        In the United States Court of Federal Claims
                             No. 14-155C
                       (Filed: April 22, 2014)*
      *OPINION ORIGINALLY FILED UNDER SEAL ON APRIL 14, 2014.

                                        )
HUGHES GROUP, LLC,                      )
D/B/A DIA-MO CLEAN,                     )
                                        )
                   Plaintiff,           )
                                        )
v.                                      )      Bid Protest; Motion to Dismiss; Lack
                                        )      of Standing; Failure to Establish
THE UNITED STATES,                      )      Substantial Chance of Award
                                        )
                   Defendant,           )
                                        )
and                                     )
                                        )
MANAGEMENT SERVICES                     )
NORTHWEST, INC.,                        )
                                        )
        Defendant-Intervenor.           )
                                        )


      Robert A. Klimek, Jr., Washington, DC, for plaintiff.

        Tanya B. Koenig, Civil Division, U.S. Department of Justice, Washington, DC,
with whom were Stuart F. Delery, Assistant Attorney General, and Robert E. Kirschman,
Jr., Director, Commercial Litigation Branch, for defendant. John S. Tobey, Office of
General Counsel, General Services Administration, Washington, DC, of counsel.

      John P. Ahlers, Seattle, WA, for defendant-intervenor.

FIRESTONE, Judge.

                                    OPINION
       This post-award bid protest case arises out of Solicitation No. GS-10P-14-LS-D-

0003 (“solicitation” or “procurement”), in which the General Services Administration

(“GSA”) sought janitorial and landscaping services for Federal Center South, Building

1202 in Seattle, Washington. Administrative Record (“AR”) at 7. Plaintiff Hughes

Group, LLC (“Hughes”), the incumbent contractor and an unsuccessful bidder for the

solicitation, seeks to permanently enjoin GSA from proceeding with the award of the

contract to Management Services Northwest, Inc. (“MSNW”) on the principal grounds

that GSA impermissibly engaged in discussions with MSNW that allowed it to make

major beneficial changes to its proposal. 1

       Hughes filed the present action on February 27, 2014. MSNW, the awardee, was

allowed to intervene on March 7, 2014. Pending before the court is Hughes’s motion for

judgment on the administrative record. 2 The United States (“the government”) and

MSNW have moved to dismiss Hughes’s complaint under Rule 12(b)(1) of the Rules of

the United States Court of Federal Claims (“RCFC”) for lack of standing. Both the

government and MSNW have also moved, in the alternative, for judgment on the

administrative record pursuant to RCFC 52.1.




1
  Hughes also argued that GSA erroneously rated Hughes “unacceptable” for past performance.
As discussed in footnote 4, infra, the record demonstrates that Hughes received a “marginal”
rating for past performance. Hughes appears to have conceded this argument in its reply brief.
2
 The administrative record was filed on March 7, 2014 and was corrected on March 13, 2014.
Hughes’s motion to supplement the administrative record was denied on March 26, 2014.

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       For the reasons set forth below, the court finds that Hughes lacks standing to bring

the present claim. As a result, the government’s and MSNW’s motions to dismiss are

GRANTED.

I.     STATEMENT OF FACTS

       The facts in this case are undisputed and are set forth in the administrative record.

As noted above, the solicitation at issue in this case is for janitorial and landscaping

services, to be performed from January 1, 2014 to December 31, 2014, with three one-

year options. Previously, GSA had entered into a contract with Hughes to perform some

of these services, with a base year expiring on August 31, 2013 and four one-year option

periods. AR 1, 160. GSA elected not to exercise Hughes’s first option year, and instead

elected to extend Hughes’s contract for four months and rebid the contract. The new

solicitation expanded the scope of the contract to include landscaping services in addition

to janitorial services. AR 264-65. In deciding not to exercise the options in Hughes’s

contract, GSA noted that Hughes’s “performance [was] a concern throughout the

performance period.” AR 265.

       The solicitation was posted on December 6, 2013. AR 283. The award was to be

made “on a best value basis utilizing the trade off source selection method.” AR 434.

The evaluation factors identified by GSA were (1) Technical Capability, (2) LEED-

EB/Green Cleaning, (3) Relevant Past Performance, and (4) Price. Id. Technical

Capability was identified as the most important factor, followed by LEED-EB/Green

Cleaning and Relevant Past Performance, respectively. Id. Additionally, “[a]ll

evaluation factors other than price, when combined, [were identified to be] significantly


                                              3
more important than price.” Id. Under the terms of the solicitation, proposals were due

to GSA by 10:00 A.M. on December 23, 2013. AR 283. Due to the abbreviated

procurement period, the solicitation provided that “[v]endors may be restricted to a short

turnaround (i.e., less than 24 hours) in responding to the Contracting Officer during any

exchange/clarification period.” AR 436. Four companies submitted bids: MSNW,

Hughes, Great Western Maintenance Corp (“GWMC”), and Triangle Maintenance and

Janitorial Service (“Triangle”).

