namely it

can assume of “all Research, Test and Evaluation, and Operation and Maintenance

Functions,” including “in-progress tests, experiments, exercises, war-games and other

customer programs as well as upgrade and modernization tasks involving facility,

hardware, and software efforts.” AR 1-2.

       The Federal Circuit in CliniComp Int’l, Inc. held that to demonstrate standing a

prospective contractor must be able to “demonstrate an ability to perform specific

requirements that are set forth in the administrative record.” 904 F.3d at 1360. In that

case involving a challenge to the government’s decision to negotiate a sole source

contract, the Federal Circuit examined whether CliniComp would be capable of

performing the work in the challenged contract. After reviewing the complaint and

evidence presented, the Federal Circuit measured CliniComp’s alleged qualifications

against the Determination and Findings which authorized the federal agency “to negotiate

a sole-source contract” with a particular company. Id. at 1356. The Federal Circuit

concluded that CliniComp’s alleged qualifications were not sufficient to meet the

government’s stated contract needs and thus CliniComp would not qualify for the

contract had it been open for competition. Id. at 1360. Specifically, in CliniComp Int’l

                                             31
Inc., the contract required outpatient services and the Circuit found that CliniComp had

not demonstrated its ability to perform outpatient services and thus by itself would not be

qualified. The Circuit also found that CliniComp could not satisfy the contract’s

requirements by alleging that it could partner with another contractor. The Circuit

explained that vague allegations regarding the ability to hire out services that it could not

perform were not sufficient to prove that the protestor was qualified. Id. at 1360-61. For

all of these reasons, the Circuit agreed with the trial court that the protestor was not

qualified to perform the necessary work and thus affirmed the dismissal for lack of

standing. Id.

        Tested by the CliniComp standards, the court finds that ACEs has not shown that

it could satisfy the specific requirements in the Solicitation and that its suggestion that it

could hire subcontractors to perform work is insufficient to establish standing.

       Here, the Solicitation explicitly calls for the contractor to perform network design.

Specifically, the Solicitation states:

                The contractor shall re-design network architecture to support increased
                data transmission for CI/CAT. . . .

                The contractor shall design and implement a network engineering,
                management, and monitoring capability that encompasses all unclassified
                and classified networks within the ARC. . . .

                The contractor shall design, develop and implement network designs in
                support of HWIL, test lab emulation and cybersecurity. These network
                design activities will include expansion and/or changes to existing network
                designs.

                These network design activities will include expansion and/or changes to
                existing network designs to . . . [i]ncorporate new BMDS systems such as
                LRDR and HDR into the complex BMDS representation at the ARC.

                                              32
AR 3367. Indeed, network design was subfactor 4 of the technical evaluation criteria. AR

3739.

        ACEs’ complaint provides no information regarding its ability to perform network

design and ACEs had not provided any additional evidence to contradict the

government’s assertion that ACEs is not capable of creating new network designs.

Rather, ACEs originally argued that it would be able to “utilize commercial off-the-shelf

products” to meet the network design requirements. See Pl.’s MJAR at 40. ACEs

clarified during oral argument that its statement regarding off-the-shelf products applied

to cybersecurity requirements. Oral Argument 14:37:50-14:38:08. ACEs now argues that

it would partner with subcontractors to meet the work requirements set forth in CLIN

006.

        Both arguments fail. First, to the extent ACEs still believes it could rely on off-

the-shelf products for network design the argument is unsupported. The Solicitation

clearly requires the contractor to “design, develop and implement network designs”

which will respond to expansions of the “new BMDS systems.” AR 3367. These are

requirements for “new processes and tools to respond to changes . . . to include network

design and expansion.” See AR 3880. Therefore, off-the-shelf products cannot satisfy

requirements for new products unique to the ARC.

        Second, ACEs claim that it could partner with subcontractors to meet CLIN 006

requirements, without more details, is not sufficient to establish that ACEs is qualified.