       Once the bids were received and preliminarily reviewed, GSA found that

clarifications were necessary because offerors had organized information differently. On

Thursday, December 26, 2013 at approximately 5:30 P.M., GSA sent emails to each

offeror asking for responses by no later than 9:00 A.M. on Monday, December 30, 2013.

AR 901-12. In its email to Hughes, GSA requested that Hughes “verify that [its]

submittal includes a management plan and a staffing plan” and asked Hughes to send an

electronic copy of those plans by no later than 9:00 A.M. on December 30, 2013. AR

904. Hughes responded on December 30, 2013 at 11:00 A.M., two hours later than the

response deadline. AR 965-67. In its email to MSNW, GSA requested that MSNW

“clarify [its] Quality Control Plan” and send an electronic copy. AR 909. 3 MSNW



3
  The RFP provided that the contractor was to “establish and implement” a Quality Control Plan
(“QCP”) to ensure that the requirements of the contract were met. AR 331. The QCP was
described as a “written document that specifies a system for determining whether or not cleaning
services requirements are being met . . . . The QCP is a living document and may be subject to
change depending on the needs of the contract. . . . See Section C.18 ‘Contractor
Submittals/Deliverables Chart’ to find the time frame to submit the QCP.” AR 331. Section
C.18, in turn, provides that the QCP “must be submitted 15 days prior to the start of work.” AR
335, 428.

                                               4
timely responded to GSA’s clarification email on December 29, 2013 with its QCP. AR

946-54. In its email to GWMC, GSA requested clarification on whether a “management

plan [and] staffing plan” was available and asked GWMC to send an electronic copy. AR

901. GWMC submitted a timely response to GSA’s clarification requests. AR 926-945.

In its email to Triangle, GSA requested clarification that a management plan was

available, but Triangle did not respond to GSA’s clarification request. AR 911-12.

        A Source Selection Evaluation Board consisting of three individuals, as well as the

contracting officer and contract specialist, was assembled to rate the proposals for the

final best value determination. AR 1059, 1099. MSNW received an overall rating of

“very good” based on a “very good” rating on technical capability, an “exceptional”

rating on green cleaning, and an “acceptable” rating on relevant past performance. AR

1100. MSNW provided a price proposal of $2,236,099.06. AR 1010. GWMC ranked

second; it received an overall rating of “marginal” based on a “marginal” rating on

technical capability, an “acceptable” rating on green cleaning, and a “marginal” rating on

relevant past performance. AR 1100. GWMC’s price proposal was for [                ]. AR 1109.

Hughes ranked third. It received an overall rating of “marginal” based on a “marginal”

rating on technical capability, an “unacceptable” rating on green cleaning, and a

“marginal” rating on relevant past performance. 4 AR 1100. Hughes’s price proposal was

for [   ]. AR 1109. Triangle ranked fourth. It received an overall rating of

“unacceptable” and [      ]. AR 1110.

4
  Although the technical consensus shows that Hughes received a rating of “unacceptable” for
relevant past performance, the contracting officer later upgraded Hughes’s rating for that factor
to “marginal,” as explained in her narrative. AR 1107.

                                                5
       Under the terms of the solicitation, “[a]ny proposal receiving an overall ‘Marginal’

or below rating shall not be considered for Award; however, if the Government receives

limited competition with an overall ‘Marginal’ rating, the Government reserves the right

to consider a ‘Marginal’ rating.” AR 436. Because GSA received a proposal from

MSNW, which was rated as “very good,” GSA determined that GWMC, Hughes, and

Triangle, which had received overall technical ratings of “marginal” or “unacceptable,”

were ineligible for the award, AR 1111, and awarded the contract to MSNW on

December 31, 2013. AR 1135.

       Hughes filed a post-award protest with the GAO on January 2, 2014. AR 1302-

05. Upon receiving notice of the GAO protest, GSA issued a new task order to Hughes

off the GSA Schedule to continue performance during the protest period in order to avoid

a gap in janitorial services. AR 1312-76. GSA has extended Hughes’s task order month-

by-month, most recently on March 3, 2014. AR 1646. The current task order can be

extended no later than April 14, 2014. The GAO dismissed Hughes’s protest on February

19, 2014, after Hughes failed to respond to the agency report. AR 1642-45. This action

was filed on February 27, 2014.