ACEs argues that it “routinely works with numerous other companies and could easily


                                              33
form a qualified team.” Pl.’s Resp. at 4. ACEs does not identify any such partner, nor

does it provide any details as to how this could be done. As noted above, the Federal

Circuit rejected a nearly identical argument in CliniComp Int’l Inc. 904 F.3d at 1360. The

Federal Circuit found that argument “unpersuasive” because the protestor had “not

supplied any details regarding how, or with whom, it would subcontract to perform what

is required.” Id. The Federal Circuit stated that the protestor’s “vague, cursory references

to using subcontractors to perform the work it is unable to do are insufficient” to

demonstrate standing. Id. at 1360-61. Here, ACEs’ statement that it can and routinely

does form partnerships is just as vague as the protestor’s statement that it could

subcontract work in CliniComp, Int’l Inc. ACEs provides no details regarding how or

with whom it would work to create a qualified team. Therefore, the court concludes that

where a solicitation contains extensive work in network design and the protestor

concedes it does not have the necessary qualifications and provides no facts to support

how it will complete that work has failed to demonstrate by a preponderance of the

evidence that it is a qualified bidder with standing.

       In addition to the foregoing issues with ACEs standing, the government also

argues that ACEs has not “demonstrated that it can perform a contract as large as the

ARC contract.” Def.’s MJAR at 8. This challenge to ACEs’ standing is again similar to

the standing challenge the protestor faced in CliniComp Int’l Inc. In that case, the

protestor “only had experience provid[ing] services at 100 facilities” and the contract

“would require comprehensive services . . . at 1,600 VA healthcare cites.” 904 F.3d at

1359. The Federal Circuit found the protestor’s inexperience with contracts the size of the

                                             34
one at issue was another reason why the protestor was not qualified to compete. Id at

1360.

        Here, the ARC contract is expected to reach $308 million in funding over the

course of five years, three one-year option periods, and one half-year option period. AR

3743. The contract is estimated to run from $38 to $42 million yearly. AR 204. ACEs

does not dispute the information from USASpending.gov, which shows that ACEs has

only been awarded contracts “with a total potential value of $20.1 million” and that its

largest contract has had a $13.8 million value. Def.’s MJAR at 9. In response, ACEs

argues, again, that it can handle a contract of the size at issue by partnering with other

organizations. As discussed above, ACEs’ argument, without more factual support, fails.

ACEs has not shown that it has the financial resources to perform the ARC contract.

Therefore, for this reason as well, ACEs does not have standing to bring its claims.7




7
  The government further argues that ACEs is not qualified to compete because ACEs failed to
submit necessary information and obtain necessary information to compete for the contract.
Def.’s MJAR at 9. In particular, the government argues that by failing to meet the October 22,
2018 deadline to confirm submitting proposals, the October 25, 2018 deadline to submit a
proposal, and the May 17, 2018 deadline to submit the OCI review forms, ACEs failed to show it
was qualified to compete for the contract. AR 2563 (submission deadline), 2653 (deadline to
confirm submitting proposal); AR 1343 (OCI review form request). The government argues that
ACEs failed to obtain necessary information by not accessing information necessary to submit a
bid until October 2, 2018 and not participating in industry day tours. Def.’s MJAR at Appx2 ¶ 6.
The government cites no legal authority in making these arguments. The court does not find the
government’s arguments persuasive. To extent that ACEs intended to protest the NAICS code
designation and compete if the contract were resolicited, ACEs alleges it would submit the
required documents. Additionally, attendance at industry day was not required to compete in the
contract, AR 29, and the court cannot find that accessing necessary information to compete for
the contract later than other offerors made ACEs unqualified to compete. Similarly, the
government conceded in oral argument that submission of OCI information was not a
requirement to compete for the contract. Oral Arg. 14:01:00-14:03:00.

                                              35
       For all of these reasons, the court finds that ACEs has failed to establish that it is

qualified for an award of the subject contract and has thus failed to establish an economic

harm sufficient to establish standing.

IV. MERITS DISCUSSION

       Although for the above-stated reasons the court finds that ACEs has failed to

establish standing, in the interest of judicial economy, the court will address the merits of

ACEs’ claims.8

       A. OHA’s Decision Is Supported

       ACEs argues that OHA’s decision to affirm MDA’s selection of NAICS code

541715 was arbitrary, capricious, an abuse of discretion, and not in accordance with the

law.9 First, ACEs argues that OHA abused its discretion by violating its procedures when

it considered a version of the Solicitation amended after OHA’s close of record date.

ACEs argues that OHA’s consideration of amendments made after the record was closed

violates 13 C.F.R. § 134.226 which states that the “record will constitute the exclusive



8
  Assuming as discussed above that ACEs does have standing, this court does have jurisdiction
over ACEs’ appeal of the OHA decision and challenge to the terms of the Solicitation under 28
U.S.C. § 1491(b)(1). See Palladian Partners, Inc. v. United States, 783 F.3d 1243, 1254 (Fed.
Cir. 2015). The standards of review under Section 1491(b)(1) are well settled. The court must
determine whether the agency decision “lacked a rational basis” or “involved a violation of
regulation or procedure.” Impresa Construzioni Geom. Domenico Garufi v. United States, 238
F.3d 1324, 1332 (Fed. Cir. 2001). With regard to alleged errors of law, a protestor must
demonstrate “a clear and prejudicial violation of applicable statutes or regulations.” Id. at 1333.
9
  While ACEs attempts to challenge MDA’s NAICS code decision separate from the OHA
decision, the challenge has no merit. See Pl.’s MJAR at 21. OHA has the “exclusive jurisdiction
to review the [CO’s] determination of the appropriate NAICS code designation.” Ceres Envtl.
Servs., Inc. v. United States, 52 Fed. Cl. 23, 33 (2002) (citing 13 C.F.R. § 121.1102)). Because
OHA is the final decision maker, the NAICS code challenge is limited to OHA’s appeal.
                                                36
basis for a decision,” and the decision should therefore be set aside. Second, ACEs argues

that OHA acted irrationally when affirming MDA’s NAICS code designation. ACEs

argues that NAICS code 541513 (“Computer Facilities Management Services”) with a

small-business size standard of $27.5 million was a more appropriate NAICS code for the

subject Solicitation. For the reasons discussed below, both of ACEs’ arguments are

without merit.

              1. OHA’s Consideration of October Amendments to the Solicitation

       ACEs claims that OHA “abused its discretion” by violating its regulatory

procedures when OHA considered the October 16, 2018 Solicitation amendments. Pl.’s

MJAR at 36-37. To support this argument, ACEs cites two regulations. First, ACEs cites

13 C.F.R. § 134.226 which states the “record will constitute the exclusive basis for a

decision.” Second, ACEs cites 13 C.F.R. § 134.225 which indicates that OHA “will set

the date upon which the pre-decisional record of the case will be closed, and after which

no additional evidence or argument will be accepted.” ACEs argues that in conjunction,

these two regulations prohibit OHA from considering amendments to the Solicitation

made after OHA sets the record to be closed.

       The government responds that OHA did not violate the regulations, and that even

if OHA did violate the regulations, the violation amounted to a harmless error. First, the

government argues that ACEs misconstrues the regulations and that in NAICS appeals,

the record includes the Solicitation and all its amendments. See Def.’s MJAR at 30-31.

The government explains that the regulations ACEs relies on are contained in Subpart B,

while OHA appeals are “[t]he rules of practice set out in . . . Subpart C.” 13 C.F.R.

                                            37
§ 134.301. Pursuant to Subpart C, Subpart B may apply “[e]xcept where inconsistent with

this subpart[.]” 13 C.F.R. § 134.313. Further, Subpart C indicates that “the contents of the

record also include the case file or solicitation submitted to OHA in accordance with

§ 134.306.” 13 C.F.R. § 134.315 (emphasis added). 13 C.F.R. § 134.306 requires the CO

to send OHA “an electronic link to or a paper copy of both the original solicitation

relating to that procurement and all amendments.” The case file itself is defined to

include “the solicitation and amendments.” Therefore, the government argues that where

OHA reviews a NAICS code appeal, the record also includes amendments to the

solicitation. Second, the government argues that even if OHA violated its own

procedures, the violation amounted to a harmless error because the relevant amendments

to the Solicitation were only stylistic. As discussed above, there were only seven changes

to the Solicitation:

   1. “Urgent, Non-Test, Network down reporting: 4 hours” was removed from Section

4.3.1(e)(2).