II.    DISCUSSION

       A.     Standard of Review

       As noted above, the government and MSNW both argue that Hughes lacks

standing to bring this bid protest and move to dismiss pursuant to RCFC 12(b)(1). The

standard of review for a motion to dismiss for lack of subject-matter jurisdiction is well

settled. The plaintiff bears the burden of establishing subject-matter jurisdiction. Trusted


                                             6
Integration, Inc. v. United States, 659 F.3d 1159, 1163 (Fed. Cir. 2011). When

considering a motion to dismiss for lack of subject-matter jurisdiction, the court assumes

the facts alleged in the complaint to be true. Pixton v. B & B Plastics, Inc., 291 F.3d

1324, 1326 (Fed. Cir. 2002) (citing Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)).

Similarly, the court must draw all reasonable inferences in the plaintiff’s favor. Anaheim

Gardens v. United States, 444 F.3d 1309, 1314-15 (Fed. Cir. 2006). However, if a

motion to dismiss challenges the jurisdictional facts alleged in the complaint, the court

may consider evidence beyond the pleadings to resolve the dispute. Reynolds v. Army

and Air Force Exchange Serv., 846 F.2d 746, 748 (Fed. Cir. 1988).

       B.     Hughes Lacks Standing to Bring the Present Claim

       The jurisdictional grant for the U.S. Court of Federal Claims to hear bid protests is

found under 28.U.S.C. § 1491(b)(1), which provides that this court

       shall have jurisdiction to render judgment on an action by an interested
       party objecting to a solicitation by a Federal agency for bids or proposals
       for a proposed contract or to a proposed award or the award of a contract or
       any alleged violation of statute or regulation in connection with a
       procurement or a proposed procurement.

Id. The “pivotal element” of this court’s subject-matter jurisdiction is “whether a

protestor qualifies as an ‘interested party’” under the statute. RhinoCorps Ltd. Co. v.

United States, 87 Fed. Cl. 481, 485 (2009). The Federal Circuit has stated that “an

interested party is an actual or prospective bidder whose direct economic interest would

be affected by the award of the contract.” Orion Tech., Inc. v. United States, 704 F.3d

1344, 1348 (Fed. Cir. 2013) (citing Rex Serv. Corp. v. United States, 448 F.3d 1305,

1307 (Fed. Cir. 2006)).


                                             7
       Since there is no dispute that Hughes is an actual bidder and thus satisfied the first

prong of the interested party test, the dispute in this case centers on whether Hughes has

the required “direct economic interest.” To statisfy the “direct economic interest”

requirement, a protester must show that it had a “substantial chance” for award but for the

alleged error in the procurement process.” Info Tech. & Applications Corp. v. United

States, 316 F.3d 1312, 1319 (Fed. Cir. 2003). Here, the government and MSNW argue

that Hughes lacks a “direct economic interest” on the grounds that Hughes received a

“marginal” rating and was determined by GSA to be ineligible for award. The

government and MSNW argue further that, even though GSA reserved the right to

consider a “Marginal rating” if “it received limited competition,” the solicitation did not

require GSA to consider offerors who received “marginal” ratings. Thus, they contend

that Hughes cannot show that it would have a substantial chance of award.

       The government and MSNW contend that, even if Hughes is correct and GSA

erred by allowing MSNW to submit a QCP after proposals were due, Hughes would still

lack standing. According to the government and MSNW, Hughes cannot show that it

would have a substantial chance of award because GWMC ranked above Hughes and did

not have any “unacceptable” ratings, while Hughes had one “unacceptable” rating. They

argue that, in such circumstances, GWMC would be the only offeror with a substantial

chance for award.

       In response, Hughes argues that it has standing because, in the event that MSNW’s

award was not lawful, all “marginal” offerors, including GWMC and Hughes, would

potentially be eligible for award. Hughes contends that a protestor does not have to show


                                              8
that, but for the alleged error, the protestor would have actually been awarded the

contract. Rather, Hughes argues, it is enough for a plaintiff to show that it would be

within the “zone of active consideration” as described by this court in Preferred Sys.