   2. Section 5.2, subsections (a)-(d), of the original PWS were replaced with Section

5.2, subsections (a)-(g), in the revised (Rev 01) PWS.

   3. Section 5.2, subsections (e), (f), and (g), of the original PWS were moved to

Section 5.0, subsections (a), (b), and (c), of the Rev 01 PWS.

   4. In Section 5.3(d)(6), “1000 business days” was changed to “45 business days.”

   5. In Section 5.3(f), the citation “sections 3a-e” was changed to “sections 5.3(c)1-5.”

   6. In Sections 9 and 11, a parenthesis was added in the header to reflect the CLIN

numbers.

                                            38
   7. Section 12.0(c) and the “Staffing Requirements” table were updated to number the

key personnel for clarity.

       The court agrees with the government’s arguments. First, the court finds that

because Subpart C and not Subpart B governs the dispute, OHA did not violate its own

procedures by considering the October Solicitation amendments. Second, the court agrees

with the government that even if there were an error, it would be harmless. See Trans

Dig. Techs., LLC v. United States, 138 Fed. Cl. 34, 41 (2018) (“We also apply the rule of

harmless error, requiring protestors to show that they were in fact harmed by agency

actions alleged to be improper.”). At oral argument, when asked about how ACEs was

harmed, ACEs argued that the procedures are mandatory and any failure to follow the

regulations is grounds for reversal of OHA’s decision. Oral Arg. 14:31:10-14:31:50. This

is not the case. Where the government demonstrates that the relevant amendments to the

Solicitation were stylistic and not substantive and ACEs does not identify any alleged

harm from the inclusion of the last Solicitation amendment, the court finds that even if

there was a procedural error, that error was harmless and does not provide a basis for

setting aside OHA’s decision.

              2. OHA’s Affirmance of NAICS Code 541715

       ACEs claims that OHA’s decision finding no clear error in MDA’s selection of

NAICS code 541715 for this Solicitation was arbitrary, capricious, and an abuse of

discretion. Pl.’s Resp. at 14-20. First, ACEs argues that OHA’s conclusion that the

description of research and development under Footnote 11(d) was applicable to work

described in the Solicitation was arbitrary, capricious, and an abuse of discretion because

                                            39
OHA’s conclusion was not supported by the record. Second, ACEs argues that because

Footnote 11(d) is inapplicable, this Solicitation does not otherwise qualify as research

and development under NAICS code 541715. The court begins by reviewing OHA’s

decision.

       ACEs argued before OHA that NAICS code 541715 is inappropriate for this

Solicitation because “this is not a research and development procurement” and urged

“OHA to conclude NAICS code 541513, Computer Facilities Management Services, with

a $27.5 million annual receipts size standard, is the appropriate NAICS code” for the

Solicitation. AR 3885. ACEs’ principal argument was that “contracts to support or assist

a research organization cannot be automatically deemed to be research and development

procurements.” Id. In particular, ACEs argued that CLIN 006, which “is the single largest

CLIN, making up 41% of the Full Time Equivalents (FTE) for the instant procurement,”

includes required tasks which “are not research and development, but design and

implementation of hardware and software solutions that support MDA.” Id.

       OHA concluded that “an RFP which requires evaluations and simulations

involving missiles and similar devices, as well as a thorough knowledge of these

technologies, may be designated under NAICS 541715, under the Guided Missiles and

Space Vehicles exception.” AR 3890. (citing NAICS Appeal of DCS Corp., SBA No.

NAICS-5703, 2016 WL 270949, at *4 (Jan. 6, 2016)). Regarding this procurement, OHA

explained that “this RFP explicitly requires services involving evaluations and simulation

of missiles, requiring a thorough knowledge of missiles, and thus fits into the description

of the NAICS exception in Footnote 11(d).” AR 3891.