Solutions, Inc. v. United States, 110 Fed. Cl. 48, 58 (2013). According to plaintiff, all

marginal offerors in this case would be within the zone of active consideration, thus

satisfying the direct economic interest requirement. In addition, Hughes argues that, if

the award to MSNW were set aside and GSA decided to rebid the contract, Hughes

would have a substantial chance of award and thus demonstrates a direct economic

interest, as in Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d

1324, 1333-34 (Fed. Cir. 2001)

       The court finds that Hughes does not have a substantial chance of award and

therefore lacks standing. Because Hughes earned a rating of “unacceptable” for LEED-

EB/Green Cleaning and “marginal” ratings for the two other evaluation factors, Hughes

was excluded from consideration and could not be awarded the contract in the first

instance. Even assuming that the award to MSNW were set aside, Hughes’s low ratings

would preclude Hughes from having a substantial chance of award. In the context of this

best value procurement, plaintiff’s “unacceptable” rating, which it does not challenge, 5 is

fatal to its standing claim. Where, as here, the other offeror with a “marginal” rating,

GWMC, did not have any “unacceptable” ratings, GWMC alone—and not Hughes—is

the only offeror with a substantial chance of award. In the context of this best value

5
  As noted in footnote 4, supra, Hughes originally challenged the unacceptable rating it received
for past performance. That rating was, however, changed to marginal and Hughes is no longer
objecting to the rating.

                                                9
solicitation where the evaluation criteria ratings were deemed significantly more

important than price, Hughes, with an “unacceptable” rating for a key component of the

contract, does not have a substantial chance for award. Hughes is therefore not like the

plaintiff in Preferred Solutions, where the plaintiff argued that if it were properly rated it

would have had a sufficiently high rating to be considered for award. 110 Fed. Cl. at 58.

Here, Hughes’s rating would still not be equal to the higher-ranking GWMC. As

government counsel indicated at oral argument, if GSA were to consider an award to a

marginally-rated offeror, GWMC, and not Hughes, would have the substantial chance for

award.

          In addition, Hughes’s reliance on Impresa is unfounded. In Impresa, the agency

conceded that it would have to rebid the contract if the award were set aside and thus the

plaintiff would have standing because it could compete. 238 F.3d at 1334 (“In this case,

as the government has conceded at oral argument, if appellant’s bid protest were allowed

because of an arbitrary and capricious responsibility determination by the contracting

officer, the government would be obligated to rebid the contract, and appellant could

compete for the contract once again.”). In this case, there is no evidence that GSA would

be required to rebid the present contract if the award to MSNW had to be set aside. As

discussed above, if the award were set aside, GWMC could be selected under the terms

of the solicitation. For this reason, Impresa does not support a finding of standing in this

case. 6


6
  Although the court finds that plaintiff lacks standing, the court notes that, even if plaintiff had
standing, its argument on the merits is not supported. Plaintiff argues that GSA’s request for

                                                  10
III.   CONCLUSION

       Because Hughes lacks standing, the government’s and defendant-intervenor’s

motions to dismiss are GRANTED. The clerk is directed to dismiss plaintiff’s action for

lack of subject matter jurisdiction under RCFC 12(b)(1).

       IT IS SO ORDERED.


                                                             s/Nancy B. Firestone
                                                             NANCY B. FIRESTONE
                                                             Judge




clarification on December 26, 2013 and MSNW’s submission of a document labelled “Quality
Control Plan” on December 29, 2013 constitute a revision of MSNW’s proposal that provided it
a competitive advantage. The government argues in response that, with the exception of two
sentences, the substantive plan provided to GSA on December 29, 2013 was merely a
compilation of different elements taken virtually verbatim from MSNW’s original proposal. In
support of its argument, the government identified sections of the proposal and QCP that are
substantively identical:

        Topic                         Location in proposal    Location in QCP
        Staffing plan                 AR 784                  AR 947-47
        Training program              AR 785-86               AR 948-949
        Assessments/Inspections       AR 787-789-90           AR 950-51
        Procedure for resolving       AR 791                  AR 952
        deficiencies and problems
        Communication plan            AR 788                  AR 952-53
        Management plan               AR 783                  AR 954

It is clear, based on the above-cited record references, that MSNW was not given the opportunity
to revise its proposal, but instead recompiled information that it had already provided to GSA.
Unlike a discussion, in which offerors are permitted to alter their bids in response to agency
questions, this submission served only to highlight information that GSA already had. See Info.
Tech. & Applications Corp. v. United States, 316 F.3d 1312, 1322 (Fed. Cir. 2003) (finding that,
even where the government requests additional information, a discussion only occurs if offerors
are allowed to revise their offers). Plaintiff’s argument would elevate form above substance by
requiring the requested elements of a proposal to each be contained in individual documents,
even if the solicitation does not so require.



                                               11