                                            40
       Specifically, OHA concluded that CLIN 006 on network design, call for services

that qualify as research and development under Footnote 11(d). AR 3891. OHA stated

that the “contractor is required to develop new tools and processes to respond to changes

required by the results of testing” and that the “contractor will participate in the system

design activities to implement improvements to CI/CAT, asset management and all of

MDA’s data flow.” Id. OHA specifically concluded that under CLIN 006, the

“contractor’s work will include original investigation, or research, to obtain necessary

knowledge to develop the AoA for hardware and software solutions necessary to support

the CI/CAT.” Id. OHA stated that CLIN 006 “represents the largest portion of this

contract, with 41% of FTEs to be worked” and “includes research and development of the

software which will be an integral part of the essential simulations to support the

BMDS.” Id. Therefore, OHA concluded, “the CO was correct in characterizing this CLIN

as research and development.” Id. OHA added that because ACEs had not shown that

“NAICS code 541715 is clearly erroneous for this RFP, it is unnecessary to consider the

NAICS code [ACEs] advocates.” AR 3892.

       ACEs argues that OHA failed to cite any evidence for the conclusion that “this

RFP explicitly requires services involving evaluations and simulations of missiles,

requiring a thorough knowledge of missiles, and thus fits into the description of NAICS

exception in Footnote 11(d).” Pl.’s MJAR at 38 (citing AR 3891). In this connection,

ACEs argues that OHA mischaracterized the Solicitation’s statement that a “thorough

knowledge of the BMDS and the interdependency of these labs is required to manage the

assets” to mean a thorough knowledge of missiles is required. Pl.’s MJAR at 38. Instead,

                                             41
ACEs argues that the prior statement in the Solicitation merely requires understanding

“how MDA is organized and how it manages the BMDS.” Id. Similarly, ACEs argues

that because the terms “evaluations and simulations of missiles” and “thorough

knowledge of missiles” appears nowhere in the Solicitation, OHA’s application of

Footnote 11(d) was arbitrary and capricious. Id. at 38-39. ACEs argues that if Footnote

11(d) is read broadly enough to cover the services in this Solicitation, “any services

performed in the ARC (e.g., construction, maintenance, security) could ‘involve’

evaluations and simulations that require a ‘thorough knowledge of complete missiles and

spacecraft.’” Pl.’s Resp. at 15.

       The government argues first that ACEs’ challenge to OHA’s decision regarding

the application of Footnote 11(d) is contradicted by the record and thus without merit.

Contrary to ACEs’ claims, the government points to the Solicitation’s requirement “for a

“thorough knowledge of the BMDS and the interdependency of these labs” as plain

support for OHA’s decision. AR 3891.

       The court agrees with the government that it was not irrational for OHA to treat

the Solicitation as requiring an awardee to have both a “thorough knowledge of the

BMDS” and a thorough knowledge of “the interdependency of these labs.” See Def.’s

MJAR at 25.10 For this reason, OHA’s reliance on Footnote 11(d) was not misplaced on

the first ground asserted by ACEs.


10
  ACEs’ reliance on Millenium Eng’g & Integration Co., SBA No NAICS-5309, 2011 WL
6183624, at *11 (Dec. 12, 2011) for the proposition that Footnote 11(d) does not apply even
when “knowledge of missiles and spacecraft is the heart of the RFP” is misplaced. In Millenium,
OHA affirmed the NAICS code designation for engineering services because while Footnote
                                              42
       Second, the government argues that while the Solicitation does not use the exact

language in Footnote 11(d) regarding “evaluations and simulations of missiles” and

“thorough knowledge of missiles,” OHA rationally concluded that under CLIN 006 as

described in the PWS, “[t]he contractor is required to develop new tools and processes to

respond to changes required by the results of the test[,] . . . participate in the system

design activities[,] . . . [and] obtain necessary knowledge to develop the AoA for

hardware and software solutions necessary to support the CI/CAT,” AR 3891, and thus

“contractor’s work will include original investigation, or research, to obtain necessary

knowledge to develop the AoA for hardware and software solutions necessary to support

the CI/CAT.” Id.

       Again, the court agrees that OHA rationally determined that the tasks identified

above meet the criteria for Footnote 11(d). The Solicitation called for the contractor to

respond to results of tests, develop tools, participate in system design, and obtain

knowledge for hardware and software and because completion of those services will

require a thorough knowledge of a missile defense system, it was not irrational for OHA

to conclude that those services fall under Footnote 11(d)’s definition of research and

development.

       Moreover, the court finds that the OHA decision, contrary to ACEs’ contentions,

is consistent with past OHA decisions applying Footnote 11(d). See NAICS Appeal of

DCS Corp., NAICS-5703, 2016 WL 270949, at *4 (Jan. 6, 2016) (affirming the


11(d) could apply, the agency’s view of the services as engineering services rather than research
and development was not clear error. Millenium, SBA No. NAICS-5309, at *11.
                                               43
application of Footnote 11(d) to work “assessing aircraft safety and performance in

connection with the loading, carriage, and release of aircraft”); Inkling Media Co., LLC,

NAICS-4850, 2007 WL 1537649, at *5 (May 16, 2007) (affirming the application of

Footnote 11(d) where the purpose of the RFP was to obtain services “to coordinate all

technology base development to maximize benefits for strategic and theater missile

defense”).

       In view of the foregoing, the court finds that ACEs’ concern that OHA applied

Footnote 11(d) too broadly so as to include “any services performed in the ARC (e.g.,

construction, maintenance, security)” is without merit. See Pl.’s Resp. at 15. OHA did not

conclude that all the work in the contract was research and development; OHA identified

the work in certain CLINs that was research and development. Because CLIN 006

accounted for 41% of the work and no other one NAICS code covered more than 41% of

the work, it was not irrational for OHA to affirm the NAICS code 541715 designation.

See FAR § 19.102(d) (requiring the contractor to assign the NAICS code “accounting for

the greatest percentage of the contract price”).11



11
   To that extent ACEs argues that even if CLIN 006 calls for research and development, NAICS
code 541715 is inappropriate because CLIN 006 does not represent the majority of work under
the Solicitation, its argument also fails. See Pl.’s MJAR at 34. First, this argument has been
waived because it was not raised before OHA. See Palladian Partners, Inc. v. United States, 783
F.3d 1243, 1261 (Fed. Cir. 2015) (dismissing the protestor’s claim where the protestor “fail[ed]
to present this argument in the pending OHA appeal”). Indeed, ACEs made the opposite
argument by relying on CLIN 006 exclusively in its arguments to OHA that NAICS code 541513
covered the majority of the contract work. AR 3885. Second, ACEs provides no evidence to
show that any other single NAICS code covers more than the 41% of the work in CLIN 006.
Thus, OHA’s conclusion regarding the NAICS code covering the largest amount of the contract
work was CLIN006 is supported.

                                              44
       B. The Past Performance Evaluation Criteria Are In Accordance With the
          Law and ACEs Was Not Prejudiced by the CO’s Past Performance
          Evaluation Approach

       ACEs argues that MDA’s change of past performance evaluation criteria from the

March DRFP which included five rating categories to the current Solicitation which only

gives an acceptable or unacceptable rating was not in accordance with the law for two

reasons. First, ACEs claims that the Solicitation’s acceptable/unacceptable eligibility

scheme fails to make a comparative analysis as required by 48 C.F.R. § 15.305(a)(2)(i)

which states the “comparative assessment of past performance information is separate

from the responsibility determination.” Second, ACEs argues that assigning offerors with

no relevant past performance an “acceptable” rating for past performance is not in

accordance with 41 U.S.C. § 1126(b) and 48 C.F.R. § 15.305(a)(2)(iv) which both state

“if there is no information on past performance of an offeror or the information on past

performance is not available, the offeror may not be evaluated favorably or unfavorably

on the factor of past performance.”12 ACEs argues that it is prejudiced by the past

performance evaluation terms because the terms unlawfully prevent ACEs from getting

credit from its allegedly excellent past performance. For the reasons that follow, both

arguments are meritless.




12
  48 C.F.R. § 15.305(a)(2)(iv) states “In the case of an offeror without a record of relevant past
performance or for whom information on past performance is not available, the offeror may not
be evaluated favorably or unfavorably on past performance.”

                                                45
       ACEs’ argument that 48 C.F.R. § 15.305(a)(2)(i) requires comparative analysis

that goes beyond a pass/fail scheme is unsupported.13 ACEs argues that “under the FAR,

past performance is a mandatory evaluation factor” and that an acceptable/unacceptable

evaluation does not satisfy the regulations requirement for a “comparative” analysis. Pl.’s

Resp. at 8. In making this argument, ACEs asserts that Section 15.305(a)(2)(i) requires

MDA to “conduct a comparative analysis of performance histories beyond a threshold

inquiry of eligibility.” Pl.’s MJAR at 25.

       The government contends, however, that this Solicitation satisfies Section

15.305(a)(2)(i) by comparing the past performance of offerors to the requirements in the

Solicitation to arrive at the acceptable or unacceptable rating and that ranking based on

past performance is not required.

       In full, Section 15.305(a)(2)(i) states:

               Past performance information is one indicator of an offeror’s ability to
               perform the contract successfully. The currency and relevance of the
               information, source of the information, context of the data, and general
               trends in contractor’s performance shall be considered. This comparative
               assessment of past performance information is separate from the
               responsibility determination required under subpart 9.1.




13
   To the extent that ACEs argues that 48 C.F.R. § 15.305(a)(2)(i) requires comparing the
offerors’ past performance against one another, this argument is without support. First, ACEs
states in its response that it “made no such argument.” Pl.’s Resp. at 8. But even if it did, that
argument would fail. This court has previously interpreted Section 15.305(a)(2)(i) to require a
comparison of an offeror’s past performance to the contract requirements. United Concordia
Cos., Inc. v. United States, 99 Fed. Cl. 34, 45 (2011) (“The term ‘comparative’ is used in this
section in the sense that the offerors’ past performance is compared with the requirements of the
contract.”). Indeed, “the comparative analysis sought by plaintiff would require an ‘apples-to-
oranges’ comparison because the offeror’s past efforts arise out of different contract.” See id.
                                                46
The government thus argues that when read in its entirety, Section 15.305(a)(2)(i) makes

clear that “this comparative assessment” refers to the earlier stated requirement to

evaluate whether the offeror could perform the contract successfully by looking to the

“currency, relevance, source, context, and general trend” of the offeror’s past

performance. The sentence also requires that this assessment be different than the

responsibility determination. According to the government, this Solicitation does exactly

that. AR 3259-60 (evaluating the offerors’ past performance on recency, relevancy, and

quality and clarifying that the past performance evaluation is different than the

responsibility determination). The government argues that this court has defined

“comparative” to mean that the “offerors’ past performance is compared to the

requirements of the contract.” United Concordia Cos., Inc. v. United States, 99 Fed. Cl.

34, 45 (2011).

       The court agrees with the government’s reading of 48 C.F.R. § 15.305(a)(2). In

addition, the court finds that ACEs’ reliance on Al Ghanim Combined Group Co. Gen.

Trad. & Cont. W.L.L. v. United States, 56 Fed. Cl. 502 (2009) is misplaced. Al Ghanim

involved 48 C.F.R. § 15.305(a)(3)’s technical evaluation requirements not 48 C.F.R.

§ 15.305(a)(2)’s past performance evaluation requirements. See id. at 519.14 The

government’s reading of 48 C.F.R. § 15.305(a)(2)(i) is supported and ACEs has not


14
   48 C.F.R. § 15.305(a)(3) provides “Technical Evaluation. When tradeoffs are performed (see
15.101-1), the source selection records shall include – (i) An assessment of each offeror’s ability
to accomplish the technical requirements; and (ii) A summary, matrix, or quantitative ranking,
along with appropriate supporting narrative, of each technical proposal using the evaluation
factors.” This references 48 C.F.R. § 15.101-1 which describes how a tradeoff process functions.

                                                47
shown that the agency violated the provision by having only acceptable or unacceptable

as the standards for evaluating past performance.

         Regarding ACEs’ second argument that the Solicitation’s past performance

evaluation criteria violate 41 U.S.C. § 1126(b) and 48 C.F.R. § 13.305(a)(2)(iv), the court

finds as follows.15 ACEs argues that the Solicitation effectively treats “any offeror with

no past performance history . . . favorably by being rated as ‘Acceptable’ – the highest

possible rating.” Pl.’s MJAR at 25. ACEs asserts that at best those contractors lacking

relevant past performance experience should receive only a “neutral” rating. See Pl.’s

MJAR at 5 n.1, 25. As ACEs explained at oral argument, a lawful Solicitation would

provide a “neutral” but not “acceptable” rating to those with no past performance. ACEs

conceded, however, that those with no past performance, under either formulation should

be allowed to compete. Oral Arg. 15:10:40-15:11:30.

         The government argues that because under either formulation those without

relevant past performance would be eligible to compete for the award, ACEs cannot show

any prejudice from MDA’s “acceptable” and “unacceptable” rating system. Def.’s MJAR

at 40.

         The court agrees with the government that because under ACEs’ proposed

formulation contractors without relevant past experience would be eligible to compete,

ACEs has not shown how it would benefit from a change in the Solicitation’s past

performance approach to include a neutral rating. It is for this reason that ACEs has not


15
  The parties’ arguments for both 41 U.S.C. § 1126(b) and 48 C.F.R. § 15.305(a)(2)(iv) are one
and the same.
                                              48
established prejudice. To establish prejudice, ACEs would have to show that a higher

past performance rating would impact the agency’s tradeoff evaluation so that offerors

with higher past performance ratings would be given a better opportunity for award than

those with no relevant past performance. In this Solicitation, however, MDA elected not

to include past performance in the tradeoff evaluation and ACEs has not challenged that

decision.

       It is clear from its complaint that ACEs has not alleged that MDA unlawfully

failed to include past performance in its tradeoff analysis. The Solicitation explicitly

indicates, as noted above, that the “selection decision will document tradeoffs between

Factors 4, 5, and 6 in the competitive range [for those offerors receiving] receiving an

acceptable rating for Factors 1-3.” AR 3226. Past performance was Factor 3 and therefore

not part of the tradeoff analysis. Id. ACEs’ amended complaint makes no challenge to the

aforementioned language. Instead, ACEs only challenges the past performance evaluation

criteria to the extent that assigning a rating of “Acceptable” to “any offeror without a

record of relevant past performance or for whom information on past performance is not

available” as opposed to “neutral” violates 41 U.S.C. § 1126(b) and 48 C.F.R.

§ 15.305(a)(2)(iv). Amend. Compl. ¶¶ 31-35. A challenge to the past performance criteria

is not the same as a challenge to the tradeoff analysis criteria.

       Having failed to challenge MDA’s decision not to include past performance in the

tradeoff evaluation, ACEs cannot demonstrate that there would be any difference to its

award potential under the current Solicitation’s formulation of Factor 3 or under the

approach it advocates. In such circumstance, ACEs failed to demonstrate prejudice.

                                              49
V.     CONCLUSION

       In sum, ACEs has not met its burden to show that it has standing to pursue this

pre-award protest. Furthermore, even if it could establish standing, ACEs has failed to

meet its burden to demonstrate that OHA was arbitrary, capricious, abused its discretion,

or was not in accordance with the law when it affirmed the CO’s designation of NAICS

code 541715 for this Solicitation. In addition, ACEs has not established that the CO’s

past performance evaluation approach violated 48 C.F.R. § 15.305(a)(2)(i), or that the

approach prejudiced ACEs under 41 U.S.C. § 1126(b) or 48 C.F.R. § 15.305(a)(2)(iv)

where ACEs had not challenged the CO’s tradeoff criteria. For the forgoing reasons, the

court GRANTS the government’s cross-motion for judgment on the administrative

record and DENIES ACEs’ motion for judgment on the administrative record together

with its motion for injunctive relief. Each party shall bear its own costs.

       IT IS SO ORDERED.



                                                            s/Nancy B. Firestone
                                                            NANCY B. FIRESTONE
                                                            Senior Judge




                                             50
